Recently, American Banker reported that IBM and JPMorgan Chase are teaming up to deliver an integrated T&E solution that goes beyond just software. The solution marks yet another integrated offering in the T&E and travel sector, and is also suggestive of banks wanting an increased slice of the procurement pie. According to the news, the two global giants "recently entered into a partnership designed to leverage the reach of both firms to offer a discounted Web-delivered T&E spend management service that includes transaction analysis, processing, compliance monitoring and the ability to empower clients with more robust transaction histories to negotiate with suppliers." Travel booking remains separate and the partnership maintains the ability to integrate transactional details from multiple engines.
What's most interesting about the deal from a cost-reduction angle is that companies using the system will gain access to certain IBM discounts in travel and while "the two firms didn't divulge the size of the price discount ... it's substantial." Here at Spend Matters we would still argue that good spend analysis focused on T&E data can help companies mine even greater cost reduction opportunities than relying on third-party managed and/or negotiated price concessions, discounts and reporting. It's a simple fact within procurement that companies often have extremely poor insight into T&E spending details, preferring instead to analyze basic PO and invoice data from suppliers for categories that typically fall within an easier sourcing and supplier management box.
In a recent Spend Matters series Compass Research brief, Analytics and P2P: Using Spending and Payment Insights to Drive Savings and Working Capital Management Strategies (available for free download), we analyze specific T&E spend analysis and cost reduction opportunities, among other opportunities for leveraging analytics to drill into P2P data. Here we begin by suggesting that "Insight into T&E spend, a specialized area that falls within P2P but often outside of traditional eProcurement and invoice automation environments can also yield useful and material results. Analyzing travel agency reservation records, contract pricing, internal organizational hierarchies and internal travel booking system transactions can help organizations identify both immediate and future cost savings opportunities."
In Spend Matters' view, while relationships such as that between IBM and JPMorgan Chase can provide significant value to organizations within the T&E area, we also hope companies take greater ownership of their own data. After all, there's savings gold in your own T&E and travel data -- and it's unlikely that a third party is going to find it all for you.