Business Intelligence: Because Knowledge is Poweradmin.travelbooster.com/Resources/WhitePapers/BI.pdf · Business intelligence systems can help travel agents, operators, wholesalers

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Galor Systems and Software Development Ltd.

Azrieli Center 1, 67021 Tel-Aviv, Israel | Tel. +972-3-6076300 | Fax. +972-3-6076310

Email: [email protected] | Website: www.travelbooster.com

Business Intelligence:

Because Knowledge is Power

Published by Galor Systems & Software Development, April 2009. This publication may be distributed freely in its entirety. Content must not be changed.

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Executive Summery

This white paper briefly outlines the benefits of Business Intelligence tools for the

travel management industry. This paper touches on the many sources and

complexities of information flow in this industry, and reviews the importance of such

data in making key decisions. The paper discusses how the right BI solution can

have a positive impact on the profitability and efficiency of a travel management

business, and is a “must have” to ensure growth. The paper also offers advice on

choosing a BI solution, including finding one that analyzes both internal and external

data, integrates with existing travel management and online booking software, and

allows users to apply BI when making decisions that impact their daily working

process.

What is Business Intelligence?

Businesses of any size must be able to identify, track and react to Key Performance

Indicators (KPIs) that represent how the company is performing, and how customers

are reacting. In the travel industry access to this kind of information is especially

important, with a direct influence on profitability. A healthy flow supports executives in

their efforts to better negotiate contracts, manage commissions, set targets and

identify opportunities to increase sales and reduce costs.

Business intelligence tools (BI), also known as Business Analytics, or Enterprise

Performance Management are applications and technologies that help companies

plan, understand and manage their financial and operational performance by

providing access to data that helps users make better business decisions. BI tools

gather and analyze both internal and external information such as internal

evaluations, customer profiling, customer support, market research, market

segmentation, product profitability, statistical analysis, inventory and distribution

analysis.

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The key benefits gained from deploying a BI solution include:

Minimizing business risk while maximizing business opportunity.

Users gain instant access to the information necessary to make better

business decisions.

Faster reaction times to positive or negative trends mean a significant impact

on your efficiency & profitability.

A better understanding of your customers, and therefore a greater ability to

answer needs, and develop a stronger relationship.

Better visibility of the organization for both executives and business

managers.

Extracts and analyze data from multiple sources.

Employees spend less time trying to locate and access information, making

the business more efficient.

The Challenge: Complex Flow of Information in the Travel Industry

The world of travel management inherently relies of multiple sources of information.

Information is gathered from bookings, ticketing, usage, cancellations and other

stages of a consumers travel experience. This multiplicity means key data may not

be noticed, communicated or taken into consideration leading missed opportunities to

increase profits, while causing confusion, duplications, and redundancies.

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Figure 1 (below, taken from a 2008 report “Best Practices in Travel Business

Intelligence” authored by Norman L. Rose, sponsored by Sabre), demonstrates some

of the categories of information that need to be managed in a standard travel

business.

Figure 1

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The Solution: BI Tools for the Travel Industry

Organizations without BI tools often spend hours or even days preparing monthly,

quarterly and annual reports using Excel spreadsheets or other traditional reporting

tools. This old fashioned approach halts the flow of information and means the

organization is dependent on the IT personnel for creating and gathering the

information in these reports, and the team must still conduct the final analysis.

A good BI solution solves these problems by providing more valuable information

than operational reports or spreadsheets can offer. Besides giving the decision

maker a tool to quickly make a top-down analysis of his data without the dependency

of the organization's IT people, it provides advanced analysis that otherwise would

not be achieved using a more traditional approach.

Some examples of how to apply BI tools to a travel business include:

Understand and analyze industry relevant factors such as sale matrices, commissions, markups and internal operations

Analyze turnover, expenses & profit in various dimensions such as

destination, suppliers, agents, booking clerks and many more

Create sales and profit targets for branches, team members, agents and

suppliers and analyze these targets on a daily basis.

Identify best selling contracts to assist in renegotiation and allocation planning

Identify and reward top agents

Forecast next year's sales

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How is it used?

The type of question being asked often dictates which source of data is most

appropriate. BI reports essentially fall into three broad categories: executive

summary, vendor analysis, and compliance. (See Figure 2 below, taken from a 2008

report “Best Practices in Travel Business Intelligence” authored by Norman L. Rose,

sponsored by Sabre)

Figure 2

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The report conveniently outlines each of these categories as follows:

Executive Summary: This includes summary of total spend by categories,

divisional and departmental breakdowns, geographic comparisons and

month-to-month or year-to-year performance comparisons.

Vendor Analysis: This includes detailed analysis of airline market share,

hotel nights, properties used, car rental statistics and more.

Compliance: This broad category encompasses the entire subject of policy

monitoring and enforcement — for example, lost savings when travelers do

not choose the preferred supplier, fare or rate, as well as identification of

incomplete segments (e.g., itineraries with air but no hotel). Also within this

category is booking behavior, including online adoption and advance

purchase booking patterns.

Studies and experience show that there is a fast learning curve in understanding of

the usability of a BI solution. It is also well documented and known that the wise

usage of a good BI solution saves both a good portion of time and money.

Integrating BI: How to make it work for you

The adoption of BI tools by SMB’s is gaining momentum. In a recent report, Gartner -

leading technology analyst firm, discovered that among 1,400 chief information

officers surveyed, business intelligence was cited as the number one priority for

technology organizations in 2008 – making this the third consecutive year BI has

topped the list. (Gartner Executive Program, February 2008.)

Business intelligence systems can help travel agents, operators, wholesalers and

retailers gain comprehensive knowledge of the factors affecting their business, such

as employee productivity, sale matrices, commissions, markups and internal

operations. However, it is not enough just to install a BI product. Here are a few tips

for effective integration into any travel business:

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Each member of the team must see themselves as a channel for information,

responsible for distribution of business intelligence throughout the enterprise.

Each member must be able to apply BI in order to make decisions that impact

their working process.

Team members assured access to BI include: Finance managers, department

heads, line managers, sales staff, etc.

Integrate all your internal corporate travel software solutions and online booking

software for best effect. This will allow your BI tool to gather and analyze more

information and give better results.

Use your BI tool to ask yourself “what if” questions and “play” with different

reports.

What to Look For

When choosing a BI system, the following elements are critical for seamless

integration and usability.

Choose a system that integrates with your existing infrastructure, so the

analysis corresponds with the logic and the data already built into your

business.

Allows for top-down summarized reports, to help you identify strengths and

weaknesses in your organization.

Represents up-to-date data that is refreshed daily.

Allows for custom-made BI reports, to better fulfill your specific needs.

Summary

The travel market is heading into to an uncertain period in which sales may be

greatly affected by the existent financial crisis. A smart BI solution can and will help a

decision maker to forecast sales, negotiate contracts, manage commissions, create

and monitor sales and profit targets and identify opportunities to increase sales and

reduce costs.

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About Galor

Established in 1989, Galor is a leading supplier of travel technology, boasting a client

base of over 700 customers and innumerable users in more than 25 countries around

the globe.

Galor was founded on the belief that to promote growth in the global travel industry,

sophisticated but simple technology must be accessible to all. Our vision is to

upgrade the industry by introducing cutting edge technological solutions that answer

the evolving needs of the market, reducing costs while expanding business

opportunities.

Based in Israel (the second Silicon Valley), our highly experienced international team

of executives includes over 70 people focused on excellence in development,

product application, customer support, training, installation & implementation,

administration and finance.

About Travel Booster

Travel Booster is a SaaS based end-to-end tour operator software with a complete

suite of front, mid & back office tools, and an integrated BI solution.

The Travel Booster has lots of powerful reporting & BI options such as Turnover,

Expenses & Profit in various dimensions such as destination, suppliers, agents,

booking clerks and many more.

The product acts as a hub for a range of different services that include single

components such as flights, hotels, cars, attractions and tours, as well as dynamic

packages, static packages and shopping cart options.

Members of the Travel Booster community can access the system anywhere and at

any time and effortlessly load and manage their own content as well as integrate with

GDS and third party interfaces.

With an intuitive web based interface, Travel Booster includes all the tools necessary

to handle reservation, operation, administration, and financials, together with a

sophisticated integrated BI solution.

Documents

Business Intelligence: Because Knowledge is Poweradmin.travelbooster.com/Resources/WhitePapers/BI.pdf · Business intelligence systems can help travel agents, operators, wholesalers