The Hindu Business Line : A tribe that faces extinction?

An increasing number of air-travellers buy their tickets online. "In the US an estimated 65 per cent of airline domestic sales are done online. In Europe, the number is currently 30 per cent but there is no doubt that the numbers will grow. Asia and India are not far behind," writes Vipul Jain, CEO & Managing Director, Kale Consultants Ltd.

It may, therefore, seem that the online trend may lead to the gradual extinction of the tribe of travel agents. "Yes, the days of earning a large commission for just providing a commoditised booking service are going and will soon be gone," concedes Jain.

Yet, there is some hope. Because "the travel agency provides much more than a booking service - they provide travel advice, visa facilitation, packaging, consolidation and so on," assures Jain.

Well, he should know, because Kale, headquartered in India, is a global organisation with over 700 professionals.

For the travel and transportation industry, a segment in which Kale boasts of "over 60 customers in more than 30 countries", the firm's offerings include solutions for "passenger and cargo revenue accounting, ticket proration, air cargo management, cargo ground handling, and e-travel technologies".

Jain's paper titled, The future of the Airline-Travel Agent Relationship does some crystal-gazing to suggest that OTAs or `OnlineTravel Agencies' may become the norm, as in the West. He cites as examples, Expedia, Travelocity and Orbitz, in the US. These agencies sold about $18 billion worth of travel products, and have an estimated market share of 75 per cent, as one learns from the paper.

What do OTAs do? Primarily, they sell flights, hotels and car rentals; plus, they offer `packages' with all of these components. "They provide very good `deals', using their buying power to get good prices from airline and other travel content suppliers and technology to keep operational costs low."

The Indian scene

What is the Indian scene like? OTAs are coming, assures Jain. "Make-my-trip.com has been around for a while but there are at least 3-4 new entrants who recently have got venture capital funding and will soon be in the market."

A space worth watching, therefore. Jain also speaks about `24x7 help desk and alerts' in BTAs (Business Travel Agencies), and B2B strategies for corporate business travellers. "Pricing will need to get more transparent and simpler. Again, technology and revamping business processes is required for agility and maximising revenue on the one hand and reducing overall costs on the other," points out Jain. Even as the bigger players focus on `technology and revamping business processes' to stay relevant, "the `local travel agent' might well be the Internet kiosk Operator or a franchisee travel shop located at the local petrol station or mall." Exciting?

The ITIL fit

ITIL stands for IT Infrastructure Library. "The most widely accepted approach to IT service management in the world," as www.itil.co.uk educates. "ITIL provides a cohesive set of best practice, drawn from the public and private sectors internationally. It is supported by a comprehensive qualifications scheme, accredited training organisations, and implementation and assessment tools."

Interestingly, the initiative is from the Office of Government Commerce in the UK, "developed in recognition of organisations' growing dependency on IT". ITIL consists of "a series of books giving guidance on the provision of quality IT services, and on the accommodation and environmental facilities needed to support IT", informs the `about' section in the site.

In March 2005, Robert McNeill had written on www.forrester.com that ITIL has taken off in India, driven by the move of offshore outsourcers targeting infrastructure management. Check also www.itlibrary.org, which has a list of people holding ITIL certification in India. But the story that brought ITIL to my attention was that of John Zyskowski on www.fcw.com, dated February 13, cited by IT Business Edge (http://ct.itbusinessedge.com) in a recent e-newsletter.

ITIL is "the spark behind a growing number of IT improvement projects in the US Government, with followers in the military, civilian agencies, and many state and local offices," writes Zyskowski.

"With the help of an ITIL-based consulting service from Microsoft, the Air Force's Air Combat Command (ACC) has made changes to its IT operations that have increased network availability from a percentage rate in the mid-80s to the high 90s." Useful lessons?

Also on IT Business Edge is this lead: Mark Long's article titled Birth of the Enterprise Dashboard on www.toptechnews.com.

"Oracle CEO Larry Ellison keeps track of his 50 per cent stake in NetSuite by using the company's dashboard to track key performance indicators in real time," begins Long, and the article shows a colourful graphical representation of the dashboard.

"A useful dashboard might answer fundamental questions about a company's business, render key performance indicators (KPI) and perhaps compile them in a scorecard, and alert executives and managers to any potential problems. Sales figures, inventory, employee performance and absenteeism, and revenue all might be tracked on an executive's dashboard, for example."

Worth implementing, you'd agree.

Cost of card safety

A new IT Web news service from The Retail Bulletin is on www.theretail-it-bulletin.com. Penelope Ody, its editor, has written in the launch issue dated March 12, about how retailers are facing bills that could run into millions. What for? "To update their IT systems to meet the new Payment Card Industry (PCI) Data Security Standard."

The standard, one learns, is for combating `potential security breaches associated with stored cardholder data'. Ody informs, "MasterCard has stipulated June 2007 for the first phase of compliance which will affect all e-commerce retail sites and retailers handling 6 million or more card transactions a year. These operators need to complete a security audit." A new avenue for accountants?

Endangered auditors!

On audit and compliance, again, ACL Services and OpenPages have announced a `partnership to provide a fully integrated SOX compliance and operational risk management solution'. ACL speaks of its CCM (continuous controls monitoring) solutions, which can provide "an independent control review mechanism to help organisations assure the effectiveness of internal controls, reduce operational risks, minimise profit erosion, and mitigate the risk of fraud, while meeting increasing regulatory requirements."

There's more: "CCM solutions identify errors, fraud, and inefficiencies by independently checking and validating transactions against specified control parameters and business rules. Management and business process owners receive timely notification of control breaches, and can quickly review and resolve potential problems before they escalate." Then, what do auditors do? Operate the CCMs?

ITworks@TheHindu.co.in

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