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travel tech insights

Putting the Back Office First: How Travel Companies Should Embrace Automation

The back office. It’s a curious space - akin to a No Man’s Land - within the travel industry that doesn’t operational processes in travel agenciesreceive much play or attention either from travel companies or those operating within the tourism sector. In today’s world, an interesting dichotomy of focus has developed within the travel industry as to how travel companies direct their resources: Customer-facing activities such as managing customer relations via social media, or optimizing the services and products offered by deploying software solutions in conjunction with suppliers or distributors.

The back office, however, where a majority of a travel company’s operational activities such as invoicing, procurement, and payroll are housed, is often overlooked by travel companies as they work to remain competitive and profitable in the aforementioned customer-facing arenas.

Out of sight, out of mind. It’s a cliche for a reason, and these back office activities often fall prey to this time-tested expression. But in order to foster truly lean, efficient operations at each touch point of the value chain, travel companies cannot afford to gloss over the benefits back office automation can provide in terms of decreasing costs, increasing revenue, and promoting growth and productivity - especially when, as back office and front office tasks become more entwined, the distinction between operational and customer-facing activities bleed together.

An enterprise resource planning system has the capability to deliver an integrated suite of applications for front office, mid-office and back office business processes. To help illustrate the importance and value proposition of automating back office processes and deploying an ERP planning system for optimal productivity and efficiency, let’s look at a few examples of such tasks and how a back office ERP solution works to streamline these once manual, time-consuming jobs.

Cutting costs: Perhaps the most evident value proposition of automated the back office, ERP planning systems allow travel companies to significantly reduce operational costs by removing a number of manual processes from the hands of employees and merging them into intelligent, optimized planning systems with massive computing and data storage capabilities. For example, let’s look at vendor performance reports, which can take 2 to 3 employees several days to review and analyze via multiple spreadsheets or other manual data management systems. While this task is often so entrenched in the routine of the back office, such tasks can cost companies thousands of dollars per year in sunk time and resources. ERP planning systems can achieve the same analytic and storage goals in a fraction of the time, allowing employees to focus on less menial tasks.

Reduction in human error: As we just discussed, so many back office tasks in today’s travel industry are managed by teams of human employees, which can be a liability in terms of time and resources. But it can also be a potential problem when it comes to human error, an element which automation via an ERP planning solution can virtually erase from the equation. Deploying an ERP planning solution significantly reduces the likelihood of data processing or storage errors across a wide spectrum of areas - everything from payroll to invoicing to human resources paperwork - which means increases in accuracy, productivity, and profitability. Simply put, travel companies can allocate time, resources, and materials to other areas when they’re not preoccupied with double-checking manual processes or correcting errors which may implicate several touch points of the value chain.

More responsive operational platform: Let’s say errors in the back office do occur - an invoice is mismanaged, payroll is delayed due to bottlenecks in the workflow, or contracts and agreements between suppliers and distributors are not processed with the necessary efficiency to ensure the movement of said products or services to customers. Deploying an ERP planning solution gives travel companies the capacity to quickly identify the nature of the problem or delay and implement actionable data to take correct measures without diverting employee attention or resources from current projects. In addition, the computing power of back office automation provides travel companies with real-time insight into this process, creating enhanced visibility and transparency across the value chain. The ability to take a more holistic view of a travel company’s chain of products and services makes for a more responsive operational platform and allows travel companies to effectively manage bottlenecks or disruptions with creating a domino effect throughout the value chain.

As you can see, putting the back office first with automation via an ERP planning solution is not simply something travel companies should consider after they address customer-facing or front office concerns. On the contrary, back office automation should be a prime area of concern for travel companies in leveraging enhanced, streamlined operational processes which can very well impact other areas of business, such as customer relations, marketing, supplier-distributor relationships, and other key areas.  Making the back office a priority will not only make a travel company more agile and responsive, but it will also help set a path for a more productive and profitable future.  

Back office automation for travel agencies

Topics: erp travel erp back office automation travel back office