Like almost everyone who’s asked themselves hard questions during the pandemic, Kurt Ekert also took time out after he left his CEO role at CWT. “I was doing a bit of board work, I needed to recharge my batteries. After spending 30 years at work, it was good to step back and take a pause in life.”
That pause was interrupted late last year when he met Sean Menke, president and CEO of Sabre Corporation, who told Ekert of the dramatic transformation at Sabre, accelerated by the pandemic, and how this was a unique moment in time to drive innovation and change in the industry.
It was too good an opportunity to resist. After all, Ekert, who joined Sabre as president in January of this year, has spent most of his career driving change in travel distribution and technology, and all the forces today point to this moment being a pivotal time for real change. Before CWT, he was with Travelport and prior to that, Cendant, GTA and Orbitz – all companies that have undergone massive change in one way or another.
Says Ekert: “What this demonstrates is, the pace of change is very strong and this has only been accelerated by the pandemic. What separates winners from losers are, winners do not rest on their legacy laurels and are willing to disrupt themselves for their stakeholders.”
And that’s what Sabre is willing to do as it undergoes its most dramatic digital transformation yet, a process which started pre-pandemic … “off the mainframe into the Google Cloud. We are halfway through that journey and that tech transformation will give us efficiency advantages, drive innovation and develop at a pace that will give us an advantage over our market competition.”
Corporate travel an area of interest in Google partnership
What’s interesting about the GDS environment currently is that Sabre is not alone in partnering with a tech giant. Travelport has teamed up with Amazon Web Services to launch a travel startup accelerator. Amadeus has chosen Microsoft and this week, announced it would embed its Cytric booking and expense platform into the Microsoft 365 suite of tool, enabling users to search and book travel within Microsoft Teams and share trip information in Teams, with colleagues giving them the option to book the same trip.
Asked why the rush by GDSs to partner with tech giants, Ekert says, “Choosing Google as a tech partner will give us efficiency and cost advantages. It gives us an innovative platform to innovate for the future. It’s not just a cloud relationship – we will look into how we can use their AI and ML capabilities in our product line, in a way that’s good for our customers.”
As to whether it would work with Google on bookings, as Amadeus has done with Microsoft Teams, he says that while there was no specific plan he could speak about currently, “there will be some innovations with Google. Corporate travel is an area of interest. What Google is good at is data, running algorithms. We are confident that with the relationship we have with other TMCs, we can bring unique value elements to corporate travel.”
Corporate travel is of course an area Ekert knows well, having spent five years as CEO of CWT. Saying “its demise was great exaggerated” at the start of the pandemic, he is confident that the industry will see very similar recovery curves in corporate travel as it has seen in leisure travel.
“It’s been a dislocative two-year event for the industry but we have weathered the storm well. We are now enjoying a full-blown recovery. It started with leisure and domestic, then short to long-haul traffic returned. Corporate has also rebounded.
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“Recovery is slowest in parts of Asia but we are beginning to see the demand curve going up in India and Australia. We are well positioned with a motivated workforce and concise strategy to ride the recovery well.”
Says Ekert, “In the first year of COVID, the thesis was that corporate travel would be permanently negatively impacted, that web interfaces would largely replace corporate travel. That’s changed in the last six months. It is unclear how it will land in the longterm – there will be some dislocative impact longterm – but once a competitor goes out to see a client, another will do so.
“With work from anywhere as well, employees are not in the same location – so internal corporate travel will be more important than ever to form the culture in an organization.
“I am fairly bullish that corporate travel will return to previous levels. Perhaps in Anglo markets such as the U.S., U.K. and Australia, it may be less robust and there will be a relatively larger share of the pie from the developing world. Pre-pandemic, China was the larger corporate travel market than the U.S.; growth outside the Anglo world will accelerate.”
The competition for tech talent – “we have to learn how to make this work”
To compete for tech talent in a work from anywhere world, Ekert says: “We have to learn how to make this work. It serves up new challenges. We have to make workspaces more attractive to get people in – in certain functions, work from anywhere will be a norm, some functions will be hybrid. We have looked at and implemented wellness programs.
“As we think of the competition for talent – compensation is important, so is work environment – but people want to do impactful and fun things. We have a ruthless focus on tech transformation and we are making big bet investments – and that will attract people who want to make a difference.”
Another thing it is doing differently is replacing individual performance reviews with team performance reviews. “The team is what matters,” says Ekert.
Asked how GDSs will continue to remain relevant in a market where connectivity is now much more open and there are startups bypassing the “gatekeepers,” Ekert likens it to the cable TV industry and “now there’s streaming and a different way to distribute and consume content.”
“There is demand commercially and tactically for new models of distribution and suppliers want to sell as dynamically in B2B as they do in B2C. It is up to us to offer and normalize content. In 12 to 18 months, I have no doubt we will be the NDC intermediary leader in the world – it is up to us to reinvent and disrupt ourselves and use the more traditional model where it makes sense and different commercial models where necessary.”
He sees exciting opportunities in tech innovation for both airlines and hotels. “In hospitality, over the course of 10 to 15 years, most of the revenue growth by large hotel chains has been by adding additional properties, it’s not come through rate or ADR. Now that development is slowing down, there is a need for more profit per property – ancillary revenues, local tours, sightseeing – retail and merchandising tools will benefit hotels.
“In airlines, over time, the lines have blurred between low-cost carriers and network carriers and the traditional divide between distribution and revenue management will get narrower.”
“What happened with OTAs is now happening with TMCs”
Travel agencies have been hit hardest by the pandemic, he notes. “The ones that have done well have loyalty with customers, they became their trusted advisors. That happens offline but it also happens online with the right tools.
“What happened with the OTAs the last 20 years is now happening with the TMCs. There will be a technology arms race in the sector and to have product and innovation at scale, you need scale so if you are larger, you will have a structural advantage. Those with the capabilities to invest will separate themselves from the pack.”
He says the pandemic had made Sabre stronger at focus. “It allowed us to refocus and we want to be the leading platform player in the industry. We are in the peak year of our tech transformation journey and that will give us a much more efficient tech stack to innovate and get better at things such as airline and hotel retail merchandising. We are solving for the IATA One Order world and our retail and merchandising solutions will be far more dynamic than in the old construct.”
He says his past 30 years’ experience working with various companies has proven that “culture trumps strategy and it’s what drives execution. How well we articulate the culture and execute is critical. I am joining a strong culture that drives empowerment and innovation.”
Ekert calls himself a prodigious reader – he read a total of 200 books over the last two years. “I like business narratives. I read books about Netflix, Boeing, WeWork, Nissan – exciting interesting stories looking at where companies succeeded and where they fell on their face. It always came down to leadership and culture of the organization.”
Asked when the book about Sabre would be out, he says, “We are not ready to write the book yet, we just want to win in the market.”
* This article originally appeared on WiT