Consumerization in the corporate payments space may be no more present than it is in the business travel arena. Employees are naturally using the same technologies and payment tools while they travel for work as they do in their personal lives, and travel managers must keep that in mind when designing travel programs that meet both corporates' and employees' needs.
The consumerization of corporate travel means employees are often at the front lines of technology adoption for their firms. It's why Miriam Moscovici, senior director of research and corporate innovation at global corporate travel management firm BCD Travel, said that the hype surrounding technologies, like blockchain and artificial intelligence (AI), aren't overblown when it comes to the business travel landscape. In fact, she recently told PYMNTS, travel management companies (TMCs) and travelers are pushing for implementation of these tools as they demand more dynamic, real-time data and decision-making.
Take the strategic supplier sourcing process. According to Moscovici, TMCs want to be able to react to market changes and contract negotiations in real time, rather than renegotiating contracts on an annual basis. Blockchain, she said, and the smart contracts it enables, can be especially useful in this case.
"Blockchain will enable us to adjust a contract term no longer relevant in the moment, penalize for contract terms not met on either side [and] automatically introduce new suppliers when they become relevant — in real time," she said. "There are a lot of indicators that the market is ready for this level of sophistication."
The possibilities of blockchain, AI, bots and other innovations were outlined in a recent BCD Travel report on emerging technologies in the travel management market. In BCD Travel's first paper of its six-part Inform series, researchers examined how these tools might affect the supplier sourcing process. That includes the selection of suppliers and their products, pricing, contracting and payments.
TMCs are looking to turn these processes into flexible, real-time actions, said Moscovici.
"[The industry] is starting to talk about things like dynamic performance management [and] dynamic policy management — meaning our market is looking for ways — in the moment — to adjust and manage goals, instead of a batched, year-end process," she said.
One of the largest barriers to corporate adoption of technologies, however, is resistance to change. According to BCD Travel, tools like bots are headed for major disruptions in sourcing and other corporate travel processes. Bots can, for example, automate the bidding process from airlines or analyze the best mode through which to arrange a meeting with those vendors.
Moscovici said that corporate travelers and managers retain the habits of their personal lives, meaning adoption of new tools is a much smoother process.
"In the business travel space, our customers and travelers are born in the consumer market," she said. "Their appetite is ripe for the consumer experience in travel. We think it's not so much about them shifting to one [technology] over another; it's about them having the choice to execute their desired interaction."
Adoption of leading-edge tech is a natural evolution of corporate travel management, she noted, as the enterprise develops a view of corporate travel as a way to drive value for the organization — supporting employee retention, customer satisfaction, employee wellness and how a business trip drives a company further toward its overall goals.
Business travel is connected to multiple areas of the enterprise, from procurement to the chief executive officer and, of course, finance. Today, the supplier sourcing process often includes discussions on how to pay those vendors and, according to Moscovici, this is one part of the industry that is in great need of disruption. Moscovici and her team will be examining these points of payment friction as BCD Travel continues production of these reports, which will include policy, duty of care, payments and others.
"One big problem is [that] payment is fragmented around the world," she stated, pointing to the U.S.' recent adoption of chip-and-pin payments as an example. The lag meant corporate travelers would experience significant friction when attempting to make payments in Europe, for instance, at a train station ticket booth. Meanwhile, in Asia, contactless payments have established their roots.
She continued, "It doesn't make any sense. The fragmentation and diversification of payment solutions around the world becomes a challenge when you're talking about global and multinational businesses trying to create consistency in experience and delivery at the enterprise level."
It's one area in which technological innovation may have solved some problems, but created new ones, with each jurisdiction adopting different tools and existing on different planes of innovation. Payment friction in corporate travel is a particularly challenging nut to crack for technology and service providers, too. According to Moscovici, points of friction often aren't even apparent until a payer is faced with a challenge.
"Especially in the world of payment[s]," she said, "these boundaries are only apparent when you're a human trying to cross those boundaries — and your card doesn't work."