GUEST: AmTrav's Fichtelberg On How Third-Party Tech Inhibits TMC Innovation

Craig Fichtelberg, co-founder and president of Chicago-area travel management company AmTrav, discusses how an over-reliance on third-party technology and tech integration is the enemy of true travel management company innovation.

Elon Musk took a novel approach to building the modern electric car: He removed all basic assumptions and standards and redesigned the car from the ground up. This is the approach corporate travel agencies should have taken years ago.

Instead, they took an archaic travel backbone and added layers of third-party products to the core. As traveler demands continued to evolve, business travel agencies piled on more and more third-party tools to their offerings: reporting tools, after-hours support, duty-of-care services, hotel tracking, expense management, flight disruption, itinerary management, call center support, quality control, mobile apps, etc.

The strategy of innovation by integration may have been the path of least resistance years ago, but travel agencies today are so deeply buried in third-party products they are incapable of digging themselves out. Instead of taking the Elon Musk approach and building a new, innovative solution from the ground up, travel agencies have basically commoditized themselves in the marketplace, offering the same third-party solutions as everyone else. The business travel market needs a new model, a hybrid that bridges a single, centralized travel platform with an in-house customer support team, all under one roof.

Business travelers are the ones who have shouldered the negative repercussions of innovation by integration. First off, there are obvious costs associated with each third-party product, and those costs ultimately get passed through to the traveling company. For example, if a travel agency uses a third-party corporate booking tool to support its online travel offering, it pays that third party up to $5 per booking. So if the agency's online fee is $10, half of that goes to the third-party provider. Those third-party costs add up exponentially when you start factoring in reporting, after-hours support, mobile apps, etc.

Second, innovation is stifled to the point of nonexistence. In a single platform, it is very easy to innovate as it only involves one team of developers working toward improving a unified solution. In an integrated environment, all of the third-party products need to communicate with each other. An enhancement to any one third-party product creates a crippling wave through all the integrated partners. This is the primary reason corporate booking tools have fallen so far behind leisure booking tools. Innovative abstinence has been the chosen path of most corporate travel agencies because trying to orchestrate so many separate companies toward a common goal is near impossible.

To truly complete the hybrid travel management solution, you need to pair the technology platform with a best-in-class, in-house support team whose job is to complement the technology platform, not make up for its shortfalls. You need a support team that you can reach by direct phone lines__not through phone queues__who can instantly respond to live chats, texts or emails. If you call at 3 p.m. on a booking and then live chat at 3 a.m., you should be able to pick up right where you left off.

Peter Thiel, the founder of PayPal, originally set out to completely automate the mobile-payment process but was consumed with an overbearing amount of fraud that rendered the business model ineffective. Thiel's response was to create a hybrid solution that combined credit-check algorithms that isolated high fraud and handed those off to human experts to validate the sales.

PayPal's human-computer hybrid eliminated the threat of fraud and allowed the company to prosper. A multitude of technology-only solutions addressing one aspect of travel surface in the business travel marketplace on a regular basis. But the majority of them never see the light of day. These companies quickly discover that it takes much more than a stand-alone app to provide real value to business travelers and move the market.

The marriage between an innovative, all-in-one online travel platform and a complementary human support team__a "hybrid solution"__is the only way to provide business travelers with the easy-to-use online tools they are looking for and the essential offline support they inevitably need.

Business travel should be straightforward and easy, not the chaos created by an amalgamation of third-party companies that has become the accepted status quo today.