12 Oct 2000
There is no doubt about it. Travel agents feel they are under siege by the airlines, their traditional partners, and are looking for a champion to show them the way.
And it could well be Abacus, the leading Asian GDS, they are setting their sights on.
Which is somewhat ironic – Abacus is owned by the very same airlines that agents say are trying to break their rice bowls with commission caps and nett fares.
During one of the workshops at the recent Abacus conference in Hong Kong, attended by more than 800 agents from Asia/Pacific, Ronnie Phuah, managing director of TTM Travel Agency Singapore, stood up and said, “Abacus, you are Moses. Lead us to the Promised Land.”
Somewhat dramatic but his plea underlines the urgency with which agents recognise the need for them to review their business models and change with the times.
THE HOLY TRINITY
They know they have to tackle the Holy Trinity of agency management issues – how to manage costs, how to increase staff productivity and how to train staff to ensure a sound knowledge base in the transition from order taker to travel consultant.
In the area of cost management, just as airlines are reviewing their distributions costs and their Cost Per Unit, travel agents also have to look at managing their costs.
With airline commissions on the slide, travel agents have to look at how to harness technology to reduce staff costs and, at the same time, improve productivity.
Agency bosses recognise this will make or break their businesses in the years ahead and are looking to companies such as Abacus to help them with affordable technological solutions.
HOW GDS CAN HELP
In turn, Abacus is coming up with Web-based products to web-enable its 9,300 industry partners.
Chai Cheng Huan, Abacus vice president for agency marketing, outlined four areas in which Abacus could support agents.
• As a technology enabler to improve productivity
• Provide content aggregation so that travel agents can add value to their clients
• Help agencies keep their customers’ loyalty
• Harness emerging technologies to help agencies take advantage of new online distribution channels to reach more customers.
With products such as Agent Online (AAOL) and Business Travel Solutions, Abacus hopes these products will enable agents to become more cost-efficient and staff to become more productive to serve clients better.
BTS, in particular, is a self-booking corporate travel system which Abacus will be marketing both to corporations and travel management companies.
BTI Scenic Travel of Singapore, for instance, sees opportunities in having BTS inhouse and have a few staff trained in using the system, said managing director Peter Choo.
“If this increases staff productivity and we are able to sell more tickets as a result of it, it is worth the investment,” said Choo.
A QUESTION OF TRAINING
Another area of investment that is crucially needed is staff training. If agents want to be paid a fee for their service, then they have to train staff, an area where there has been resistance in the past.
The old argument that “once you train staff, they leave” can no longer hold water in the new environment where people have more job choices. The truth is, “if you don’t train, they leave anyway.”
Lily Agonoy, operations manager at Qantas/British Airways, who used to work at Farrington American Express, knows about this firsthand. She said,
“Agents do not allocate resources to train staff. They must do that so that staff can become experts in their field and become consultants.”
An area that needs more work on is the training of newcomers to the industry.
Agonoy said the industry had a tradition of turning away inexperienced staff as most agencies felt they could not afford the time or resource to train new recruits.
But Agonoy said the industry needs new, younger blood and “they have to work on newcomers. They must not turn away inexperienced people. They must bring in new graduates and train them.”
Indeed, one of the observations made by an Australian delegate at Abacus was his surprise at the higher average age of travel agency owners and managers in Asia compared to Australia.
“In Australia, we have a new breed of younger agency managers who are coming in and are more willing to change with the times,” he observed.
Christine Toguchi, vice president marketing, Asia/Pacific of Utell International, said that if agents want to elevate their experience and service and charge fees for their advice, “then they have to make the time to have their staff trained”.
Toguchi said the reason most often cited by agency bosses for not sending staff to supplier training programmes was “no time”.
“But everyone is busy. They have to make a conscious effort to have staff trained if they want to justify the fees they will be charging. Their staff must be able to give professional advice that customers will pay for.”
On Abacus’ part, the GDS knows it has to help agents make the transition because agents are their customers. Said Chai, “The jury is still out on whether the number of travel agents will shrink or mushroom.
Disintermediation could force agents to become more efficient, like the Y2K issue. It forces everybody to lower costs and increase productivity. We want to help agents get through but, at the end of the day, you have to help yourself as well.”