After travel savings, what's the next big thing?

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KeleMohatle.JPGFor travel buyers who have gone online and realised the savings offered by online booking tools (OBTs) what is the next best thing?

Is it expense management integration?

This next step offers accurate reporting, recon and budget management, argues Kele Mohatle, CEO of travel procurement consultancy NaKo Consulting, in this month’s SmartProcurement.

OBTs are relevant to the effectiveness and efficiency of any corporate travel procurement programme that is considering more savings opportunities, policy compliance, empowering internal clients and aligning to best practices.

However, the needs of OBT clients have changed over the years - driven by cost containment and accurate, real-time reporting. To a large degree it has become all about the data, says Mohatle.

“Consequently, for clients already making full use of OBT (i.e. enjoying seamless and effective processes, realizing savings and consistently containing costs) reporting is the next big hurdle,” she says.

A challenge for corporates is aligning OBT report information (typically particular figures over a 12-month period) with the Finance Team’s different report requirements, especially at budgeting time.

A gap identified by many corporates is the accurateness of Total Cost of Trip (TCT): a Travel Manager will produce invoiced reports while Finance will produce invoiced inclusive of post-trip expense claims.

“This can be a nightmare for any CFO, especially if some of these post-trip expense claims need to be billed back to clients,” explains Mohatle.

Consequently, while cost containment and expense management is crucial for corporates using an OBT, it is the possibility of integration with an Enterprise Resource Planning (ERP) system that will make an OBT a winner.

OBT suppliers have responded with smarter, more seamless booking processes that include expense management tools.

Some OBTs can integrate with corporate ERP systems depending on the available infrastructure capability and the sophistication of both tools, says Mohatle.

However, the costs associated with integrating with ERPs and adding expense management tools can be deal breakers. Also, the capability of a corporate’s infrastructure to accommodate these developments must be considered.

Meanwhile, Mohatle noted that the above Travel Procurement scenario is regarded as Managed Travel 1.0; **the future is Managed Travel 2.0 (seen more in Global markets) which allows travellers:
1. to shop anywhere for their trips;
2. book at any platform as long as the Travel Manager gets the data;
3. book any supplier as long as the supplier is regarded as safe;
4. as long as they within budget; and
5. can make use of the corporate card.

**This was shared and presented by US based Industry consultant Scott Gillespie at the 2012 ITMSA conference.

Mohatle believes that these travel procurement programmes are guided by corporate culture, traveller behaviour and infrastructure level.

For more information contact Kele Mohatle at info@nakoconsultancy.co.za

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