This week KDS announced two enhancements to its product that make possible its dream of total online travel and expense (T&E) management
Business travellers are well versed in the sometimes complicated process of expense management. Asking taxi drivers for receipts, having supplier invoices sent through weeks after a trip and coping with billbacks are but a few hurdles the wary corporate traveller faces when trying to control costs. But total expense management begins much earlier on, at the booking stage. KDS, the Paris-based travel technology company, argues that it makes sense for the entire process to be managed from start to finish in one place - and that place is online.
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| Yves Weisselberger |
At a workshop held this week, Yves Weisselberger, KDS' ceo, compared 100% online T&E management to a coveted and legendary relic.
He said: "The concept is that we want to reach the holy grail of managing the whole travel and expense spend in a single place and have absolutely no leakage. We want to deliver a complete set of data and to manage the complete process in a way that goes beyond adding only travel and expense."
As Mr Weisselberger and others from KDS claim, many corporate customers still book much of their travel over the telephone, passing much of the responsibility on to travel management companies (TMCs) such as Carlson Wagonlit Travel (CWT) and American Express Business Travel.
KDS's UK sales director Matthew Frost acknowledged the role of the TMC, experts in managing complex multi-leg business trips and finding the most cost-effective itinerary. Indeed Mr Frost was keen to point out that while 100% online adoption could take away agency fees, TMCs would still be heavily involved. "The volume of our business comes from the TMCs which use KDS solutions," he said.
In order for KDS to achieve its goal, two new modules were formally unveiled called Total Travel and Invoice Reconciliation, each enhancing both the first and last stages in the T&E process.
As Mr Frost explained, Total Travel aims to help corporate travellers book any journey, regardless of complexity, online without the need to pick up the phone and speak to an agent. Complicated, multi-leg journeys are still routed to an agent, but all within the online environment.
"One of the big barriers that we see to 100% adoption in our UK customer base is a slightly ambiguous message that we have as online bookers, and that is ‘book your point-to-point travel online, but if it gets complicated pick up the phone'.
"For those that understand the travel industry it's easy to see that for multi-leg travel you don't always get the best deals. It's confusing and that's where TMCs come in. What Total Travel does is remove that initial ambiguity. It lets you build a complex trip online, and then lets an agency do what an agency is good at, which is pricing it and suggesting alternatives for the best point-to-point alternative," he said.
According to KDS, complex requests are routed to an agent who proposes options to the traveller within the online tool. By routing bookings, "policy is enforced, costs are monitored and data capture is complete."
The second important enhancement, Invoice Reconciliation, is designed to tackle the tricky subject of invoices and pockets filled with receipts. Restaurant and "entertainment" bills, for example, can be entered into the system and automatically matched against an itemised travel itinerary. Invoice Reconciliation can also handle billbacks, or extra, unforeseen hotel charges, a source of much confusion between TMCs and their clients.
Mr Frost said: "The challenge with integrating that into an expense process is that not all expenses are related to travel, not all come on card or cash, and some come by invoice or via billback. We now have a solution for that.
"These features and enhancements are quite important now, and are rising up the corporate agenda. We're seeing a lot more interest in these issues."
Mr Weisselberger furthered the idea that T&E management was increasingly important in a global economy racked by recession, and increasingly focused on cost saving measures.
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| Michael Frost |
"Tough times are the best periods to continue to innovate and the reason we can do that now is we have some challenges around for companies and suppliers in this industry," he said. "Players in the selling, distribution, travel and expense world, more than ever, have to define what they do, their place and their added value. We have to refine that, and continuously show that we deserve to exist."
T&E can represent between 2-8% of a company's annual revenue, Mr Weisselberger said, and the third highest "non-productive" spends after salaries and rentals. Saving money on T&E could represent 4-5% of a company's operating margin, Mr Weisselberger claimed.
The drive to save costs has brought online travel booking back into the limelight, with corporates attracted by the ability to control purchases completely.
"In a sense we're in almost a second wave of adoption of online technology because of the credit crunch," said Mr Frost. "We're in a phase now where people are trying to manage their travel budgets down, but they're trying to do it by control and in a smarter way than the sledge hammer approach, and online travel has come back onto the agenda in a much stronger way."
Mr Frost argued that companies were increasingly enforcing strict online travel mandates, regardless of the importance of an individual. But he also acknowledged that people are travelling less, offsetting online adoption.
"We've seen two conflicting trends," said Mr Frost. "People travel less, very bad for us; people book online more, very good. Net-wise, we've seen an overall rise in transactions."
It seems KDS is not threatened by the global recession and its impact on business travel, which has suffered greatly over the last 12 months. According to Mr Weisselberger, KDS has a 30% market share of all online business travel bookings made in Europe, and 14% worldwide. On average, all the air travellers booking through KDS could fill 120 passenger jets every day.
Mr Weisselberger and Mr Frost both hope that total online adoption will help drive KDS's transactions further still, despite fewer individuals travelling.