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Online Business Travel Management:
Present Practice - Future Promise
Alexandros Paraskevas a , and
Céline Baron a
a
Department of Hospitality, Tourism and Leisure Management
Business School
Oxford Brookes University, United Kingdom
aparaskevas@brookes.ac.uk
baronceline@hotmail.com
Abstract
Business travel has become the second largest corporate cost and increasingly corporate travel
managers are being pushed to control and reduce it. The use of online Business Travel
Management solutions appears to be an effective way towards this end. The present study aims
at presenting the benefits that these solutions offer to corporate travel managers and their
limitations as presented by both business travel agents and software providers and identify
which of these are really important to corporate travel managers. Further, it attempts to explore
the factors that determine the propensity of corporate travel managers to use such online tools.
Keywords: Business travel; online tools; benefits; limitations; propensity of usage.
1 Introduction
The World Travel and Tourism Council estimates that the global business travel
expenditure in 2003 will reach US$ 489 billion (WTTC, 2003:16). Despite the
adverse events (such as terrorist attacks, wars and economic recession in many parts
of the world) business people continue to travel, only now companies are looking for
ways to rationalise business travel expense, which -for many companies- has become
the second largest business cost (Noakes, 2002; Mason, 2002). Companies are
increasingly looking for ways to better control these costs and are developing specific
processes and policies towards that end. The position of corporate travel managers has
emerged either as one dedicated to this account or as part of the wider corporate
procurement function (Anderson et al., 1999). Most of the companies with high travel
expenditure are using business travel management (BTM) services offered by
specialised travel agencies. As this is a lucrative market, it attracts a large number of
organisations, which try to secure a fair share of it. Only the Guild of European
Business Travel Agents (GEBTA), for example, includes over 300 business travel
agents in 11 European countries with a total turnover of over €13 billion. The
increased rivalry and the entry of online business travel agencies will lead to a
consolidation either through mergers and acquisitions or through the form of consortia

such as the one already formed between Worldchoice, the Travel Trust Association
and Midconsort, which includes more 1500 independent travel agents.
Changes in the principals’ (airlines, hotels, car rental companies) policies mainly in
the reduction if not elimination of commissions (Bray & Cohen, 2002) and their
attempt for dis-intermediation through proprietary websites (Cline, 2001; Marcussen,
1999; Middleton & Clarke, 2001) resulted in many BTM agencies to review their
pricing structure and charge their customers fees for their services working now on
behalf of them as negotiators for best possible deals rather than being a distributor of
the principal (Mason, 2002). Also instead of concentrating only on big corporate
clients -business travel market follows an acute form of the 80/20 rule with more than
80% of international business travel bookings made by less than 20% of corporate
clients (Mintel 2000)- BTM agencies are increasingly getting interested in the SME
market segment and launch dedicated services such as the CorporateChoice by
Worldchoice.
Increasingly, these travel agencies are using -in various degrees- information and
communication technology (ICT) and the Internet to streamline their business process
(Bray, 2002). A further development in this area is the emergence of corporate webenabled
self-booking systems by-passing the traditional BTM agencies (Del Rosso,
2001). The benefits of the ‘e-transformation’ of corporate purchasing have been
widely discussed in the generic literature (see, for example, Attaran & Attaran, 2002;
Cooper-Jones & Macklin, 2002; Ovans, 2000) but have received little attention in the
business travel literature. The first step in understanding how the Internet has
impacted this area would be to investigate how corporate travel managers employ the
Internet in purchasing. Towards this end, the present study addresses three research
questions:
RQ1: What are the perceived benefits offered by the online BTM service provision
and under which conditions can these be achieved
RQ2: What are the benefits that corporate travel managers in an online BTM service
provision and what are the areas would they like to see improved (RQ2a)
What organisational, personal and environmental variables influence corporate
travel managers’ propensity to use online BTM services (RQ2b)
2 Business Travel Market and the Internet
Technological developments such as the proliferation of the Internet and of e-
commerce have also had an impact on BTM. Price transparency has increased the
bargaining power of customers and new online intermediaries such as Expedia
Corporate Travel have entered in this market and many BTM agencies have
developed a “clicks-and-mortar” presence (Palmer & McCole, 1999; Buhalis, 2003).
A challenge for BTM agencies is the emergence of business travel e-procurement
solutions such as GetThere in the US or KDS and I:fao in Europe that have been

developed by independent software companies. Similarly, GDS companies have
developed their own booking solutions, such as Highwire (Galileo), Corporate.Res
(Sabre) and Trip Manager (Worldspan). These web-based BTM systems enable
companies to take advantage of special business fares and at the same time, they
provide controls to track savings and prevent abuses (Bray, 2002).
The benefits offered by the automation and the web-enablement of business processes
has been widely discussed in both generic and tourism literature (see for example,
Dutta & Segev, 1999; Brewton & Kingseed, 2001; Werthner, H. & Klein, S. 1999;
Cline, 2001). The e-transformation of BTM service provision however, offers a series
of business travel-specific benefits to corporate clients that have not been recorded by
the extant literature. On the other hand, these benefits may be achieved only under
certain conditions. RQ1 by adopting a descriptive approach, aim at exploring these
benefits and the possible limitations of the online BTM. This will be achieved by
recording the views of key BTM suppliers. Then, RQ2a will explore the importance
corporate travel managers attach to these benefits or limitations of the online service
provision.
Several models have been developed in order to explain IT innovation adoption. In
the case of online BTM the authors have chosen the model proposed by Gallivan
(2001). The model suggests that there are three main categories of factors that can
influence the adoption of an IT innovation at user level (i.e., corporate travel
manager’s level): a) managerial interventions, which include the actions taken and
resources made available by managers to expedite end user adoption including
mandating usage (Leonard-Barton & Deschamps, 1988; Agarwal, 2000), b) subjective
norms describing individuals' beliefs about the expectations of relevant others
regarding their own secondary adoption behaviour (Saga & Zmud, 1994), and c)
facilitating conditions that include other factors that can make the adoption more
likely (Orlikowski, 1993).
3 Methodology
The researchers needed to first clearly define the term “business travel” in the context
of the study, as there is not a universally agreed definition (De Sèze, 2002). The
definition of “business travel” proposed by Davidson and Cope (2003:3) was adopted
in this research, excluding this way all travel made for conferences and meetings,
exhibitions, incentives and corporate hospitality, which the authors define as
“business tourism”.
In the first phase of the study, the researchers conducted semi-structured interviews
with nine major players in the supply side (classified as traditional ‘bricks-andmortar’,
‘clicks-and-mortar’ and ‘pure-play’ online travel agents as well as travel
procurement software developers) in order to map the benefits and limitations of

online BTM provision as well as in order to get some industry insight for future trends
and developments in this market. A purposive sampling method, which allowed the
researchers to use their judgement for the selection of people that would best enable
them to answer RQ1, due their specialist knowledge in the matter (Saunders, Lewis
and Thornhill, 2000). Twenty BTM companies, providing solutions either online,
offline or both were initially contacted. Their contact details were found either in the
of the Guild of Business Travel Agents website (http://www.gebta.com) or directly on
their company’s website (identified through normal Internet search). Seven of them
agreed to participate, giving a response rate of 35% not compromising the
representativeness of the various types of providers in terms of sizes and services
offered.
In the second phase, 250 questionnaires were e-mailed to corporate travel managers /
travel procurement officers in UK, France, Greece, Cyprus, Malta, Italy and Spain in
order to address RQ2. This was a purely convenience sample “simply available to the
researcher by virtue of its accessibility” (Bryman, 2001:97). The contact details were
found in the Internet, the business travel trade press and in the customers’ list of a
B2B electronic marketplace based in Greece but serving the whole Mediterranean.
Sixty-seven questionnaires were responded, of which, only fifty-six were usable
(effective response rate 22.4%).
4 Results
4.1 Interviews with Online Suppliers
The interviews with the BTM suppliers were recorded and transcribed verbatim. Each
researcher analysed the transcribed interviews separately and the identified benefits
and limitations of online BTM were listed for each interview. The findings were
reviewed to avoid repetitions and then themes that were emerging have been
identified and coded. The results of these individual analyses were then compared
giving a Cohen’s Kappa intercoder reliability (Hughes and Garrett, 1990) of 88.2%.
In terms of data management benefits all the respondents have the view that the main
benefit of online BTM is the centralisation of data, which ensures consistency of the
process, allows objective internal analysis and evaluation and avoids redundancies of
data storage in the, perhaps, several units of the corporate client. Travel information
and offers can be obtained from several sources since these tools are highly flexible.
In the words of one respondent: “The tool can work with different agencies. For
instance, it enables a company that works with Carlson Wagonlit in three countries to
work with Amex in others”. Cross-supplier flexibility is also achieved since “[The
online BTM solutions work]… with any GDS, even for GDSs companies which have
developed their own online booking tool”, such as Highwire developed by Galileo,
“they still have to collaborate with the three other GDSs”.

Continuous connectivity (24/7/365) between service providers, travel managers,
accounting units and travellers improves speed of communication, accuracy of data
transfers and flexibility. Proper workflow management will additional offer cost
savings, while additional communication expenses with travellers are minimised since
a number of functions (such as administration of mile account) can now be managed
online. BTM software providers that corporate clients can cut the travel agent fee by
booking directly on the GDS or even minimise GDS costs by direct interface linking
to principals (e.g. low cost carriers, rail, hotels, etc.).
Travel policy conformity is ensured through automatic check of corporate travel
guidelines and restrictions, identification of exceptions and standardised authorisation
procedures with traveller personal profiles and pre-trip reports. Policies can easily be
reviewed and re-implemented.
Streamlined booking process is another benefit. Only guaranteed ‘best buy’ options
that conform to the travel policy (e.g., approved suppliers only) are offered,
authorisation and billing arrangements are processed automatically, allowing the
persons involved to concentrate on core business activities rather than bureaucratic
procedures. Only “exceptions” need to be approved and processed through an explicit
authorisation process. In essence, the web-enabled BTM tool is at the same time
information and a sales point.
Improved cost control through ‘real-time’ reporting can be achieved as the webbased
BTM tools offer a series of pre-, during and after-trip reports. These reports
allow the transparency of planned and actual travel costs, as well as the evaluation of
suppliers’ (travel agents and principals) performance, which in turn gives the
corporate client to re-organise and optimise the whole travel procurement and supply
chain management process.
As a result of all the above the billing procedure is simplified and in combination
with the potential introduction of company credit cards for travel expenses, the
necessity of travel-related advances frees up a significant capital for the company,
improving this way its cash flow.
On the negative side, the technology dependence of these tools is their vulnerability.
Concerns about the existing Internet infrastructure in the areas of network capacity,
connection stability and reliability, telecom standards, speed of data transmission and
security have been expressed. This technology dependence can also be an adverse
factor in the diffusion of online bookings in a company since a number of travellers
may be less computer literate.
Another limitation is the inability of online BTM tools to deal with complex
bookings. The current technology can support only standard ‘point-to-point’ trips and
therefore if corporate clients have more complex itineraries, they have to direct them
to a BTM travel agency. This means that the corporate client has to classify travel into
two categories: standard trips booked through the online solution and non-standard
trips booked via the agent. As a result of this inability, the travel expense transparency
may be compromised since it is guaranteed only when all the bookings use the online
booking tool.

The level of investment needed for online BTM solutions can also be another
constraint. The software suppliers argued that only corporate clients with travel
budgets in the area of €3.5 million could actually afford proprietary BTM tools.
However, the business travel agents disagree and suggest that they offer online
services to corporate clients with far smaller budgets.
The decentralisation of the booking process and the transfer of certain process steps
to the corporate traveller pose also a few problems. First, it is argued that the time
consumed by better earning employees to book online the trips themselves may
invoke higher process costs than with a conventional telephone or e-mail booking
request to the corporate travel manager. Second, corporate clients need to mandate the
usage of the online booking tool in order to achieve the benefits mentioned above and
this is not always easy as corporate travellers are used to the traditional way of
booking and still find it easier to talk to a human being, who will deal with the trip
arrangements. One respondent argued: “This human contact and the trust can be
created in the agent-traveller relationship can never be replaced by a software. Look
at Expedia Corporate Travel: they offer human contact as well”.
Finally, the time and the cost of deployment (and change management) are a further
constraint. The deployment of such a solution requires a lot of preparation (clear
travel policies, standard booking procedures, information workflow mapping, job redesign
and culture change). In the words of one respondent: “[…the solution
deployment] varies tremendously and we do it on a client-by-client basis. It used to be
very expensive, in fact, expensive enough to put people off. It is only recently,
particularly since the last 12 months, that clients accept the cost more easily”.
4.2 Business Travel Managers
The research on the demand side revealed that all corporate travel managers in the
sample use the services of a BTM agency. Sixteen of the respondents (28.57%) are
using a specific online tool (BTM agency portal or proprietary solution) while 42.87%
of them are using the Internet in general for information on travel options. In the
questionnaire -among some other open-ended questions- the respondents were asked
to indicate, using a 7-point Likert scale, the importance their organisation attached to
these benefits and limitations (RQ2a). Cronbach’s alpha for this scale was 0.57. In
order to find out the underlying factor structure associated with these benefits and
limitations, each item’s score was factor analysed, using principal component
extraction with varimax rotation. The analysis produced eight significant factors,
explaining 81.2% of the variance (Table 2).
It appears from this analysis that their main motive for using online BTM is the cost
reduction potential of such a solution. They feel that they have significant savings in
terms of time, process and negotiation potential but also get the best available prices
for the product they are looking for. The second most important factor of online BTM
provision is travel policy conformity. Here, however, there is a contradiction as in the
open-ended questions section 34 of the respondents (60.70%) admitted that they are
still using a manual authorisation process. One reason for that may be the fact that a

high percentage of their travel bookings are “non-standard” trips (73.21% of the
respondents stated that “non-standard” trips account for more than 30% of their
bookings, while all the rest stated that they account for more than 20% of their
bookings). The inability of the online service provision to deal with complex
Table 1. Factor Analysis: Importance of Online BTM Features
Factors Eigen value COM. C.F.
IMPORTANCE OF ONLINE BTM FEATURES
Alpha = 0.57
Proportion of Variance accounted for = 81.2%
F1 Travel Cost Management 3.7
V14 Guaranteed 'best buy' options 0.87 0.81
V12 Cost optimisation in travel partnerships 0.78 0.68
V6 Savings from process streamlining 0.77 0.65
V8 Pre-trip cost transparency 0.55 0.47
F2 Travel Policy Conformity 2.6
V1 Automatic check of guidelines/restrictions 0.75 0.70
V7 Identification of "exceptions" 0.67 0.76
F3 Data Centralisation 2.3
V4 Process consistency throughout the organisation 0.81 0.82
V18 Reduced paperwork and data storage needs 0.84 0.78
F4 Inability to Deal with Complex Bookings 1.9
V16 Majority of trips are point-to-point* 0.81 0.84
V17 Majority of trips are with one only transport* 0.74 0.64
F5 Real time reporting 1.7
V10 Comparability of planned vs. actual costs 0.88 0.89
V15 Travel partners performance 0.82 0.69
F6 Level of investment needed 1.4
V2 Deployment costs 0.87 0.91
V3 Change management costs 0.80 0.56
V5 Training costs 0.70 0.50
F7 Technology dependence 1.2
V19 Reliable internet infrastructure* 0.84 0.85
V20 Secure transmission of data* 0.86 -0.44
F8 Simplified billing procedure 1
V11 Simplified billing procedure 0.86 0.92
Note: * item was reverse coded
itineraries is identified as its greatest limitation. Two surprising findings were that real
time reporting and the simplification of billing procedure were not deemed as
important as the researchers thought. Quite significant importance was also attached

to deployment and change management costs as well as to the lack of appropriate
Internet infrastructure and security. Very low (not significant enough) importance was
attached to the 24/7/365 connectivity with the BTM service provider, which was also
surprising.
Other questions in the questionnaire revealed that 73.21% of the respondents have an
internal travel expense reporting system, while 17.86% rely on their BTM service
provider/tool and 8.93% admitted that they do not have a special travel related
reporting system. In terms of reports used, the traditional “accounting” reports
(volume booked per supplier, credit card reconciliation, travel activity per
department/traveller) were mentioned the most.
The users of online or automated report systems found the cost savings/ loss analysis
reports the most useful, followed by the pre-trip reports. Further, a 65% of the nonusers
would move to an online tool if the costs were not prohibitive while 12.5% are
planning to move to such as solution within the next two years. As far as the
improvements they would like to see in the online provision, the top requests were the
ability to book “non-standard” trips, the ability to make changes online without
having to call the BTM agent and the ability to talk immediately to someone online
when facing problems or have queries.
In order to address RQ2b, the authors have developed a series of statements with
which the respondents were asked to show the degree of their agreement using again a
7-point Likert scale. To this end they used the Gallivan (2001) model, slightly
modified with the addition of certain variables related with online BTM usage, such
as “pressure to reduce travel expense” in the managerial interventions construct and
“market turbulence” (Jaworski & Kohli, 1993) in the facilitating conditions, to
capture the influence of factors such as 9/11 and SARS on business travel. The results
of the regression analysis are summarised in Table 2.
The results suggest that the factors proposed by the adapted Gallivan model are only
partially supported. With respect to managerial interventions, the analysis indicates
that the pressure to reduce overall travel expenditure is a very strong influencer as
well as the management commitment to mandatory usage of an online BTM tool by
all corporate travellers. Significant as well is the training the travel managers receive
and the support (in terms of other resources) offered by senior management to them.
Regarding subjective norms, an important factor that would affect the corporate travel
managers’ propensity to use online tool is the usage of the tool by other travel
managers in their industry sector. Very little influence appears to have the corporate
travellers as well as the software providers and the business travel agencies on their
decision to adopt the online BTM solution.
Quite interesting is the finding that market conditions (such as 9/11 and SARS) have
no influence on the propensity to use an online solution, contrary to anecdotal
evidence that suggests the opposite. Also personal characteristics such as gender, age,

travel market expertise, or perceived Internet skill appear to have little impact on their
propensity to adopt an online solution. On the other hand, the benefits of an online
BTM tool are, as expected, an important factor for its adoption.
Table 2. Factors Influencing Corporate Travel Managers’ Propensity for Online BTM
Construct Factors Stand t p≤
Beta
Managerial Interventions Mandatory usage 0.16 2.57 0.01
Training and Support 0.15 2.12 0.02
Pressure to reduce travel costs 0.42 6.51 0.00
Subjective Norms Influence by other travel managers 0.15 2.58 0.01
Influence by travelers 0.04 0.62 0.54
Influence by BTM suppliers -0.01 -0.22 0.83
Facilitating conditions Market turbulence -0.11 -1.85 0.07
Online BTM attributes 0.12 2.02 0.04
Travel Manager attributes 0.09 1.45 0.15
Global Test of Model Fit: F=14.06, p=0.000, Adjusted R² =0.37
5 Conclusion
The study indicates a positive trend towards online travel procurement solutions
mainly for the large corporate clients and those with a large percentage of standard
'point-to-point' trips. The main influences in this trend are the increased pressure to
travel expense reduction and the escalating adoption of online solutions (either BTM
agents portals, wider Internet searches, or dedicated software). However, the study
shows that there is a great need for Senior Management commitment and support
towards the usage of such solutions. It is also evident that quite a few companies need
to become more entrepreneurial in the way they handle business travel as -at the timethey
manage it simply as an operational cost and not as a negotiating tool. The main
inhibitors in the diffusion of online BTM are the lack of reliable network
infrastructure and the ongoing distrust of users in the transfer of crucial organisational
data through the Internet. Cost and ROI is another source of resistance for the use of
such solutions but the study shows that their adopters realise considerable savings in
the travel booking and authorisation process as well as reduction in the actual travel
costs.
There are obviously several limitations in the findings of this study mainly due to
convenience sampling and perhaps methodological errors despite the efforts made to
ensure face validity in the corporate travel management context. Although
generalisability of these findings may not be feasible, the study attempts a first
exploration in an area that looks very promising equally for business consultants and
researchers.

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