Like me, many make New Year resolutions. Especially, the one where many plan to lose weight. Imagine if you took on this challenge. What would you need to accomplish your goal? A sensible nutrition and exercise plan, certainly. Surely the mandatory requirement is also scales to measure your progress? What if you didn't own scales? How would you record your weight at inception and the progress you are making? How would you know when you've met your goal? Without the tangible record of the effectiveness of your weight loss programme, you might get discouraged, demotivated and fail to meet the resolution. More importantly, you may not know if your current exercise and nutrition plan is not working and therefore cannot change course to something more effective.
Yet many travel managers set goals based on realising savings without the full visibility of their spend.
Defining visibility
Some travel managers would argue that we define the proportion of 'visibility' in terms of how much of the total cost we are able to see. That is, to get our percentage of visibility we would take the sum of expenditure from all sources and divide that number by the cost of travel outlined in the General Ledger (G/L).
A significant discrepancy creates a situation where achieved savings aren't fully reflected in the G/L. As the G/L is the firm's record of the true financial situation, you may think that you've made savings but if this doesn't drop to the G/L, the savings are not "cashable".
While this is a good way of understanding if the spend you are covering in your travel programme is complete enough to equal the spend recorded by finance, it still may not achieve 100% as it covers the depth of visibility but not necessarily the width.
What is "deep" and "wide" visibility and why do we need it?
The depth of visibility is a sort of deep-dive into financial data examining the money leaving the bank account. It looks at the money only, leaving all circumstantial data around the transaction (date, time etc) out of the picture.
When we talk about "deep" data, the industry often talks about how the TMC is not enough as it only shows around half of all spend activity. In fact, we analysed $8.5 billion of travel-related spend to discover the TMC misses around 41% of it. Credit card data and expense data was a lot better at covering the actual money leaving the bank account.
Let's say all TMC activity were to go through your expense system, removing the TMC dataset entirely. This will not affect the depth of data coverage. If your expense system covers 90% of your G/L spend, you would still have 90% visibility, yet I'm sure no travel manager would believe the removal of the TMC data merely removes 10% of their coverage.
TMC data is so valuable, not because its coverage is deep but because its coverage is wide. Its true value lies in the parameters around the spend guiding buyers to take action. Flight numbers, dates and times are important when dealing with duty of care and risk - therefore a pure cost analysis is often not good enough.
What aspects would require focus on the width rather than the depth of visibility? This could be anything that looks at the human cost of travel and the associated indirect expenses this incurs. As we know, when travellers do not feel comfortable when travelling, their performance is often the first casualty. Further enforced travelling will likely lead to them leaving the company sooner than they would under a more elegantly-managed programme. A travel programme focused exclusively on managing, minimising and controlling spend, that is, the elements that require deep but not wide visibility, may fall into this trap.
Total visibility is therefore an area, not a measure on a line, which is a subtle but important distinction, and one any travel manager trying to calculate their level of visibility should be aware of.
If I tie this back to measuring weight loss performance on a scale, I am sure many health and fitness professionals would believe that weight is not the only measure of health. They need to correlate the weight with the height to get an appropriate BMI while also taking into account other factors such as the percentage of body fat vs muscle, for example. Both the height and weight have to be integrated, matched and correlated together, merely to get a basic BMI.
While this is simple in weight loss, we know this is not nearly as simple in travel.
100% visibility first needs 100% integration
A pain point I often hear from travel managers is that while they understand the need for deep and wide data from multiple sources, they struggle to match and fuse fragmented data sources together into a single source of truth.
Knowing from experience how much a single data source can add a high range of possible analyses, I believe a truly rounded data-driven programme should aim for a number as close to 100% as possible and, more importantly, take steps to ensure that this data remains on-hand and in use. Having 100% data visibility is useless if travel managers have to go to more than three sources and deduplicate or guesstimate between them to get the data they need. After all, integrating these different sources takes weeks and data delivered weeks after travel does not drive action.
If I was on a health and fitness plan, I am certain I would like to know what my progress is at this moment as opposed to how it was six weeks ago.
How do buyers integrate without the drama? Travel managers need to strategically pick the sources they want - ensuring they can integrate each of these sources successfully into a single source of truth. The principles guiding this data selection can be 100% data visibility against the G/L, however I'd encourage travel managers to also assess the strategic breadth they wish to achieve in their programme.
Often programme goals like policy compliance and improved sourcing drives the data points travel managers wish to consider. If you require a total view of spend for policy compliance and spend management, than TMC, card and expense data is the bare minimum you need. If you want better negotiations with suppliers - improved visibility into supplier contracts and traveller use of ancillaries are desirable data points. If you want to become a fully-integrated driving force behind your business, we need to go even further - diving into the human cost of travel and the ROI of their trips.
Once these sources are defined, ingested, matched and analysed, they can become a single source of truth. The key is to start with realistic goals at first and then consider adding additional data sources and climbing upwards to reach 100% coverage.
This is a journey which both suppliers and buyers can get behind and work together on. The industry is coming to a realisation that no single monolithic business dataset provides us with everything we need for full visibility and optimisation. Perhaps 100% visibility in a single source of truth can be our industry's new years resolution. Let us get our scale.