Sabre Inc. is exempting its key business travel division from a major new agreement to move much of Travelocity's customer support to an Indian business process outsourcing firm. Many corporate travel agencies are considering offshore solutions for their corporate clients
(BTN, Feb. 9), but Travelocity is not the first to determine that only its consumer customers would be served from abroad. Revealing its multi-year deal with WNS Global Services today through a filing with the Securities and Exchange Commission, Travelocity wrote that the contact center operations for Travelocity Business "will continue to be performed by Travelocity employees."
However, Travelocity said it would close its contact center in Clintwood, Va., by year-end and would cut staff in San Antonio. It expects the transition of services to WNS to take seven to 12 months, beginning this spring. "By the end of the first quarter of 2005, WNS should be handling Travelocity's front-line customer service calls and e-mails, as well as some mid- and back-office functions (including ticketing/queues/reissues)," Travelocity told the SEC. "WNS will transition these day-to-day operations of the customer service functions to its contact centers located in India. Travelocity employees will continue to handle sales calls, as well as advanced customer service issues and quality control." Sabre said it expects the deal to save it about $10 million this year.
In a nod to the political sensitivities about offshoring, the company wrote: "Travelocity worked diligently over several years to improve the cost structure of its contact centers, but, ultimately, attrition levels and competition with other online players has regrettably forced it to take outsourcing actions similar to its competitors."
Orbitz's customer support provider was bought by an Indian firm
(BTN, Dec. 8, 2003), though a spokesperson said it too would reserve business support for the United States. Expedia's major customer support partner, TRX, also is working on India expansion
(BTNonline, Feb. 2).
WNS Global Services works with several airlines, Canadian online agency Destina.ca and other travel companies, and about 50 percent of its operations support the travel industry. In an interview last month with
Business Travel News, WNS executive vice president Anish Nanavaty said that upwards of 60 percent of company revenues come from travel and between 1,600 and 1,700 of the firm's 3,500 employees "have a travel background."
"The travel sector is between a rock and a hard place in terms of the need to cut operational costs, literally from a survival standpoint," Nanavaty said. "And you have obstacles on the part of things like the airlines' unionized workforces, et cetera, which prevent them from moving things as fast as they would like. As more airlines free themselves from some of their unionized situations, they will continue to look at having at least a part of their back- or front-offices located in India. I view this to be true also in the travel agency space. It's also relevant for hotels, car rental companies, logistics companies or carriers."