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nspired by the National Performance Review, many federal agencies are identifying and adopting their interpretations of best business practices in travel management. Groups formed to improve federal travel processes are generating a lot of advice for federal agencies that want to travel smarter: Two examples are the Joint Financial Management Improvement Project's travel program, which recommended changes in travel practices in its December 1995 report, Improving Travel Management, and the General Services Administration's impressive Travel Focus Group, which evaluates agen-cy travel policies and procedures.

Federal travel suppliers-airlines, car rental companies, lodging, charge-card and travel agents who contract with government agencies to provide travel services to their employees-recognize that improvement in the way government arranges and pays for travel is overdue. However, it seems to many suppliers that Vice President Al Gore's rallying cry of "make government work better and cost less" is being used to declare open season on the business community.

At a recent procurement roundtable in Washington, representatives from many public and private sectors questioned whether some changes agencies are making in the name of streamlining truly can be considered best business practices since they place a burden or cost on travel suppliers and discourage suppliers from doing business with the federal government. As an example, travel reps cited the Defense Department's proposal to bundle travel agency contracts into 12 large regions and GSA's current practice of accepting bid responses (the government's procedure for hiring travel suppliers) on a pass/fail basis and then "auctioning off" the contract based on the highest rebate, rather than evaluating enhancements and other services offered by each bidder.

Suppliers believe the streamlining of federal travel management and the definition of best business practices should take corporate America's perspectives into account. Admittedly, corporations have yet to formulate a cohesive statement on their vision of best business practices. But we're working on it. My organization, the Society of Travel Agents In Government (STAG), is devoting a session to this topic in its next semiannual conference from the perspective of corporate America. In the meantime, travel service suppliers opinions on changes and proposals are strong and should be incorporated into federal agencies' strategies to improve travel management.

GOVERNMENT'S REPORT CARD

Following are companies' complaints. In some cases, the complaint is that the government is not making any policy changes, and it should.

Travel Agencies. Travel agencies currently bid for government contracts to become civilian agencies' travel management centers (TMCs) and Defense agencies' commercial travel offices (CTOs). So travel agencies regard GSA's new emphasis on crafting a national travel program with dismay. They fear a national travel program would result in megacontracts that only the nation's largest travel agencies could fulfill. The Defense Department's proposal to consolidate upwards of 100 CTO contracts and memoranda of understanding into 12 contracts worldwide, averaging $370 million of contracted workload each, would have a similar effect, travel firms fear. If these changes come to pass, small, locally owned, women-owned and minority-owned travel agencies could be shut out of contracting directly with the government, overlooking government's unique responsibilities to nurture the private sector. And federal employees who get great service from the personal relationships they've built up with local CTOs will lose out, too. A STAG member has proposed instead a minimum of 28 regions, plus international and Small Business Administration set-asides for DoD.

Hotels. The federal travel management improvement movement is ignoring per diem problems. Federal lodging per diems contain no incentive to minimize lodging costs. Given a choice between a hotel room that costs less than the per diem and a hotel room that matches the per diem, most travelers will pick the more expensive room. The government could solve the problem by introducing a preferred hotel program similar to the one in Canada. The Canadian government says its travelers must book rooms at preferred hotels through their contract travel agency's toll-free telephone number, in order to get reimbursed for lodging.

Finally, hotels are calling for vigilance in auditing per diem levels in each geographic market. Why the concern? Prices for lodging are volatile. The per diem allowance for a hotel room in Klamath County, Ore., for example, jumped from $40 in 1995 to $97 in 1996, substantially above local rack rates. Los Angeles now is at the same $97, down from $102 last year.

Car Rental Agencies. Car rental companies report government employees have a high no-show rate for reservations-25 percent. No-shows are costly for car rental companies, who would like to see government introduce a policy to encourage more responsible behavior. One idea would be to require travelers to use credit cards to guarantee reservations. The no-show rate at hotels is a more palatable 10 percent, due in part to the fact that most lodging establishments require travelers to guarantee reservations with credit cards.

All Travel Services Suppliers. Many suppliers stress that voucher processing performance by the National Finance Center and other federal entities needs to be evaluated. Suppliers sometimes must wait several months before receiving payment.

APPLAUSE FOR AGENCIES

Federal travel suppliers don't dislike all the changes agencies are making in travel management. Following are changes that suppliers consider to be improvements:

Airlines. Airlines agree that pre-bidders conferences have greatly enhanced the quality of city-pair contracts. Both the number of city-pair contracts available (for fiscal 1997, GSA is soliciting 6,889 city-pairs, 1,214 of which are international routes) and the average value per contract ($230,000) go a long way to ensure that the best local supplier gets the business.

Airlines also applaud the effort GSA has made to encourage federal travelers to fly airlines that participate in the city-pair program. The percentage of federal travelers who elect to fly contract carriers ranges from a low of 65 percent to a high of 82 percent. Recently, GSA split the government market into Group I and II markets, with a varied emphasis on flight schedules, frequency, equipment type, elapsed time, etc. This has greatly improved use of the contract carrier in each city pair.

Car Rental Agencies. After waiting seven years for a new contract, car rental agencies generally like the one the Military Traffic Management Command has produced. They stress that the key to making it work will be maintaining an ongoing dialog between MTMC and the suppliers to remove much of its vagueness.

Call to Action. "Larger is not always better in travel," observes one of STAG's government travel manager members. Let's all focus on futurist John Naisbitt's call to act locally, while we're thinking of global plans.