5Q with IBM's Raymond Curatolo

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March 19, 2009  -  Sabre GetThere and IBM last month announced plans to integrate by the second quarter their respective online booking and expense reporting technologies to offer an end-to-end travel solution that provides "increased visibility into booked versus expensed" data. IBM also gained a new distribution channel--through GetThere and its travel management company distributors--to replace one with American Express lost last year. [As part of its marketing deal with and investment in Concur, Amex terminated its six-year relationship with IBM that produced about 400 joint clients.] Originally developed in the 1980s to streamline its own expense reporting, IBM's Global Expense Report Solutions (GERS) technology has evolved to a newly redesigned, Web-based, global platform used internally and sold externally to process more than 20 million expense reports last year, according to IBM GERS director Raymond Curatolo. Management.travel talked to Curatolo about the evolution of the technology, sales distribution and the latest integration. An excerpt follows. In 1998, IBM and Sabre were way ahead of the curve. We saw the value in [matching] what was reserved in relation to what was expensed by an end user, and we began the integration path. Some of those early learnings have paved the path for what will be a significantly more integrated approach this time. What's different is that the level of data available today versus when we first looked at it years ago has been significantly enhanced. The application layer and the intelligence to audit against certain criteria are much further along than they were at that time. For example, the ability within GERS to write business rules directly targeted at reservation data against what is expensed. You reserve one thing and expense another. The evolution of the application, as well as the data, is significantly different than where we were years ago. Also, the model has changed: distribution of the GetThere-IBM relationship through their TMCs that distribute GetThere, as well as through the GetThere sales force and IBM. Years ago, a company would have one contract with GetThere and another with IBM. Sure, it's the nature of the business. We're a global company that does business with many, many clients on a daily basis. GERS has been built on a flexible platform that enables seamless integration into service providers (booking tool providers) on the front end, agencies and back-end credit card providers, as well as other components that can flow into the expense report system. For example, it can integrate into very high-end accounting within the defense or public sector. In the life sciences sector--pharma, biotech and medical devices--we integrate to provide adherence to state spending compliance requirements. We have the ability to take doctor data, integrate it into the expense report process and feed back data to the corporation on spend by physician, which feeds seamlessly into their reporting to the state. This goes well beyond "How do I capture breakfast, lunch and dinner?" We have a BPO model for GERS where we will provide the application component--the expense reporting system--in a hosted environment around the world for clients. We provide Level 1 call center support, the how-to questions; and Level 2, something a little deeper where a person would usually call their own IT department but now call IBMers located in Argentina. On the back end of that, an employee completes an expense report and is able to fax or scan the receipt package and send it to one of our competency centers around the globe in Manila, Bangalore or elsewhere. The key thing is the technology base. When we have receipts captured through scan or fax and that image is fully integrated into the expense report, we can then leverage the delivery centers around the world because you can be anywhere to complete the process. This is the future of end-to-end expense reporting. Then you've got the economies of scale and being part of a larger pool: The corporation is moving something that was an administrative activity within its accounts payable or finance organization out of its own firm to allow someone like IBM, which has done this very, very well, to allow them to help guide the future direction of the company's sourcing and procurement. It's offered to our clients, available to them. We don't force a new version on clients. Any of our new clients will come up on 2.0. With our existing customer base, we're migrating four or five of them to the new front end, which certainly has the enhanced online booking tool integration capability. We have done credit card reconciliation down to the end-user level, the ability for the end user to reconcile credit card charges themselves. Instead of pulling out 10 different expense reports and trying to reconcile, we provide a very user-friendly means to show all the expenses that have come in and for what expense reports reimbursements were made. The GERS Insight module, built in conjunction with the IBM Research organization, is an analytical tool that looks at patterns, behaviors and trends. It was built off of behavioral shift model research, originally designed to help cancer patients. We have used the underlying technology, designed by some of the brightest minds within IBM, to help in travel. It's deployed as we speak to some clients and has become a very popular item in sales initiatives. The current environment is piquing interest in such tools as Insight. It goes much deeper than just fraudulent behavior. Fraud is certainly there, but if you want to get a clear picture of your travelers, you have to look at their behavior. If you want to reduce travel costs, you may want to tighten policies in a certain area. For years, parking has been a $25 receipt rule within many corporations where expenses under $25 didn't require a receipt. Through a behavioral rule, we may see that people are creatures of habit and they just think parking was $9, $12 or $18 for the day. People just get used to putting in certain dollar amounts. That's an example of doing a deeper dive and understanding behaviors to know where to make adjustments in your process.