In order to accomplish this, we have a Departmental travel contact for the agency’s Bureaus that assits. After that, we verify with Civilian Board of Contract Appeals that adjudicates travel claims. Cases are submitted to a panel of judges for case determination. Ruling can be cited on decided cases as a basis for us or any agency to substiantiate or deny a travel claim.

Another recourse is to contact the General Services Administration directly since they promulgate the FTR.

Our Helpdesk staff are able to answer general travel policy questions from the FTR and/or agency policy. Since we have about 40 customers, this is a real challenge to keep all the separate agency items understandable for our agents. We also maintain a smaller staff to research complex travel policy questions as well as to ensure travel policy is correctly presented in our E-Gov Travel system. This area also creates and updates travel policy information on our customer websites as things change.

By Daniel Carozza

“The views expressed are those of the author and do not necessarily reflect the position of the Bureau of the Public Debt, or the U.S. Department of the Treasury.”

However, all corporate preferred travel programs experience some leakage at one point or another.   The loss of transactions through the corporations recommended reservation system or the loss of spend and performance with the contracted suppliers proves difficult for both the buyer and supplier side.   Controlling slippage to achieve contracted terms and policy compliance is fundamental to effective travel management.   The most important key is to communicate to travelers the emphasis on policy and reasons for compliance.

Most travelers do not understand loss of market share or loss of transactions, they care about seeking the better deal and perhaps doing the company a favor.  Travelers are not realizing the company is losing the ability to track spend which weakens future negotiations with vendors, much less the program benefits associated with preferred rates.   A common argument for employees using an alternative website or alternate TMC for booking air is they are perceived to be booking a cheaper airfare or avoiding a transaction fee.  What they may not know when using an alternate website is the pricing does not include taxes and other up- front fees.

Hotels seem to be the largest area of slippage for many companies.  According to recent publications, only fifty percent of hotel bookings are captured through travel management companies.    This is attributed to hotels offering rates through leisure sites and frequent stay membership perks that employees feel they will not receive if booked through their travel management company (TMC).   Employees also think they are getting better deals with car rental companies whose leisure rates may be lower – but they do not include the insurance coverage that should be required for all renting employees.

The answer to the problem is measuring the extent of the leakage and implementing a plan to control it.   The first step is to find out the percentage of leakage through the company’s expense reporting tool.  This will show, through original receipts, how much of the travel was purchased outside of the travel program.  For example, all hotel folios can be matched up with passenger name records (PNR) history, the airline receipts will show the dedicated airline reporting corporation (ARC) information indicating the airline ticket was purchased through the TMC and the rental car will show the designated corporate ID on the receipt.  All these elements will give you an excellent indication of who is following processes and procedures.  Or, if original receipts are not required by the organization, using available data through the TMC, credit card and vendors to find the source of purchase is necessary to track and educate.  This provides the ability to measure travel policy compliance by aggregating and comparing credit card data against your travel data.

Once the offenders are determined, the second step to reduce or control leakage is to develop a well thought-out communication program between upper management and the employees.  By showing upper management the negative impact to the program, you have better buy-in and the support you need.  When word comes from the top, employees will listen.   The employee must understand that they will forfeit his/her right to the following benefits provided through the company’s managed travel program:

• Insurance Coverage - Travel Accident Insurance is typically provided by the TMC in addition to the corporation’s own insurance.
• Profile Information - Specific profile information (i.e. frequent flyer, special requirements, etc.) on file with the TMC will not automatically be available to the travel vendors.
• Reservation Assistance - Flight cancellations, changes and refunds must be processed by the traveling employee through the channels in which they purchased their travel, as the TMC or the travel department are unable to assist travelers with reservations made outside of the managed travel program.
• Receipts - Ticket receipts, itineraries and copies of either, will not be available from the TMC.
• Employee Tracking - Employees will be responsible for advising managers, corporate security and the travel departments of their travel plans to ensure safety and security of the employee.
• Reconciliation Assistance - Due to lack of insight into travelers’ records, reconciliation assistance provided by TMC and/or the travel department is diminished.
• Unused Tickets - Employees will be responsible to ensure unused tickets purchased through alternate websites are used towards future business trips.  Reimbursement of unused tickets can be delayed.

In addition to the communication plan, restrictions can be applied to both on-line bookings and off-line bookings and reinforced when rules are broken.  When employees are educated on the benefits of their company’s managed travel program, they are more likely make better decisions and in turn, improve compliance and cost savings.

by Stefanie Tretola

Their main technology, the ARC Document Retrieval System launched in 2001, allows travel agents and carriers to access summaries and details of millions of airline ticket transactions over the Web. Prior to the availability of the ARC Document Retrieval System, agents and carriers had to rely on paper copies of ticket documents, microfiche and back-office systems to research ticket information for all of these transactions.  ARC has centralized and simplified industry reporting in virtually every internal decision-making and workflow function. With the capability to archive and display 39 months of transaction data, made accessible on-line at all times, ARC Document Retrieval System has become the nucleus of travel industry information.   The result is significant tangible and intangible cost reductions.

While most data warehouses are internally focused on sales, customer behavior, and supply chain optimization, ARC’s vision was to provide a travel industry solution to customers and give them the resources of an industry data warehouse.  ARC offers more than 60 revenue-generating reporting products, and launches five new revenue-generating products each year.

Benefits of ARC data reports created for external customers in the travel industry include

• create targeted marketing plans,
• assess incentive programs,
• optimize promotions,
• offers insight for route and network planning,
• sales trends,
• customer behavior,
• demand forecasts,
• statistical profiles,
• point of sale analysis,
• targeted marketing campaigns

ARC introduced its Electronic Credit Card Billing (ECCB) in 1989, and in 1996 ECCB became part of the daily billing process.  It was the first organization in the industry to comply with the payment card industry data security standard, and also complies with the European Union Safe Harbor program.

ARC is the cornerstone of the air travel industry, an integral part to its success and future. It offers the best settlement engine, is the recognized industry data store, and is the premier provider of industry knowledge and insight. Using increasingly sophisticated electronic means for ticket distribution, reporting, and remittance, these points of sale are responsible for air and rail sales of nearly $70 billion a year.

By Crystal Wright

References

• http://www.tdwi.org/research/display.aspx?id=8520
• http://www.arccorp.com/index.html
• http://www.nytimes.com/2007/09/18/business/18tickets.html?ex=1347768000&en=f1d65893d343701d&ei=5088&partner=rssnyt&emc=rss

I am employed with a reputable and rapidly growing Travel Management Center (TMC) which is accredited by ARC and has been in operation for 30 years. It has been exciting to be involved in such a diverse and fast paced environment which brings new and unique challenges each day.

Our clients include family vacationers, small and locally owned businesses and large corporations and government agencies. It truly requires special knowledge and understanding of a TMC’s leaders to constantly and properly balance the vastly different needs of clients in such a changing world of travel.

Our TMC utilizes the best technology available to the industry and employs some of the most experienced travel agents that can be found.  Our strong reputation is a result of our high customer service ratings, close communications with employees and dedicated leaders of integrity.

My job responsibilities consist of being of assistance to the account managers in the government department so that they may focus more on managing employees to ensure customer satisfaction. I am also responsible for resolving debit memos for our department which allows me to work closely with the accounting department.  Although receiving debit memo’s is certainly not a pleasant issue for anyone involved I have learned that monitoring memo’s daily and constantly working to resolve those that are outstanding is highly advantageous.  Also, properly reporting the status, reasons for issuance and finding ways to prevent debit memo’s results in better TMC and airline relations. The one thing that I most dislike about working with debit memos is the reality of agent errors for my agent co-workers.  Although agent errors many times result in the amount of the memo being paid by the agent I am always and continually hopeful that the errors will ultimately result in raising awareness of rules and regulations imposed by the airlines and prevent costly errors while also improving reservation accuracy.

I am thankful for my employer.  Not only are we good at what we do we also stay largely involved in community activities such as fund raisers to help local schools, Christmas charities, heart walks, and just helping the needy in our community in general. This TMC is one that I am really proud to be a part of.

By Michelle Kennard

We are glad that our chosen E-Gov Travel vendor recently allowed more TMCs to participate in E-Gov Travel.

Prior to E-Gov Travel, we created our own independent contract for travel management services, since the existing GSA contract was non-mandatory.

One thing the travelers find cumbersome is the fee process. It’s difficult for the infrequent government traveler to know the difference between the TMC fee and the TAV (travel authorization and voucher) fee. Currently ETS uses a TAV fee for each completed voucher in addition to the TMC fee. In studying for this class, it was pointed out in the material that DTS has the ability to charge a management fee based on the number of vouchers created rather than charging a separate TAV fee to each traveler’s document. I hope this is applied later on to ETS as well.

By Daniel Carozza

“The views expressed are those of the author and do not necessarily reflect the positon of the Bureau of the Public Debt, or the U.S. Department of the Treasury.” 

IATA by the way is the organization that established the 3 letter codes for airports that is used to identify to make bookings (PNRS) in GDS or facilitate bag connections.

The FTR are accessible through the GDS.

Those agents that wish to work with the Government must have certain capabilities to function and perform the services required like:

• Corporate/Government experience to conduct official travel services
• Past performance will allow the government to assess their quality.
• Describe the way they do Day-to-day operations and how they manage that.
• Fulfilling the Scope of Work in technology, reservations, profile keeping, ticketing, emergency services, compliance with Fly America Act and many other capabilities that are mentioned in the RFP.

 Commissions and Transactions Fees:

Once the airlines phased out paying commissions to Travel Agents, those agents in order to maintain their operations resorted to collect the lost income by imposing a system of fees whether management fees or transaction fees as it is logical that they cannot do their jobs for nothing.

Transaction fees are a complex issue. It requires a lot of calculations modules. Each travel agent has his unique way of doing these calculations that might be based on :

• Real and actual experience
• Standard accounting procedures
• Travel industry trends
• Risk assessment
• Industry statistical data from either ARC or IATA.

Management fees could be a lump sum figure for the whole travel services during a month.

Contracting:

Government contracting for travel management services began in early 80’s when a pre-world war 1 prohibition on the use of travel agent services was removed. Those accredited travel agents, once they are under contract to the Government, DoD calls them Commercial Travel Office (CTO) and GSA calls them Travel Management Center (TMC).

There are two methods of contracting for government travel services.

The DoD issue an RFP and GSA Travel Services Solutions (TSS) Multiple Award Schedule (MAS). The awarding of services will go to the winners with the experience, professional accreditation and specific capabilities.

The other method of contracting is Full & Open competition for TMC or CTO to conduct Government travel services. Government will issue a task force order sent to 3 schedule contractors for bids. The best one with value and price is usually selected. Also the Government will always put aside some contracts for small businesses. Large contractors are encouraged to subcontract to small businesses. The TSS Schedule RFP means travel agents have 90-120 days to respond to a bid.

The prices offered are firm however after one year, the governemtn can look into an EPA (Economic Price Adjustment) if needed. The terms for EPA must be negotiated before awarding the contract.

Once a bid has been awarded, implementation starts from dealing with a Project Manager to serve as a single point of reference to oversee all activities of starting the new TMC or CTO or in some cases just a renewal of contract.  If a contractor is being replaced then the new one must work along the old one to have a smooth transition with little inconvenience to travelers.

There are several implementation steps like: Project award, meeting with contractors, assurance of TMC/CTO accreditation, site visits, hiring and training of personnel, equipment, contract start date and any other step needed or come along.

There should be a test run for all activities before the start date.

Once TMCs/CTOs are functioning then they will be using GDS which are called front office. TMCs/CTOs reporting systems linked to GDS data like: Airline ticketing, Hotel Bookings, Car Rentals, Destinations, Fares and other data like CPP usage, CPP expense, unused tickets to provide full reporting to the government.

By: Metri Altwal

Due to the many tickets that are written off due to lack of re-use or not recalled by the TMC, our organization needed to come up with a sure fire way to use up the hundreds of tickets before they expire.   We have incorporated these unused non-refundable tickets directly into the travelers profile to ensure these “credits” will be used toward the next trip.  We have done this by using a scraping method of the GDS by looking for our ARC numbers and then compiling a report.  The report is then uploaded into the travelers’ profile each week for all users who have access to their profile to see.

In the past, these tickets weren’t as accessible and the process to create a report was cumbersome and slow.  This inhibited travelers or arrangers from accessing a reliable database of unused tickets.  Often, the TMC didn’t have accurate information, especially on partially used tickets.

Since the majority of our tickets are issued through our on-line booking tool, we now anticipate that the current bank of over $500K will deplete because of the obvious visibility into these tickets.  The new system actually prompts the traveler or arranger to use up the tickets for that traveler, if at all possible.

It is our goal to deplete the file by 50% by the end of the fiscal year.   Stay tuned…..

by Stefanie Tretola

The federal government has not been able to accurately identify its annual travel spend which exceeds $15.4B a year.  An Accenture study found $7B a year in unknown types of travel expenditures, and a difference of over 50% in the travel expenses recorded on the federally mandated SmartPay travel card from expenses recorded in the President’s Budget Object Class 21 (Travel and Transportation of Persons) as submitted by federal agencies.  In the past, the Government has been unable to capture spend, determine the value of the spend, and to determine the level of compliance with federal travel programs.  The inability to know how much has actually been spent on travel means that it cannot effectively be managed.  The Government’s approximately $15.4B a year in travel spending is subject to unknown inefficiencies and costs.  The Government’s inability to wade through a morass of incomplete data from various sources has seriously hampered its ability to effectively negotiate with stakeholders in the City Pairs program among other things.

The intent of the TRX MIS contract was to provide comprehensive data on Government travel for most if not all GDS, and other travel data collection systems.  Market research was performed and the requirements for the MIS system originally were drafted from both DOD (DTMO) and the civilian agencies.  GSA evaluated the proposals and awarded the contract to TRX for the MIS initiative.

This contract provides for the first time the ability to capture and aggregate comprehensive travel data for the federal government.  This will include travel made through the Travel Management Centers (TMCs), through the ETS solutions, through the SmartPay charge card, and directly with suppliers.  A multi-year, phased in approach is being used to mitigate risks associated with technical development, integration, and minimize costs to the government.

Once the government has aggregated its travel data through a central repository for such data as the contractor provides, reports can be generated that will provide management information regarding government travel.  TRX has provided their services to numerous commercial companies which have resulted in the development of a suite of ready-to-use travel management reports.  The government will now be able to use these same reports which have given companies in the commercial marketplace the ability to better manage their travel.

Additionally, custom reports specifically tailored for the government environment are being developed for use by the federal agencies and their stakeholders.  This will include the travel reporting Information profile (TRIP) report which is a statutory requirement.  It is important to note that relocation data and the cost of administering travel is not available from the solution since it is not accumulated electronically in the available data sources at this time.

Initially it was thought that the main objections in delaying implementation would come from the airlines and vendors providing the GDS data links to the government vendor.  As it turned out, and much to everyone’s surprise, most of the delays resulted from other vendors who did not provide timely, accurate, and complete data feeds.

Initial data feeds were also somewhat delayed as additional security requirements were implemented to incorporate personally identifiable information (PII) transmission.  These requirements ensure the secure transmission of the data through an encrypted portal called Dataman.  There were some unexpected challenges regarding security on the Government side as an Authority to Operate (ATO) certificate was required to secure these records.

The rights to all of the data remains with the government, and the deployment of a third party aggregator provides the necessary consolidation of aggregated data, standardized processes, and streamlined reporting requirements.  It also provides a steady data stream necessary to accomplish strategic sourcing of services.  This process will also unencumber each of the TMC’s from trying to meet regulatory requirements processes reports such as TRIP reports and Premium Class Travel Reports.

GSA addressed the only other objection to providing this data by providing free software to transmit already available back-office data to GSA.  Although this software was originally intended primarily to ease the transmission of data from smaller TCS it is now widely used for most of the TMC data feeds as a more secure method of data transfer.  GSA also provided no-cost technical support for the system.  DataMan extracts data from back-office systems and transmits it directly to the TRX MIS system – 256k encrypted.   It is secure and automated, easily configurable, and the smaller TMC subcontractors/vendors that provided data with it to date are happy with it.  It sends the data automatically every month and requires no human intervention once set up.  At this point in time data is collected monthly and will not include some of the IBA data.  As the ATO is granted – one years worth of data will be collected to include PII as requested by the Government Agency.  TRX rolled out the pilot of the system for government wide use on 12/15/08.

Included in the MIS is the ability to perform analysis of strategic sourcing opportunities.  The capability was exercised this past year as an analysis was performed upon the request of the airline carriers.  The carriers wanted to enforce a ticketing time limit to purchase seven days prior to departure of within twenty-four hours, if within the seven day period.  This would, the carriers claimed, allow the airlines the ability to resell their seats in a timely manner to the general public and to ensure revenue opportunities were available at every juncture.

It was important to have a solution to analyze the substantial amount of  data available and provide a significant response to the request.  For the first time the government was able to view data patterns not readily seen, for instance:  Twelve percent (12%) of all airline tickets are issued for the same day of travel.  Airlines have also added several fees (fuel surcharge, baggage and interactive fees for such things as telephonic reservations and ticketing at the airline counter, etc.) to the  price of the ticket.

Under the TRX contract GSA was able to review the entire download of FY 2007 ARC airline travel data in order to preview the caliber of information that might be expected under the TRX MIS contract.  Upon review, the analysis showed 72% of government travel spend either used a TCA or CA fare on City Pair contract tickets.  76% of the segments were also City Pair routes.  An additional 16% used DG (discounted government fares), so 88% of tickets purchased were actually Government fares.  Commercial fares were used 12% of the time either as lower than contract fares, or because they were in markets not serviced by City Pair fares.  Data from ARC was broken by origin and destination, by passenger count and fare basis by passenger count.  This analysis indicated a high rate of compliance with the City pairs contract policy and showed the government to be a strong proponent of the program.  The analysis supported the government’s contention that we were a valuable customer to the airlines, as in the instances noted, the Government actually helped to fill seats for the carriers at the last minute and at an acceptable yield to the airlines.

TRX data will eventually also provide the Government with additional critical data for effectively managing other areas of their contracts.  This data is sorely needed, since prior to this time, there was  no way to efficiently manage the effectiveness of the programs nor that business activities were actually being conducted in the best interests of their customer, the U.S. Government.

New  analytical capabilities are expected to realize significant improvements for strategic sourcing, utilization of federal travel programs, compliance with federal travel policy, and travel spend data.  New benefits will include:

• Improved travel supplier agreements that provide best cost and quality choices.
• Improved use of existing programs that maximize cost savings and flexibility.
• Increased compliance with travel policy and new policy creation, improving adherence to the Federal Travel Regulation (FTR).
• Near real-time travel usage and pattern information analyses allowing for adjustments and changes in travel management that provide the required response to the needs of the federal traveler.

In conclusion, despite some unanticipated obstacles, the MIS has been launched and is now available for GSA and Government-wide use for the benefit of our government travelers, and the success of our government programs.  The data aggregation and information analyses it yields will be invaluable as GSA continues to improve strategic sourcing under the City Pairs programs, and to monitor and adjust policy to ensure compliance with the FTR and associated regulations.

by Julie Speers