More Services Are in the Cards

ntil now, if you traveled for the government, American Express was your charge card of choice. No choice, that is, because AmEx was the sole contract holder for the government travel card.

No more. On Feb. 10, the General Services Administration awarded contracts to six vendors for the next round of card services. Four of those companies-American Express, Citibank, NationsBank and US Bank-will offer travel cards. All four will be competing to win your agency's travel business.

The new contracts run for five years with up to five one-year renewals. GSA estimates that the four card lines-travel, fleet, purchase and integrated-will generate more than $100 billion in charges over the next decade.

GSA has been pushing charge cards, encouraging agencies to streamline their administrative and financial processes and cut down on paperwork, thus saving the government money. The government also gets refunds from card vendors.

Have It Your Way

Flexibility is the buzzword for the new contracts. As agencies negotiate with card companies to set up their own travel card contracts, they can tailor the menu of services to meet their needs.

"One contract for such a large population was inflexible," says Dan Goren, senior vice president of American Express government services. "It didn't take account of variations [in what customers needed]. It used to be 'one size fits all.' The [new] award provides flexibility that looks much more like the private sector."

That was GSA's aim. Sue McIver, director of GSA's services acquisition center, is proud of the array of choices now available: "It's not a government-only system; we'll see the same services as the private sector."

On Your Marks

GSA opened the card contracts to competition for several reasons. AmEx's existing contract expires in November, so some change in the travel card was inevitable. But the changes were bigger than might be expected because:

• The existing contract was inflexible.
• New capabilities and technologies in the charge card industry were unavail- able to agencies.
• Competition has come to be seen as good for business, even if that business is government.
• Agencies needed to get purchase, travel and fleet systems on board with reengineering efforts.

The travel card generated more than $20 million in refunds to the government in fiscal 1997. Under the new contract, refunds will be paid directly to agencies based on charge volumes.

Agencies also can negotiate for special incentives that could generate additional millions of dollars in refunds. The incentive schemes vary from vendor to vendor, but include refunds for things like paying bills quickly, cutting down on losses and fraud, paying bills electronically and getting invoices daily.

On the Edge

The new card systems, most of which are set up to operate over the Internet, will provide capabilities beyond most agencies' dreams. Using their computers, travelers and travel managers will be able to open new accounts, close accounts, create and download reports, retrieve billing files, reconcile accounts, file and process disputes, and allocate costs. "And as technology develops, the government is positioned to take advantage of it," McIver says.

The first changes government travelers are likely to see as a result of the new con tracts are new company names on their travel cards. But bigger changes are in store. For example, the day soon will come when travelers will carry cards loaded in advance with per diems. They will register at a hotel by having their cards scanned, automatically applying frequent traveler credits to their accounts. Then, the same card will be programmed for room access.

At least that's what card companies are hoping. With the U.S. government-the biggest company in the world-creating demand for advanced services, private industry will be forced to adopt the infrastructure to make such services possible, or so the contract winners believe.

"We see this as a catalyst for change in the commercial sector," says Cathleen Raffaeli of Citibank. "New technology can reinvent the way everyone does business." Adds Scott Collary, senior vice president of NationsBank, "The federal government is the largest customer and will leverage that into change for our corporate clients. Government will drive new standards."

In the future, "smart" cards that can store value and employee and personal information also will be used for accessing food services, buildings, data, weapons processing at armories and more. Travel managers should be able save time and paper with the new contracts. Reports once available only on paper can come over the Internet and can be downloaded into any spreadsheet program.

And though an agency may pay more for optional, or value-added services, GSA asserts that administrative savings will offset the costs.

"The biggest opportunity is to reengineer how we process, authorize and approve travel expenses," says Ted Woronka, deputy director of finance management at the Interior Department. "Government is going to be a smart customer. We're creating competition and we'll take it to another plane. More products, more offerings equals more service."

What Next?

For now, agencies are busy selecting card vendors, and card companies are busy vying for agencies' business. Each agency will set up a selection team, likely made up of its chief financial officer, administrative director, procurement staff and others, to identify and define requirements and do a task order-standard or tailored.

Agencies must be smart shoppers, choosing among four travel service providers, "each of which brings something different to the table," says McIver. Agencies can work with one company or many for travel, purchase and fleet cards.

Some agencies already have put together their teams and have surveyed card users to find out what works and what doesn't in the current contracts. They'll use that information to design the task orders.

By Nov. 30, task orders must be final, training of managers and travelers complete, and cards in the hands of travelers.

For more on the new charge card contracts, or for copies of sample task orders, click here.