Today’s advisor is travel management veteran Andy Menkes of Partnership Travel Consulting. He writes that while data from travel management companies has improved over the years, travel program managers must do their due diligence. That means plugging gaps and checking everything.

President Ronald Reagan made the phrase “trust, but verify” famous in the United States back in the mid-1980s when he was negotiating a nuclear arms treaty with Soviet leader Mikhail Gorbachev. The risks of relying on travel data are much less severe than a nuclear missile, but the fallout from using flawed data could impact your job security.

For decades, corporations and their travel managers have relied on TMC data as a source of financial information that can be shared internally with a high degree of confidence. The reality is that the data, which is really GDS-sourced data, has its pros and cons.

On the plus side, TMC data is a valuable tool for pre-trip cost avoidance by capturing non-compliant bookings and changing behavior before the expense is incurred. Examples include preventing bookings with non-preferred suppliers or airfares higher than the “lowest logical.”

Buyers also can use TMC data to improve the hotel “attachment” rate, which is still around 50 percent in the managed travel space.

But there are downsides.

You can comfortably rely on the accuracy of TMC data as it applies to airfares in that the ticket number, routing, amount paid, etc., map exactly to what the airline receives — unless the traveler makes a change to that PNR directly with the carrier. Ancillary revenue for the airlines exceeded $80 billion in 2017, yet TMC data cannot capture information on much more than a value-add preferred seat reserved at the time of booking (depending on the airline). Traveler purchases of priority boarding, priority seating, on-board meals, airline lounge passes or memberships and hotel upgrades upon check-in all produce spending data that is not readily available.

Partnership Travel Consulting founder Andy Menkes

The real challenges with TMC data relate to hotel and car rental spend. The TMC data (from the GDS) will show the hotel room rate and number of nights, but the total cost of that room will be much higher than reported due to local taxes and fees. Any additional charges to the room further widen the gap in data credibility.

Meanwhile, anyone who has ever rented a car knows that the $59 daily rate ends up being closer to $89 by the time you add local fees, taxes and surcharges.

It would be worthwhile to spend time with your TMC account manager to better understand how data flows from the passenger name record to the agency back office and ultimately into a reporting tool. One area of concern is changes to a PNR. If you add or change a hotel segment after the airline ticket has been issued, that updated hotel information will not be recorded in the TMC’s reports — unless the agent “forces” the PNR into the TMC back office.

Currency used and conversion rates also can further erode data quality. I highly recommend a review of global data based on those. Unfortunately, there is no single source from which to get complete data. Generally speaking, suppliers have the best data because their numbers are consumed spend, not booked spend. Suppliers have access to Prism data, GDS data (including Marketing Information Data Transfer, or MIDT) and data from other third parties.

The best sources of spend data for a travel manager are the corporate card and internal expense management system.

The key to managing all this disparate data is to identify a qualified third party data aggregator that can cleanse the data, normalize it and provide the analytics to find the gaps between booked and consumed data.

TMCs have vastly improved the quality of their data over the years, and generally speaking, you can trust it. But it’s critical that you also verify the data. Before you send out to company leaders those monthly executive travel dashboards, take the time to validate the data that you are collecting. Engage a qualified entity (which could be your TMC or an outside supplier) to audit, improve and validate the quality of the data so that you can turn it into meaningful business intelligence.

Once you have validated your data quality, ensure that you don’t fall into the trap of reporting numbers that are misleading or irrelevant. Two examples are average ticket price and average hotel rates. Unless you are comparing an identical city pair in the same cabin class, either over time or versus peer organizations, the average ticket price as a summary number for your company is meaningless. The same holds true for an average hotel rate; it will vary by city and by seasonality.

Find out what metrics your internal audience wants to see and report those numbers directly. That means comparing spend to budget, and examining compliance levels within the organization. Once you have aligned with your internal stakeholders, you can provide them with strategies to optimize their travel spend.

Don’t simply generate monthly travel spend reports that don’t tie to the general ledger — and are probably not even being reviewed, let alone appreciated.

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