Buyers Pushing TMCs For Faster Switchovers

Corporations switching travel agencies increasingly are seeking faster implementation times, yielding more beneficial financial arrangements and lower changeover costs. To meet their demands, travel management companies are altering new account strategies, redeploying resources and bolstering implementation teams.

Historically, U.S. and other single-country rollouts for new travel management company clients take about 90 days, with multinational deployments spanning up to a year. Those timelines have now shrunk for some accounts from one-third to as much as one-half of that. In some extreme cases, corporations are requiring agency cutovers in less than 30 days. Travel and Transport president and CEO Bill Tech said a recently won multinational account with $25 million in air volume required an 18-day implementation. Such cases are rare, as some travel management companies do not have or will not commit the resources to such a timeframe, but in all compressed implementations travel management companies are forced to muster an all-hands-on-deck attitude to get the account running.

BCD Travel CEO Joop Drechsel said average implementation times recently have been cut from 90 to 60 days, which requires as many as 50 people to successfully support.

With average implementations down to about 45 to 60 days, Travelocity Business in January overhauled its previous installation strategy to add more communications and marketing processes and reprioritize its tactical steps. Before going live, TBiz now ensures travel department integration with human resources data feeds and that policy and supplier contracts are complete and loaded. Program marketing and communications also have ramped up. Travel manager communications now are segmented by such subject matter as technology so there are less time-consuming meetings. Training programs also changed, with agents now required to pass a new client certification test prior to implementation.

"You have to be spot-on," said TBiz vice president of global sales and account management DeAnne Dale. "If you have a bad startup, you are not going to have a good year with that client."

Carlson Wagonlit Travel has bolstered its implementation teams in regions including Latin America and is standardizing its implementation strategy worldwide. The TMC has a team of three global and about 40 regional project managers.

Even more complex global TMC rollouts are being compressed. Now, multiple countries are done in waves, with whole programs completed in six months in some cases, said CWT vice president of global implementations Kathy Kent.

Travel agency network Radius uses a centralized implementation team of six with regional and local support from its shareholder agencies. In shortened multinational implementations, Radius prioritizes a few countries in the first 30 to 45 days, then brings smaller countries on later in the process, but standard rollout periods are at least 90 days, according to vice president of global sales and services Kieran Hartwell. "We are really analyzing that time, what it means and how much of it we can squeeze down into a shorter timeframe," he said.

As in the case of Travel and Transport's 18-day cutover, some incumbent agencies that lose a U.S.-based account are refusing to extend the contract for a few months or are significantly hiking up the prorated price. In turn, those accounts change agencies, requiring frenzied implementations. "Then, you implement to a certain level as much as you can for offline so they can at least make bookings. In the following 60 days, you concentrate on all the other stuff," said Hartwell, who has seen this happen in Europe and Asia/Pacific.

Although savings may be achieved through shorter cutover times, quicker wins are not free of pitfalls, like a lack of all necessary data from human resources, less traveler buy-in and more supplier rate-loading errors and gaps.

"Each supplier has their standard timeline. It's usually more than 30 days to get the rates loaded in the GDS and the new pseudo-city codes," Kent said. "Some are able to adapt more easily than others. It really depends on the level of preference that the client has with the supplier."

An integral part of the TMC change management process is communications, including e-mails, seminars and training programs. In a shortened span, the amount of messages buyers can send to employees is limited. Kent said the typical communications period is four to six weeks, but compressed implementations require less communication and training before rollout.

"Then you are relying on travelers to actually read the communication and then take action," Kent said.

Like most corporate travel management processes, implementing a quicker change management process comes down to senior management support.

"Some clients are only moderately engaged, and we've had to repeat the process a couple of times," said Egencia vice president of account management and meetings Stan Sorensen. "We've launched and are still out there 30 days after launch trying to pick up the pieces on the training."

As procurement has taken a larger role over travel and corporations are seeking savings today more than ever, an increasing amount of agency cutover plans are completed according to schedule. "Procurement is more involved, so it's much more disciplined than in the past," CWT's Kent said. "There is a lot more focus on making these changes, getting through the process and validating that their supplier is the one they want, so they can move forward with additional savings plans and policy modification and gain momentum."

While a travel department and its new agency may be ready to hit the road at full speed, other departments, such as legal, may not be, thus stalling the process. "Quite often, we are being pushed to implement a piece of business, but we're not very comfortable doing that until we've at least got a letter of intent or the contract signed," Radius' Hartwell said.

To help mitigate the process, buyers need to begin working with other departments early and often, including legal and information technology staff who need to evaluate and link corporate technology with travel management company systems. Salesforce.com director of global travel Ralph Colunga said, "It's absolutely essential to engage with IT teams to ensure all requirements from data privacy to integration of systems, especially in this day and age, when there are so many cutbacks on the IT side. It's absolutely something you have to get on your radar screen sooner than later."