Business Travel News

Mega TMCs Have Mega Expectations For Client Service

By Jack O'Neill, Chief Operating Officer, Carlson Wagonlit Travel
My friend John Caldwell is one of our industry's leading consultants. However, with all due respect to John, I would be remiss in not offering a different perspective to his, expressed in the Oct. 9 op-ed, “Mega TMCs Wrongly Reconsidering Account-Management Model.”

Our differences with several points made in the op-ed can be summarized by recognizing that the practice of travel management is continually evolving. The travel management function has changed both in complexity and program sophistication, as have clients' expectations. Therefore, it is understandable that the definition and role of account management have also changed in response to the continually evolving market and clients' needs.

Mega TMCs Wrongly Reconsidering Account-Management Model

By John Caldwell, President, Caldwell & Associates

Faced with pressures on margins from online competition and marketplace commoditization, travel management companies are restructuring and more narrowly defining their service model for core or basic services. One victim of this is account management. Account managers have always been consultants, serving as a single point of contact while providing proactive market intelligence, benchmarking, opportunity analysis and strategic assistance with suppliers. These professionals also managed global and local programs pursuant to business plans and service agreements collaboratively worked out with travel managers.

The new model reduces account management nearly to a ministerial level. Clients are being induced to move to newly invigorated consulting divisions, which are higher-cost and offer richer yields especially where "gain share" or contingency savings payment arrangements are promoted. This shift in focus and resources is supplier-enabled by a more concentrated industry—corporates have fewer choices, especially in global programs. Consulting services in some cases are being tied to attractive core pricing.