DoD's New Travel System Gears Up With First Contract

"This contract is an outstanding example of commitment to best business practices, outlined in the Defense Reform Initiative I unveiled last November," Defense Secretary William Cohen said when he announced the contract award in May. He said the new contract, valued an estimated $263.7 million, is designed to cut costs and improve customer service and satisfaction.

Cohen said DoD will also make the new travel program available to other federal government agencies. Administrative overhead is about 30 percent compared to 8 percent or less in the private sector.

"This contract puts in place an automated approach to travel that mirrors the best practices of industry," said Deputy Secretary of Defense John Hamre, who spearheaded the Travel Re-engineering Initiative in his prior job as DoD comptroller.

"When tested in a pilot program, this new approach to travel resulted in traveler reimbursement in half the time, processing in half the steps, and overall administration in one-third the time," Hamre said. "Costs fell 65 percent and customer satisfaction improved dramatically."

Hamre noted that DoD travel used to be handled manually in separate processes. The old way required individual approvals for authorizing travel, arranging accommodations, making travel expenditures, preparing and processing vouchers based on paper receipts and other supporting documents, and reconciling accounts.

"Office procedures for travel included up to 25 separate steps, taking hours of time for each traveler," Hamre said. "The new system simplifies the rules, decentralizes authority to approve travel and builds internal controls into customer-friendly software."

The contract provides a full range of travel services through a common user interface, from pre-travel arrangements to trip authorization to payment.

This interface, from commercially available products, will be available to DoD personnel around the world. It will feature data banks of information on hotel, airline and rental car availability; travel regulations; and numerous other requirements for start-to-stop travel administration, Hamre said.

For example, he said, instead of wading through pages of travel regulations, travelers will use software that pops up "policy exceptions" for approval. These packages will use electronic commerce/electronic data interchange technology to form a seamless, paperless process.

BDM International Inc. won the contract, which will cover official travel for about 200,000 DoD travelers in Iowa, Illinois, Indiana, Kentucky, Michigan, Minnesota, Missouri, North Dakota, Nebraska, South Dakota and Wisconsin.

The new travel system will be fielded worldwide by 2001. DoD money managers estimate an annual savings of about $300 million.