‘Automation can cut cost by 55 per cent’
With India becoming the tenth-largest MICE market in the world, companies are grappling with climbing costs for processing travel and expenses. Automation, it seems, is the only way out and can reduce these costs by at least 55%.
With a total spend of US$ 22.1 billion on business travel currently, India’s MICE market is expected to grow by at least 13.5% year-on-year. With this growth comes the increase in processing travel and expenses (T&E) costs of traveling employees for companies.
Moving towards a more automated environment by adopting newer technology is the only solution. This applies to travel companies just as much as it does to corporates.
A lot of big travel companies are realising this and automating their systems
Delays, overshooting costs
A recent study carried out by Phocus-Wright titled ‘CFO Innovation Asia’ found that a delay in getting a travel approval by even five days can push airfare costs by 10%. And that is just flight costs.
Ramesh Iyer, MD (India), at Concur, a US-based company that provides integrated T&E management software, says, “A lot of big travel companies are realising this and automating their systems. This, we have found out, can reduce processing costs of T&E by at least 55%.”
Concur has a suite of products – from just booking tickets to getting approvals for the entire trip. “We also have data analytics and other products that dig into data to provide insights into how companies can lower their business travel costs in areas such as hotel rates and airfares, includ- ing identifying areas that attracts the highest expense,” Iyer adds. Automation now also needs to be combined with mobility, he says, adding, “A large number of business travellers are now getting approvals and claiming expenses on smart phones while on the move. This helps them extract better rates from suppliers.”
Raising the stakes
Through its stake in Cleartrip, which was recently upped from 25% to an unreleased figure, Concur provides Cleartrip- generated travel itineraries and expense reporting within its services. Concur also sources domestic travel content such as rail and airfare, and hotel rates from Cleartrip. Concur had invested US$ 40 million in Cleartrip in April 2011 to tap into India’s online travel market.
“We have eight to ten products that are relevant to the travel industry – such as the self-booking tool and a central reconnaissance model – that is used by big agencies,” Iyer adds. .