29 March 2009

GetThere Sets Out To Help Corps

Sabre's GetThere product group has launched this week the Demand Management Suite.

Effectively it is a package of products and processes that Sabre is standing behind with a money back guarantee. (Heck people will do just about anything for cash flow these days!)

Corporate Travel Management is bearing the brunt of the Recession's impact. Travel budgets have been slashed and now we are seeing the huge impact on the bottom line of airlines and corporate travel agencies world wide.

Sabre's tools, in my opinion will help if adopted in their entirety. However you don't need to drink all the Koolaid in one go. Just following common sense and keeping your policies in check will pay off in dividends of lowering cost and improving efficiency.

However there is still no substitute for the ultimate question that is only now being asked. What is the value of the trip and is the expense justifiable. In a metric based world this is almost impossible. Many moons ago, I led a team at PARS that developed such a tool. However no one was willing to accept a tool that actually assessed the trip in a price performance manner. Our design was based on the concept of a notional value that not only assessed the return on value of the trip as a whole but against different options. Set up took time but once implemented would have provided a key manner to operate a corporate travel budget.

For example if the value was positive it would have to have a value over 100. Thus a simple rule would be to say you can take the trip as long as the value proposition was positive to the company. In a financial belt tightening world the value ratio could be increased so that no one was able to take a trip if the value was less than say 120.

This would move away from a budget based world to a performance based world for corporate travel. While revolutionary still in today's world for travel - it is quite normal behavior for other functions - both revenue and cost - inside a corporation.

Sabre's solution is still based on the more conventional world of budget based rather than value/performance based. But it represents a model that both TMCs and Corporations should take a good look at.

Cutting for cutting sake is a downward spiral that leaves no winners. This is why I believe that we should be talking about Value and Performance not just for Corporations but for all the businesses in Travel.

So what do you think?


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