Automated booking and particularly expense tool usage is
predominant among midmarket travel programs, even those without tight controls
on preferred vendors, while most small-market buyers are using or in the
process of selecting the tools, according to Business Travel News' Small and Medium Enterprise Report. The
popularity of such tools stems from the increasing availability of technology
tailored to smaller travel programs and a growing desire for travel program
reporting among such companies.
Many SME buyers have found that automating the front and
back end of the travel process lets them gather data and manage costs even when
a fully managed travel program is not feasible, said Thomas Marks, director of
product marketing for Concur's small business segment. As such, they can find
savings outside of vendor negotiations or other processes that often require a
larger program's clout.
[Please click here to view the digital edition of the 2012 Small and Medium Enterprise Report,
featuring all charted data, downloadable as a pdf.]
"The trend for a
while was beginning to look at managed travel, but there was a bit of a
backlash, as a lot of companies don't have a culture that supports a mandate,"
Marks said. "Executives are not willing to get behind a travel program
that's not going to succeed."
Online Booking
Controls Light
Just under half of all buyers surveyed said they have a
company-approved online booking system in place, while another 8 percent said
they were selecting or implementing such a tool. A great majority of surveyed
midmarket buyers—those with between $2 million and $12 million in 2011
U.S.-booked air volume—use or plan to use online booking tools, with two-thirds
reporting a tool in place and only 11 percent noting no plans to use one. Usage
is much lower among small-market buyers—those with $2 million or less in air
volume—with only a third indicating they use an online booking system and as
many saying they have no intent to use one.
Most midmarket buyers direct travelers to such corporate
booking tools as GetThere or Concur Travel, but only 18 percent of small-market
buyers do, according to the survey. Small-market buyers were much more likely
to direct travelers to airline consumer or business sites or online travel
management companies. "Consumer sites are getting so good that there's
less of an incentive to move towards a managed travel program," said
Marks, claiming small-market buyers are finding little cost savings from strict
online booking mandates. "Employees can book travel however they like and
use a personal credit card."
Some small-market buyers, however, have employed online
booking tools to help enforce policies. Christa Neau, travel and events manager
for 300-employee software company Infinite Campus, did so by deploying and
customizing Concur for booking, with the help of its TMC.
"We have all the notifications," she said. "When
rules are broken, tickets are not instantly booked, and anything in excess of
our travel policy has to be signed off on by a department manager or director
and run through accounting."
World Travel Inc. CEO Jim Wells said small-market buyers
often take several steps to build up to such processes, first directing simple
domestic flights to be booked online and later introducing such controls as
purchasing windows.
Amy Page, travel manager for seasoning manufacturer
McCormick & Co., said she introduced about two years ago an online booking
tool for her program, which consists of about $7 million in annual North
America-booked air travel. Boosting adoption has been a challenge, not because
travelers want to be mavericks and book their own way but because they're
accustomed to the full-service, rent-a-plate model the company has in place,
she said.
"It's not mandated, but we've strongly recommended they
give it a try," Page said. "Quite frankly, travelers still find it
easier to call or send an email."
Other midmarket buyers are dealing with online booking on a
global scale. Laurie Etcheverry, corporate travel manager for business media
company IHS Inc., has built policies into online booking tools in several
markets worldwide. North American travelers book through Concur, while
travelers in the United Kingdom, Switzerland, France, Germany and Singapore use
Amadeus e-Travel. Travelers in Japan use a booking tool supplied by Carlson
Wagonlit Travel.
IHS' online adoption stands at about 85 percent in the
United States and Canada and at about 65 percent for most countries using
e-Travel, except for lower levels in the United Kingdom, Etcheverry said. "We
really push online booking for simple trips," she said. "We put it
out there that using the online booking tool saves in transaction fees and
saves the company money, and we want people to realize that spending the
company's money is like spending your own money."
Embracing Online
Expense
The majority of small and midmarket survey respondents
indicated they use a third-party or internally developed system to report
expenses electronically. Only 5 percent of midmarket buyers and 22 percent of
small-market buyers said they have no plans to implement such a tool within the
next few years.
Even so, Concur's Marks said Excel files and other
paper-based processes remain the most common way most small businesses file
expense reports. That slowly is shifting as more tailored tools—scaled-down and
cloud-based versions, for example—become available, which also has lowered the
entry price for implementation.
McCormick switched to an automated expense reporting tool
when it introduced its online booking tool, replacing a phone-based system for
expense management. Page said it has made the process significantly easier for
travelers. Merging expense and booking data streams ultimately will make it
easier for her to issue reports to senior management showing overall spend by
business units and savings opportunities, she said.
Infinite Campus' Neau said her company's use of Concur for
expense reporting is one of the few instances in which it uses a third-party
product instead of its own, as its general ledger is not set up to track travel
spending correctly.
"It's really the best way for us to get a handle on
reporting and track all the various pieces of travel spend," she said. "It
can also help us reassess issues with our current general ledger and rebuild
that."
IHS' Etcheverry said her company is working to consolidate
several tools and processes onto a single global expense platform, with a
year-end target for completion.
Mobile technology also is helping to propel adoption of
automated expense tools among small and midmarket buyers, Marks said. Since the
vast majority of business travelers carry smartphones or tablets, implementing
expense tools with mobile capabilities makes more seamless adoption easier, he
said. "At the very least, they're using the mobile app to capture receipt
images," he said.
Buyers Seek
Actionable Data
Regardless of how SME buyers manage bookings and expenses,
many crave regular reporting, both pre- and post-trip, and data that can
directly benefit the procurement process. "We're seeing a shift from
canned reports to those on spend and what department spent what, who are the
top travelers and top markets—more actionable data," Atlas Travel
president Elaine Osgood said. "We're trying to figure out how to bring
even more actionable data to the point of sale, where, for example, agents can
say, 'You have too many passengers on that flight.' "
Ultramar Travel Management chairman and CEO Peter Klebanow
said even his smallest corporate clients get monthly standard program reports.
Midmarket buyers ask for more customized reports, along with analysis and
meetings to review them.
TMCs catering to small and midmarket buyers said these
reports largely are for exception reporting, most frequently checking for
lowest fare usage. For smaller companies, that sometimes requires reviewing the
actions of only a few travelers.
"They only need to look at a fraction of the employee
base to find 80 percent of those exceptions," said Casto Travel Management
president and COO Marc Casto. "They look at fare savings, general travel management
savings and the exception reporting itself."
This report
originally appeared in the April 16, 2012, edition of Business Travel News.