Consultants and vendors are cautioning corporate expense managers to carefully examine the disparate definitions travel and entertainment expense vendors use in making claims that they can deliver end-to-end travel expense reporting. Some in the industry question whether simply integrating booking and expense reporting alone is enough to justify adopting such a tool.
By strictest definition, the end-to-end T&E expense solution remains an elusive and lofty goal, said Bob Langsfeld, a consultant with the Incline Village, Nev.-based Corporate Solutions Group. The Holy Grail of corporate travel automation would cover every step from pre-trip authorization, to cost determination, availability and inventory searches, ticket fulfillment, the actual trip and such elements within it as card use, expense reporting, financial review and reimbursement and ending with all data reaching a single database, he said.
"An end-to-end solution would and should be all of the above and should have a seamless integration of data flow," Langsfeld said. "The acid test would be: Does the data from all the different sources find their way into the process without human intervention? And do they populate the different documents throughout the process?"
Although no one—at least to the knowledge of Langsfeld and other industry watchers—has accomplished that, vendors have made recent strides to linking specific components of that long journey, mostly with the booking and expense reporting steps. The first leap forward came from Redmond, Wash.-based Concur Technologies early last year, when the company acquired Outtask, provider of the online booking tool Cliqbook, and later introduced a consolidated version of the tool
(BTN, Feb. 6, 2006). During the year, subscription revenue grew by 52 percent and almost as many customers signed up for Concur in 2006 as had in the three previous years combined, the company announced in its annual report.
Later in 2006, Paris-based technology firm KDS launched its own integrated self-booking and expense tool, which included such features as a travel billing module and travel manager dashboard
(BTN, Oct. 4, 2006). DataBasics also partnered with online reservation tool provider NuTravel to link with its ExpenSite reporting service, focusing on integration at the level of data repositories
(BTN, Dec. 4, 2006).Tom DePasquale, vice president and general manager of travel management services for Concur, said the key to deconstructing an end-to-end capability claim is identifying both ends in question. Using a trip as an analogy, he said some end-to-end claims are the equivalent of a trip from Philadelphia to Wilmington, Del., whereas he considered Concur's advancement more like a trip from Boston to Miami, particularly as receipt automation continues to become more common.
"For many customers, we're going to get to zero data entry," DePasquale said. "That's a huge benefit for those companies and employees."
When it comes to that earlier definition of a true end-to-end solution, Corporate Solution Group's Langsfeld said Concur remains in the best position, although he said KDS also is viable.
"They're getting there," he said of Concur. "They can do most of those steps relatively well, and they're certainly moving toward that end."
Some companies, meanwhile, are taking their own steps. Austin, Texas-based International Sematech, for example, has considered booking integration options for its homegrown tool, a system based on Oracle's PeopleSoft that already links pre-trip authorization and expense reporting
(BTN, Oct. 23, 2006).Not all in the field, however, are convinced that the booking to expense connection is of the best value. At least two major expense reporting tool vendors—Gelco Expense Management and Necho, a division of Parsippany, N.J.-based CyberShift, said that although they have capabilities to link to various booking tools, they have no intention of putting an integrated tool on the market.
"We do not have a travel booking module within our system, nor are we likely to add one," said Craig Fearon, senior product director for Necho. "Our approach has been to look for specific partnerships, and our solution to end-to-end as a whole has been to concentrate on areas where we have expertise."
Jeff Cronin, Gelco's vice president of solutions marketing, said the stumbling block is that complex global organizations rarely use the same online booking tool in all markets. This leaves a company trying to do a procure-to-pay cycle with the problem of trying to integrate in multiple places.
"Looking at Web technology, you have the ability to pick the best of breed in each region," Cronin said. "It is a reality in modern travel management that no one tool does everything the best."
A good analogy, according to David Hillman, a principal with Deerfield, Ill.-based Consulting Strategies, is the purchase of a home stereo system. In order to get the quality equipment at the price desired, customers often must select components from several different vendors.
Herein also lies the problem with developing an end-to-end solution, Necho's Fearon said. Each client company might have its own definition of end-to-end needs depending on its top priority, be it tighter controls or faster turnaround, he said.
"To further complicate this, you don't have a lot of unity within the company as a whole for an end-to-end solution," he said. "It takes a different meaning depending on to whom you are speaking. A director of finance might focus on expense reporting data, while the travel manager is more interested in the travel booking side."
Where vendors and consultants alike seem to agree is that linking components to provide an end-to-end solution is pointless unless it results in actionable data for the users. "End-to-end is a nice thing to say, but unless it improves the management process and the ability to mange your company, it's just a lot of words," Consulting Strategies' Hillman said.
The data is a large advantage to the integrated booking and expense tool, Concur's DePasquale said. Besides the obvious advantage of being able to identify inconsistencies in booked and actual expense data to ensure travelers are within policy and vendors are abiding by negotiated rates, overseers can identify other potential problems they might not catch when examining paper receipts, he said. For example, a traveler upgrading to a higher class of rental car might not realize that, by upgrading, they are losing free insurance, and the data could point out that problem.
Necho's end-to-end conversations have centered on amalgamating data streams into a consolidated database to identify trends, which also affords the chance to compare booked and expensed data, Fearon said. Gelco, meanwhile, has focused on its linking capabilities to credit card data, particularly as that data becomes richer with such enhancements as electronic hotel folio data.
"We're finding about 80 percent of spend today," Gelco's Cronin said. "The problem is finding that other 20 percent, but in a world where McDonald's takes American Express, those problems are becoming smaller and smaller."
Corporate Solutions Group's Langsfeld said it's not an error in judgment that some vendors are taking different routes. "Gelco knows where it's the strongest," he said. "If you have a better mousetrap, you stick to your core competencies."
End-to-end conversations have not been limited to T&E expense tool vendors. On the travel management company side, HRG reports it has developed an integrated booking and expense management tool that will be available by the third quarter of this year
(BTN, March 5). More recently, on the procurement side, American Express this month announced an integrated invoicing and settlement tool that is managed by a single online portal.
Still, despite all the achievements, Langsfeld said it's also important to look at the failures. Such powerful entities as the U.S. government have not been successful in their attempts to create the end-to-end solution, which calls into question whether a true end-to-end tool would equal the value of its required resources, he said.
"I've always been a strong proponent of the end-to-end solution, but to accomplish that, the nature of the business is such in the industry that it makes it very difficult to do it," Langsfeld said. "At some point, you almost wonder whether it's even worth it and whether you need to do it."