Rethinking Data

This analysis appeared April 30, 2013 in Cornerstone Information System’s “Insight & Opinion” section


Data and their application have been a travel industry fixation since ADS was discovered over 30 years ago. When it became practical to collect the specifics of what travel customers were buying, suddenly it was an essential management task, effective competition hinged on being the best data manipulator, and travel managers were left to wonder what they should do with the piles of reports TMCs were cheerfully offering.

Most people are still wondering. Making better decisions that are enabled by travel data is a goal industry experts, acknowledge, respect, desire to achieve, and find surprisingly elusive.

A correct and productive data strategy for the travel industry is not difficult to identify, but its successful implementation requires discarding several cherished ideas.

Big Data…Big Deal

Some years ago, the CEO of a major national TMC (herein nameless) was fond of telling industry groups that it once “came to me in a flash of light that I was really in the information business.”

As I worked for a major competitor, I was also fond of telling the same story–with full attribution to its author. I added that perhaps his next corporate account proposal would be successful if he offered just reports…and no tickets.

Travel is not an information business; it is a service business and many of the most indefensible and irrational travel products were conceived when people lost sight of that fact. Where data support the delivery of effective and affordable customer service, analysis has a role.

Analysis for its own sake has few uses and is something for which most travel managers have a difficult time writing a check.

The current hot topic in reporting circles is “big data,” (ten years ago it was “data warehousing”). Apart from the fact that big data means lots of data from multiple sources, most people are challenged to explain its business rationale.

Under most conditions, “big data” is a term without meaning in the travel industry. Effective managers in all sectors of the industry need realistic business analysis goals, without regard to the size or complexity of a data set. Collecting the most data sounds highly scientific to most people and from that they incorrectly infer that the exercise must be valuable and that ill-defined real-world applications are justified.

Big data might have a role in such predictions as what travelers will buy, but even there the variables are so complex as to confound all but the most determined and expert analysts.

Where’s Your Talent?

Decision support tools for the travel industry have proven difficult to build and maintain, and the few companies that produce truly good ones are highly underrated for the value they deliver. A successful decision support tool enables better, more informed business decisions that cannot necessarily be anticipated when the system and the databases that sustain it are conceived.

As essential to such a system’s success as the skill with which it was designed is the insight it enables for its human operator. Systems people are prone to highlight data, reports, and analysis while overlooking the fact that a skillful, insightful, talented operator is what moves decision support into action.

The system’s role is to make that talent productive.

Without recognizing the role and composition of decision support, travel data analysts are likely to dive down any number of rabbit holes looking for new projects. One good example is the current fascination with data analysis projects that have subjective outcomes.

Systems that contrive to use data for calculating such things as traveler dissatisfaction with policy are ill-conceived in my view. A “dissatisfaction” report cannot escape the subjective and occasionally irrational nature of what it attempt to measure, a problem which is compounded by dozens of other variables that combine to make the result about as meaningless as arguing that green is better than blue.

Successful corporate travel data analysis is built upon clear business goals, and supported by decision support tools that empower insight and better conclusions in their human users.

They recognize the elegance found in simplicity and employ the shortest, most efficient way to deliver their results, and the travel managers using them do well to require specific answers from them to their real-world problems.

Perspectives on Data Ownership: 2013

This analysis appeared March 15, 2013 in Cornerstone Information System’s “Insight & Opinion” section.


Recent popular discussions of “big data” (a surprisingly ill-defined term) are curiously silent on where these data may come from and who should decide where and how they are used. Perhaps this is because the current social media wave encourages individuals and businesses to surrender a degree of privacy (and hence control over data) in return for the promised benefits of whatever service is on offer.

While we may believe that travel data ownership questions were settled long ago, control and ownership questions are more complex than many assume and require careful review regardless of how open or restrictive data access should be.

Everyone’s In Charge

Most travel businesses you speak with will assert either that passenger travel data belong to them or that they have a right to use and distribute them essentially as they see fit.

Corporate travel managers usually maintain that, since they pay the bills, they both own and control the data. Airlines and other vendors often assume the right to use and distribute data about the use of their services, and travel management companies believe they have a degree of ownership because much of the most valuable travel data comes from their systems and exists because they expended energy to create it on behalf of “their customers.”

This travel data ownership conflict is a familiar story, but there are other less evident or considered levels:

A number of processing intermediaries including payment systems, ticket processors, GDS companies, and on-line booking tools assert a right to distribute travel data and reports for their financial benefit, apart from any direct or indirect benefit travel buyers receive. Typically this is done with individual travelers remaining anonymous, but the degree to which “anonymous” travel detail is widely available, down to specific itineraries and dates, would surprise most travel managers.

Many sources also make data available to third-party aggregators, who also operate for their own financial benefit under the assumed anonymity of individual travelers. Such companies produce an array of usage and comparative models, predictions, and similar data projects which find uses far removed from travel management.

Assumed Anonymity

I use this term to describe the broad assumption that, if my name isn’t present, whatever follows doesn’t matter. Anonymity can unravel quickly. It’s hard to argue that the kind of industry-wide data aggregations used by the DOT and others to predict economic trends are threatening, but under the care of a skilled analyst, extensive company-specific and individual travel patterns could be deduced, especially by combining multiple sources.

Interesting Questions

The extent and depth of travel data distribution and usage should at least cause travel managers some reflection, even if they decide they need not be concerned.
Here are a few specific thoughts:

  1.  complete chain of custody affecting anyone’s travel data is unknown–sometimes adequate, elsewhere non-existent. Many companies with data responsibilities have no real data security program in place that runs deeper that simply saying the right things.
  2. How is it that so many travel industry business intermediaries are selling data produced by customer activities for their own benefit? Aggregate industry analytical reports are one thing–distributing detailed raw data to third parties is another. Where did that permission come from?
  3. Have corporate travel managers looked at the type of data being distributed about their travelers in detail and rationalized it with their own company privacy and security practices?
  4. Are travel management companies comfortable with the extent of peer comparison by vendors and subsequent data aggregation that has become commonplace in the industry?

Whose Customer?

This analysis appeared April 9, 2013 in Cornerstone Information System’s “Insight & Opinion” section.


Talking about “the travel industry” often invites criticism that it’s impossible to generalize–travel companies of any description are not identical and can’t be expected to behave as one. This ignores the experience of even casual observers, who see business decisions, successes, and failures widely replicated and frequently repeated throughout the travel industry over time.

There is a continuity within companies that operate in the same field, face similar market challenges, and who must compete with each other that causes them to align similar practices and strategies to an often surprising degree. What is referred to as “institutional memory, (the phenomenon where groups of people working together circulate and perpetuate the same ways of thinking over time), makes such alignments difficult to change.

One such area is ownership and management of the customer relationship. Travel vendors largely think they should be interacting with their customers directly and with as few intermediaries as practical.

This belief predates the coming of The Internet and electronic commerce–it’s varied over decades but never disappeared. In many ways it’s a stronger business force than on-line selling.

The fact that travel vendors generally don’t do an especially good job of interacting with their customers, or of listening to them, doesn’t cancel the desire to remove intermediaries.

If it Were Only True

If travel suppliers deal directly with customers, costs and inefficiencies should decline. More important, it should be possible to protect and preserve loyal customers.

It almost never works that way.

One major impediment is that, to provide effective customer service, you need to listen to your customers and understand what they say. Translating these simple requirements into appropriate actions proves particularly difficult for the travel industry.

With exceedingly rare exceptions, nobody in the travel industry delivers customer service and nobody can–where “customer service” is defined as delivering what the customer truly wants to buy when it is needed.

Airlines are a reasonable example. Do you know anyone who thinks the excessive and capricious baggage fees most carriers are anxious to charge are a good idea? I’ve asked that question before groups of hundreds; apart from a few people with a specific viewpoint to represent, I’ve yet to get an affirmative response. I’ve never even heard of such a response.

The “ATM machine in the sky” approach to airline pricing is a major profit contributor, but it wasn’t designed to please the consumer.

If travel purchasers received everything they wanted by removing intermediaries, they’ve had the past 18 years (since the availability of Internet-based tools) to eliminate travel management companies, on-line travel sellers, and corporate travel departments. There remain necessary services that suppliers can’t or won’t provide.

Listen Here!

Travel management companies usually fail the “customer service” test as well. Even the most sophisticated are good at order-taking, exceptional at listening to customers (much better than vendors), tepid at data analysis and product innovation that addresses real customer needs, and non-existent at informed communication–when was the last time you received a newsletter or e-mail bulletin from a TMC that wasn’t an immediate, no-consequence throw-away?

Customer relationships are the product of continued, frequently arduous investment. They are earned, not simply claimed. Intermediaries such as TMCs and OTAs are valuable travel management participants because they meet real needs, despite their own failings.

Efforts to change that without adding equivalent value are destined to the growing list of management theories that simply don’t apply to this industry.

Improving Travel Industry Research

Once again a new year brings another round of what passes for industry research. Although notoriously over-surveyed, the travel industry remains awash in bad data, ill-conceived and poorly executed research projects, and self-serving studies that are relevant more to the next round of funding or the next newsletter sale than to developing a real understanding of markets and trends.

Eventually the industry may get better at labeling useless research for what it is (the trend is not positive, however), but for now the very few good studies routinely drown amidst the hyperbolae of research that can’t connect with real insight–or those that connect all too well because the result was fairly evident before the process began.

Nowhere is the problem more acute than in the online travel and social media worlds. High-priced research typically reinforces conventional wisdom and assumptions while key customer and behavior questions remain unresolved.

I’ve wondered aloud in past articles why major trade groups show such slight interest in these issues. If the online and social media worlds have such monumental consequences, what precisely could be more important to their members?

Here are a few suggestions for modeling forthcoming research projects. These are similar to suggestions I’ve made in public for 15 years, and hopefully they will help you appreciate the limitations of today’s travel research and be positioned to improve it in the future.

    1)    Broaden the Base

Successful studies need wide participation and sponsorship. Those funded and controlled by a single company or clique are not necessarily bad, but this adds complexities and concerns that are avoidable through planning and execution that strives to include more viewpoints. Addressing the needs of a broad constituency increases both value and integrity.

    2)    Sampling Is Key

Few research projects undertaken in the travel industry describe how the study sample was selected, what the resulting accuracy and margin for error are, or the size of the sample.  This is because these are among the most challenging aspects of valid research–requiring time, expertise, and money to address properly.

Most researchers simply ignore them; the resulting studies are little better than worthless.

If you peek under the covers only slightly at a surprising number of major industry studies, you’ll discover that the sample essentially self-selects. The researchers won’t explain how their conclusions in this environment are valid because they aren’t–and they can’t.

There are many parts of a study that has sufficient statistical validity to become the basis for real-world conclusions and predictions, but one is usually that a valid sample must be defined and identified in advance of the research and then the study must continue until it reaches the sample as defined.  More work than most researchers want.

    3)    Questions, Questions

Any question-based research should disclose the questions used and how these are presented.  Forming valid questions is a significant undertaking–which is frequently botched.

During 2010 I was treated to a trade conference  where the expert presented study results to show the importance of the field where he was the market leader and that was the subject of his presentation.  The self-selected sample were asked a variety of simplistic questions with many obvious answers:

“Is cost-control important in your business?”

Have you ever met anyone who would answer “no?”

When the presenter reached some study questions that were clearly silly, he remarked,

“Well, my staff assembled these questions and I should have reviewed them better.”

In other words, the presentation is a waste of everyone’s time–which also says something about the extent to which some conference organizers vet their presentations.

    4)    Seek Wide Input

Limiting control over a study to its sponsors or other “insiders” cannot but color the result as self-serving. Enlightened researchers learned along ago that the “best and brightest” often don’t work for them and they seek such talent out wherever they can find it.

    5)    Dump Hyperbolae; Focus On Quality

The industry doesn’t need another round or praise describing how great the opportunity of the day may be. What’s needed is thorough research and careful answers that relate to business concerns and allow the reader to reliably take action.

This simple definition disqualifies most of the fluff-laden e-commerce and social media studies of the past few years. There are people who know how to do real research–it’s a mystery when their input is so clearly lacking in the major reports of today.

    6)    Analyze

As there are competent researchers there are also competent interpreters who can make connections between abstract numbers and real business situations. Their work ought to by key to any research project. A study lacking informed, usable conclusions should be first into the worthless bucket.

    7)    Validate

There’s a saying that teaches thus:

“Premises that are absurd when projected into the future were absurd to begin with.”

Researchers and readers alike need to apply logical tests in order to understand the validity of a study’s conclusions.

For instance, most predictions about the fantastic growth of mobile, social media-based, or other new media travel purchases assume a level of personal computer use and literacy throughout society that is simply absurd within the time frames considered.

Clearly studies are failures when they cannot withstand the test of reasonableness.

    8)    Forget “Guru” Mentality

Research is ongoing and the “final word” on most topics will likely never be written. Successful research projects are willingly subject to critical review and are revised in light of new viewpoint and data.

A premise holding that the oracle has now spoken and nothing further may be added only highlights the underling weakness of the research in question.

 

Managers and Leaders

In a 1961 address, President John F. Kennedy called for the United States to commit itself to “landing a man on the moon and returning him safely to the earth” before the 1960′s ended. This goal was advanced together with a number of other national goals the president put forth at that time.

The space program, undoubtedly among the most enlightened and visionary initiatives of the 20th century, brought about untold advances in all scientific fields.  Among its short-term goals was to show the superiority of U.S. science, engineering, management, and political leadership.

Kennedy speaks of the initiatives he has just announced and says that we choose to go to the moon in this decade and do the other things,

“Not because they are easy, but because they are hard.”

Few of us will be called upon to motivate an entire nation to action, but in the small ways we are asked to lead others, remember Kennedy’s words and also remember that doing hard things is not only possible, it creates often insurmountable obstacles to competitors and adversaries.

Managing for peak performance is one of the most difficult tasks you’ll ever attempt.  Whether your business is large or small, and whether you have major development projects in progress or simply want someone to handle training for three people, the formula for managing technology routinely eludes most people.

The first key to managing is recognition that management is the wrong word and the wrong premise.

I’ve always taken the somewhat extreme position that few things of real worth were ever built, assembled, found or perfected by managers.  True excellence in any field comes from differentiating between managers and leaders.

Once that step is made, it’s possible to do truly great things.  An army lead by managers is composed of conscripts and mercenaries because the people actually doing the work neither wholly believe in nor accept the cause for which they labor.

Likewise, projects or offices staffed by people who just put in their time as long as their paychecks keep coming are ultimately destined for mediocre results from partial commitments and average efforts.

Only when an army is truly led, and when the efforts of the participants are measured by the fact that they wish they could do more, do conscripts become patriots.

In a business sense, the ability to go beyond what everyone else is doing or to take a giant step is driven by personal commitments from exceptional people–the kind who will do anything for the right leader.

Leadership is so elusive that you almost never see it in business. No doubt you can think of many people who have been reasonably successful while managing.

But if you know of anyone who did something extraordinary in business–developed a radically new product, launched an enterprise with no capital and little experience, or did what others had tried to do and failed–chances are part of the reason is that this individual stopped managing and started leading

Given enough money, time and staff, you can complete a project and get workable results–results that also will be fairly common (uncreative), rigid and not years ahead of the competition, by managing people who simply put in time.

Most businesses find this formula too expensive and limiting to be useful.

Achieving the exceptional result–something very difficult to replicate and extremely valuable to your business–depends on attracting, motivating, leading and keeping the right people. Don’t blame the staff for the lesser result–the fault is usually at the top.

Ernie Pyle, the great World War II news correspondent, once wrote that the success of any enterprise is determined by the morale of the group. Morale, he said, depends on two factors: commitment to the team and complete confidence in its leaders.

  • A leader stands at the head of the group and asks the other members to follow as he addresses the tasks before them.  A manager asks the group members to work as hard as they can, but measures his own success by different standards.
  • A leader doesn’t ask anyone to do things he hasn’t or wouldn’t do it himself. A manager thinks most jobs are for underlings and that he has “special skills.”.
  • A leader shows the kind of genuine commitment to the project he expects everyone else to show; by implication, he wouldn’t be involved if he didn’t believe in the project. A manager just follows orders and puts in time.
  • A leader has the highest professional and personal standards. A manager will often tell others to do what it takes to get by.
  • A leader holds his position because he’s shown he has what it takes to get the job done.  A manager often occupies his position because he’s been there the longest, knows somebody or just happened to be appointed to the position.
  • A leader doesn’t necessarily know everything, but as long as he can apply the skills of other experts, the project can succeed.  A manager feels he might fail personally if someone else is shown to know something he perhaps should.
  • A leader puts the project first–if it fails he fails. A manager usually has somewhere else to affix blame.

The biggest problems to be faced in any type of project are almost always management, and not operations-based. To successfully overcome them, you don’t need smarter people: you need to become the type of person smarter people will follow.  You and I can both look at most organizations in our industry and see that they’re not performing at peak efficiency.

Morale, something most managers never seem to notice, is among the primary indicators.  Leadership doesn’t wholly take the place of money, or the right tools, or skilled professionals, but it does give these elements a chance to do something really useful.

You can produce real competitive advantages, but you’ll rarely ever succeed until leadership becomes first priority.

 

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