New Chapter, New Focus

It’s a tough time to say goodbye to all the great folks at ARC.  May 15th will be my last day there.

Like so many other fine firms, ARC is facing the pressures of the travel industry’s epic downturn. A special thanks to Mike Premo, Lauri Reishus, Dickie Oliver, Tom Casalino, Eric Barger, Doug Mangold,  Arun Gupta, Chuck Thackston, Ben Kean, Noah Robins, Vanny Zhang, Kristen Ebersole, Chuck Fischer, Shelly Younger, Sarah Boyd, Steve Solomon, Peter Abzug, Peter Kane, Megan Leader, John Pittman, Dan Swain, Heather Unger, Tanya Nass, Sofi Momen, Sohum Karia, Paul Barber, Brian Coleman and Rich Licato for your leadership, collegiality, insights and commitment to serving ARC’s customers. I am very grateful for the time I spent working with so many good people, and surely wish all of you well in your efforts to re-position ARC for the years ahead.

So what’s next?  It’s hard to imagine a bigger question than the one surrounding the travel industry’s recovery. There will be massive changes ahead, and that means plenty of opportunities for innovation.

This blog will focus  initially on the innovations and adaptations meant to bring about the travel industry’s recovery.  I’m curious to see what comes to market, and impatient to see what works.  If you’d like to share something along these lines, I’ll be at scott@tclara.com

NB: This blog’s title had been Gillespie’s Guide to Travel + Procurement. This blog has all of the prior posts, but the page menu has changed to reflect the new focus.

Innovative Boarding Method Could Save Big Bucks

Who says that innovation requires fancy new technology?  Jason Steffen, an astrophysicist, figured out a much faster way for passengers to board an airplane.  OK, so he did use a computer to model the problem, but the solution is elegantly simple.

Have a look at this demo in a 72-seat fuselage:

This article reports his modeling showed that even random boarding is faster than block boarding, something Southwest figured out a long time ago. Mr. Steffen estimates that his faster method of boarding could save a carrier more than $100 million a year, presumably from more efficient use of aircraft and less ground and crew time.

Hat tip to Frank Schnur for noting this on his LinkedIn page.

New Types of Hotel Rates Ahead

Let’s face it, it’s just a matter of time before hotels start offering non-refundable rates to corporations.  And you thought the hotel RFP process was already a pain in the butt.

Just wait until buyers have to try comparing a 10-day advance booking for a 20% discount at one property to a

Innovation and Patents: Pros and Cons for Procurement

Are patents good or bad for the end consumer?  OK, that’s pretty broad…how about this specific example concerning Virgin Atlantic and Delta Air Lines:

Virgin recently filed this patent infringement case against Delta over Delta’s use of a herringbone-style seating configuration in its BusinessFirst cabin. Virgin Complaint Against Delta

At issue is Virgin’s patent, granted by the U.S. Patent Office two years ago.

The implications for travel buyers are interesting.  Virgin came up with a clever way of arranging its seats in the business class cabin.  The advantages include easier access to the aisle, and more seats in the cabin for Virgin.

Airlines invest significant sums in their seating designs, and clearly hope to gain competitive advantages by doing so.  In this case, Virgin, by virtue of its patent, has the right to exclude other airlines from copying the features covered (claimed) in its patent. Less competition means some combination of more traffic and higher prices for Virgin.

Let’s set aside the issue of whether or not Delta is infringing this patent.  The facts are not clear, and Delta likely believes that either the Virgin patent should be invalidated, and/or there is no infringement. Best guess is this will be  settled in court within two years.

More importantly, what do all you travel buyers and suppliers have to say about the pros and cons of a supplier who has patents covering elements of its offerings?

Should innovation be rewarded with this form of protection, essentially as a way to create more incentive to risk R&D funds?  Or do the implications of paying higher prices for what amounts to a monopoly on a product turn you off? Vote here and let’s see what you all think.

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Views on Travel Innovation, Part 3: What’s Needed

Good innovation solves worthy problems.  Here are three problems that strike me as worthy, and their very rough calls to action.  (Part 1 in this series covers major travel innovations to date; Part 2 covers key non-technology factors that will affect the future of the travel industry.)

Problem: Tedious Travel Searches. 

Most Popular Reads for Nov. ’09

Here are last month’s most popular posts.  Three of them deal with innovation in the travel industry.  Two deal with travel data, and two have that magic word “free” in the title.  Just when I thought my content was getting good!  This month I’ll focus more on airline sourcing topics.

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Travel 101 – provides a short video introduction to the travel category, and four good articles covering travel data sources, scrubbing, reporting and analytics.

What’s Next In Travel Innovation – covers the trends I saw from the PhoCusWright conference on Travel Innovation last month, and the implications for travel procurement.

Future Innovations in Airline Distribution – gives my views on three major innovations that will impact how airlines distribute their product.

Unexpected Airline Innovations – highlights two interesting tools that show how airlines are thinking more broadly about their mission.

Free Webcast on Travel Data – presents a blue-chip panel’s views on how to use travel data.   You can see and hear the archived presentation until Feb. 15th, 2009.

Free Tools – a collection of tools and educational presentations all related to travel procurement or travel management.

Editor’s Choice: Pre-Trip Approval Done Right – my post summarizes the successful approach taken by Deloitte, but the real value is in Brian Nichol‘s rich comments.  He gives you the key success factors and friendly advice you need if you’re considering this type of travel tool.

Please let me know what topics you’d like to see covered in the future.  Thanks for reading!

Unexpected Airline Innovations

Two airlines are taking a broader view of their mission.  Virgin Atlantic and Emirates have recently helped bring two innovations to the market, and neither has anything to do with moving people from one airport to another.

Virgin Atlantic has sponsored Taxi2 (www.taxi.to), which helps travelers find ride-share partners at their destination airport.  What a great idea – helps travelers save some money, and reduces carbon emissions by using fewer taxis.

Emirates funded the development of iLingual, an iPhone app that

Social Scanning, Fuzzy Shopping and More Travel Innovations

**Update: The four finalists are noted below in bold purple text.**

The Phocuswright Travel Innovation Summit showcased 34 firms yesterday. Each has an interesting new angle on some aspect of the travel business. For me, the firms in the social scanning and fuzzy shopping categories were the most intriguing.  See this post for my take on the implications for travel procurement.

Top 5 Posts – Last 40 Days

Here are the five most popular posts on this blog from the last 40 days:

1. Trippy – Tomorrow’s Biz Trip Planning Tool? (Trippy is a mash-up of Google Wave, Google Maps and Lonely Planet content)
2. Travel 101 (a 4-minute video introduction to the travel category, and four posts covering Travel Data 101)
3. Travel Procurement’s Fighting Words (started by a slam against using procurement principles in the travel category)
4. Future Innovations in Airline Distribution – Condensed (a summary of problems and  innovations needed in the airline distribution channel)
5. Why Travel Disses Procurement (explains the friction found between travel and procurement staffs and what to do about it)

I’m surprised that two of these posts don’t relate directly to travel procurement (“Trippy…” and “Future Innovations…”).  You’re saying it’s OK to cast a wider net in terms of topics.  Cool.  I’ll continue to bring in this type of content from time to time.  What else would you like to see here?

“Future Innovations in Airline Distribution” Condensed

Here are the highlights from my recent presentation at CASMA titled  “Future Innovations in Airline Distribution”.   The original deck has about 50 slides, but because it was designed for a live 60-minute speech, it’s hard to get the meaning of many of the slides (nearly all pictures) by themselves.  So here’s the 3-minute version:

Channels have limits.

Distribution channels are essential to commerce, but they have limits.  The Panama Canal has to build wider locks to accommodate the newest and largest cargo ships.  This is a metaphor for the GDS distribution channel, as it cannot handle the “wider” content that airlines want to distribute today.

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