By Microsoft Travel & Corporate . - Business Travel News

CORPORATE TRAVELINNOVATION MANIFESTOBy Microsoft Travel &Corporate Travel Innovation ParticipantsCorporate travel is a 1.3 trillion global industryleveraged by every major company on the planet tobuild success. The industry relies heavily ontechnology and processes that have not changedsignificantly in one, two or even three decades. Thisdocument is meant to stimulate conversation andaction to push the industry forward.conichiLegacy technology systems, entrenched intermediaries and lack of transparency incommercial relationships have hampered innovation in the corporate travel spacefor more than 15 years. The consumer travel experience—in terms of the process tobook and execute and pay for a trip—has outpaced the corporate experience, witheasy access to rich content, streamlined tools and content tailored to the individualtraveler. The inertia in the corporate space undermines the relevance of managingtravel for today's business travelers. It not only prevents corporates from providingenhanced traveler services, but also holds them back from optimizing fundamentalobjectives: duty of care, data security, employee productivity and savings.Microsoft Travel hosted its first Corporate Travel Innovation Summit in Lisbon lastfall, joined by forward thinking companies—both corporates and suppliers, to pushinnovation through the corporate travel industry as an outcome of that summit, thisdocument is submitted by the participants as an industry call to action.It is aimed specifically at corporate travel programs whose billions of travel dollarspower the corporate travel machine. We acknowledge that all travel buyers bringvalue to the industry and no one should be locked out of the innovation arc. Fromthat perspective, this document aims to demonstrate to all buyers what should bepossible in managed travel and to inspire them to push their suppliers—and theindustry—for better solutions for travelers and increased transparency forcorporate programs.The purpose of this document is to drive industry dialogue, but it should also putsuppliers, intermediaries and industry technology providers on notice thatcorporate travel demands are changing. Platforms, data models and commercialmodels must change to meet those demands.The companies listed above are a sampling of those that attended the inaugural Business Travel Innovation Summit hosted by MicrosoftTravel

THE TRAVELER EXPERIENCE IS EVERYTHINGMature companies no longer view travel as a cost center where the main programobjective is year-over-year cost avoidance. These programs have achieved nearoptimal value with suppliers and have shifted their focus to driving top line revenueand achieving more holistic value. This value ultimately boils down to the travelerexperience and productivity to support the business. Attracting and retaining thebest employees and keeping them productive, happy and healthy has a legitimatereturn on investment.When it comes to traveler experience, two major dynamics are at play. First,traveler expectations: Corporate travelers have grown accustomed to sophisticatedleisure travel tools. Not only are they exposed to rich travel content and mobileaccess, but suppliers have forged close relationships with travelers via loyaltyprogram profiles and can personalize content accordingly. Business travelers knowwhat is possible and they know they are not getting it from their corporate tools.Second, the function of the travel program to serve as an employee recruitment andretention tool: Fast-growing companies in technology, consulting, financial servicesand other verticals have recognized the travel program's power as an employeebenefit. However, they cannot realize the full value of that benefit without owningthe traveler as a customer and truly partnering with suppliers to define and deliverthe optimal experience.That experience isn't just enhanced traveler services. It incorporates the operationalexcellence that leads to productivity and savings, traveler duty of care and datasecurity. Corporates acknowledge that multiple providers are critical to provisioningservices, but the structure and delivery of the program must be defined by thecorporate. It cannot be predicated on the limitations of legacy systemdependencies, opaque commercial relationships, backdoor financial incentives andlocked up data.YESTERDAY'S MODELS UNDERMINE TODAY'S TRAVEL REQUIREMENTSUnfortunately, these are precisely the issues today. Global distribution systems havea stronghold on travel content through travel management company channels.While GDSs have opened application programming interfaces and are workingtoward achieving the International Air Transport Association's New DistributionCapability certification, they largely remain closed systems with limited contentthanks to high distribution costs that fewer suppliers are willing to bear.

Even so, GDSs keep their grip on TMCs as the primary managed travel contentchannel despite client demand for aggregated one-source content. They do it viabackdoor incentives funded by these distribution costs, particularly airlinedistribution charges. financial dependencies on GDS incentives leave TMCs eitherincapable or unwilling to explore newcontent and service models with clients.In Conversation: Corporate Travel Innovation ParticipantsGDS incentives are a longstanding issue.Hotel commissions have emerged as amore recent conflict of interest at theTMC, with reports of mega TMCsleveraging their buying power torenegotiate commission rates with hotelchains after corporates finalize theiragreements, thus allowing agencies torebalance financial benefits and biasingagents towards suppliers that will maximize TMC revenue streams. They've alsoused third-party re-shopping tools like Tripbam to re-shop only the hotel cohortsthat are commissionable to them rather than all comparable hotels in a market.“We have a really large corporate in [Europe] that wants to[initiate a new content model] to improve content deliveryto the booking agent. They went to the TMC and said theywould pay [for the agents to service the bookings] becausethey would have to move to a different flow to touch thebooking. But the TMC said no; they don't even want to bepaid for it.”These types of conflicts leave corporates wondering exactly who is the primaryclient in the buyer-supplier relationship—is it the corporate or is it the TMC? Plus,they boil down to financial inefficiencies for the travel program, with the lack oftransparency sowing seeds of mistrust in the corporate toward the intermediary. Inreality, mature corporates acknowledge the TMC is providing real value for theprogram, but they demand transparency into revenue streams to understand whatthey are paying for; they also acknowledge need for financially stable partners andwant to pay for the services and support that will drive towards corporateobjectives.From the TMC, in particular, the mostimportant services will be enhancedIn Conversation: Corporate Travel Innovation Participantstraveler services and duty of careduring irregular operations or“I think you can allow legacy to hold you back or you canemergency situations, but they arefind solutions out there that challenge the legacy. I don't letunlikely to be achieved in traditionalany of it hold us back because we'll try and find a solutionways. Corporates want artificialsomewhere now. There's a reason why we've got 70intelligence-supported solutions fromdifferent companies on a list, and 35 that we're activelythe agencies as well as from the onlineengaging with, because we don't want to be inhibited.”booking tools they offer, eitherproprietary or from third parties. Thesesolutions promise the democratizationof personalized recommendations and services that has thrived outside managedtravel in both consumer travel and other retail markets.

The requirements for these solutions will overlap with changes in contentdistribution models and a move toward open booking workflows. Corporates will belooking to TMCs to figure out how to touch reservations not made in the channel.GDSs and TMCs will need to work with clients on alternative models or they canexpect large corporates, in particular, to establish direct relationships with moreinnovative suppliers and new entrant companies that are capable of answeringthese demands.TMCs aren't the only intermediariesin question. Payment platforms, too,with merchant fees, crossborder“Hotel commissions would go away if corporates start tofees and transaction fees on thebook direct. We want to solve the guest experience andnetwork, parse out percentagesprovide them with better tools to enjoy their travel.across multiple stakeholders in theWhatever we can do on the back end—if that means givingpayment chain. New technologies[select corporates] unfettered access to data—not alike blockchain demonstrate howproblem. We have platform services available that facilitatesmature companies may movethat now, we didn't before, and we want to be on theforward to eliminate these baked-inforefront of blockchain and other payment and contractpayment costs, opting instead toinnovation.”forge direct payment relationshipswith trusted suppliers. Driving feesout of the payment process would potentially put millions up for grabs in largeprograms, opening space for buyers to negotiate lower rates predicated on directpayment agreements and suppliers still to realize increased revenue.In Conversation: Corporate Travel Innovation ParticipantsThe foundation for the future begins with data the industry already has, and withbasic capabilities already in play. We've seen companies create programmaticautomation on "if, then" capabilities to tackle issues like hotel attachments andadvanced air bookings. EY recently launched a "bot" programmed to chaseincomplete travel bookings across its 200,000-person traveler base. It pipes into itssystem both the TMC, booking tool and meeting registration data to determinewhich travelers require follow up messaging. Smaller programs than EY haveautomated data feeds to identify and chase both hotel attachment issues and noncompliant bookings and send emails to offending travelers. These are the right firststeps, corporations must take their data initiatives way beyond savings andcompliance to digitize the traveler. In a traveler-centric universe where managedtravel objectives role up into the traveler experience, the data has to reveal travelermotivations and needs.Microsoft Travel has begun this process by creating the role of global employeeexperience lead to understand the traveler as a customer. Because the experiencelead cannot get personal with tens of thousands of travelers, the role is largelydata driven, turning every traveler into his or her collective data and then clusteringtravelers with similar behaviors and preferences.