The Future for Travel Management Companies

Managed Travel 2.0 has a huge implication for travel management companies (TMCs).

Namely, the business model for TMCs is going to change.Here’s how I see it:

Fifth in a series on Managed Travel 2.0

First, let’s start with the core issue – the booking transaction.  It’s the center of the TMC’s universe.  They organize and price their business around this function.  Everything else is basically an ancillary service. It’s all about the transaction fee.

No surprise that clients view the transaction fee as a bull does a red cape.  It’s highly visible, a tempting target, and instinctively from a procurement perspective, it’s something to attack.

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The Curious Case Against Managing Travel

Achieve better trips. Increase traveler satisfaction. Spend less on travel.

That’s the trifecta of travel management, isn’t it? So which horse would you bet on to deliver these wins – the one with, or without, a jockey?  The managed travel program, or the unmanaged travel program?

GBTA’s “Global Business Traveler Study 2012”, a 72-page report, shows the winner is the unmanaged program – and it’s not even a close race.  That’s the conclusion I draw from the study’s facts as they pertain to U.S. travelers. Continue reading