Tuesday, December 28, 2010

Data Provision - Sounds easy?

There was an interesting blog recently called "Stairsteps to Heaven" written by Scot Gillespie and I identified with it very closely. He eloquently expressed the frustration of us all as to why it seems so difficult to get even the most basic data in an accurate, efficient and user-friendly way.

I agree with Scot that surely the travel industry should be able to provide decent data and goodness knows there is a huge amount of the stuff floating about. In fact a day rarely passes when some new data mining tool or MI gizmo does not get an airing. The tools are not the problem and probably never were. The issue is the quality and clarity of the initial information that goes into them and the ability of those who manage what comes out of other end. Yes I agree that the travel industry is large but I am afraid it has not matured very well as it still uses out dated, diverse and badly coordinated systems at the supplier end

Take for example a company that sends it’s travellers across the length and breadth of their own country and all over the world. Their travellers sit on planes, travel by car and rail, stay in hotels and need to comply with a travel policy built around the optimum use of resources at the best prices. But what is the right policy for them? How can it be best optimised? How can you be truly sure it is being complied with? Obviously this company needs both the data to make informed decisions and someone to interpret the data in order to provide quality analysis and recommendations.

The first port of call has to be the origin of the data and how it can be placed in the right format into the right data warehouse. This is where the issues start. Why? Because each supplier uses systems different to each other that were created many years ago and not built for export into other systems. They also interpret their own data differently with respect to prorating sector costs of tickets that contain more than one airline, commission rates and, more latterly, ancillary charges. Many tickets do not have the true price (or in fact any price) on them due to corporate deals etc.

The hotel industry is far worse and they have to split out more cost to get down to basic bed price. There are literally millions of hotel and precious little fiscal commonality. Even the big chain hotels can be misleading as they are not all owned (and therefore consolidated) by that brand company. You will also rarely find them consolidated in any GDS as GDSs charge too much.

Rail too is a law unto itself with vast numbers of different train companies and tariffs for the same journey as well as more sectors and low prices than all the others put together. Car hire and ferries ditto.

OK, so you may have to accept that it is virtually impossible to have totally clean data in the same format from the same source but there should still be value in trying to get travel consolidated. For instance you have the GDS and all the other companies created for this purpose. Trouble is many global organisations use different GDS in different countries which still need to be brought together. Another key airline only source (and possible solution) is IATA and ARC who are the companies that do all the pulling together and reconciliation for the air suppliers across the globe. This possibly has the best data in the sense that it is standardised. The algorithms they use and the assumptions they make are quite scary but at least like for like.

I am really quite surprised that more effort has not been made to explore this source from a corporate perspective. Maybe it is because IATA was formed by the airlines for the airlines and I am not sure of their overall willingness to open up such transparency. You see this data is being sold and used within the airline community already A bit worrying really but airlines can buy from IATA enough to identify what deals a corporation has with a competitor right down to traveller numbers and price paid.

I think the solution such as it is lies with the TMC. They are the only intermediary within the chain that does enough to bring together all the elements. The big ones are already well advanced in devising systems and frameworks and have the capability of working with all players…at a price.

So, if the happy day comes where you have enough data to work with reasonably accurately. What next? Well I think even now corporations have spent far too much on getting the data and far too little on interpretation and use of it. In the modern day I think it far more important to get a TMC to provide a data consolidator/analyst/strategist than a standard Account Manager.

So my brief conclusion? You cannot get truly great data because, whilst the systems are there, the initial information is not available in a manageable format. You can however pick up the best bits (mainly air) and compare like with like. But before that make sure you have a professional who is fascinated by data and able to read it and make recommendations.

Finally I think organisations such as NBTA, ACTE, IATA and the like should spend less time on conferences, self justification and money making and more on working together to create a global multi-disciplined solution

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