Today's travel marketplace offers an array of choices. Airports are upgrading their facilities, access to lounges is expanding, ease of check-in is improving with TSA Precheck and Clear. Wi-Fi is available at airports, on flights and in coffee shops. There is a hotel for every lifestyle. On-demand ground transportation options abound. Travel management companies can anticipate flight disruptions. Location-tracking boosts traveler safety and security. There are mobile apps for every element of your trip. Even expense reporting is getting easier and more mobile friendly. In short, travelers have never had it better, so there's little incentive for them to go outside the company's travel program.
Take Advantage of the Times
In the midst of this positive environment, companies should focus on the right things. Too often, corporate travel managers and procurement professionals focus on increasing year-over-year savings by squeezing an extra discount out of a travel supplier. And while that will result in some demonstrable dollar savings, companies overlook an opportunity for much larger savings.
To maximize cost savings, they should focus more on travel policy compliance. Instead of focusing externally, companies will find the greatest savings in traveler compliance with smart, well-constructed travel programs. Increasing compliance will yield savings, as well as a wealth of information. One of Travel Leaders Corporate's clients, for example, believed its Americas travel spend was $2.5 million, only to find out through data that it also had over $5 million in out-of-program spend. The program had been going out to negotiate with suppliers based on $2.5 million in spend rather than on its actual $7 million.
Senior leaders should insist that travelers work inside the program to take advantage of the high levels of innovation, savings, visibility and control. In bypassing the travel policy, travelers are not getting a better experience, and once you factor in the amenities, waivers and other value-adds the travel buyer has negotiated with preferred hotel companies, prices aren't significantly lower, either. And, if a traveler needs aid, the TMC can't help if it doesn't know where the traveler is.
Of course, this assumes that the travel manager has worked in partnership with his or her TMC to craft a relevant and modern travel policy. The key is using your travel data and polling noncompliant travelers to understand why they spend out of policy. Armed with that information, the travel manager and agency can deliver a policy that takes travelers' views into account.
Travel policies—like other policies for contracts, compliance and hiring—are meant to be followed for the benefit of the traveler and of the company. When companies make exceptions or send messages to travelers like, "It would be great if you could comply, and thanks if you do," employees won't take the policy seriously and will miss out on the greater benefits of the program.
Communication is vital for employees to understand the value of a strong travel program. If low fares are to be found, the TMC will find them; air and hotel price monitoring and rebooking are available from third parties like Yapta, Tripbam and FairFly, and some TMCs have their own fare-checking technologies.
Understanding of travel needs and wants, coupled with good fiscal controls, is the key. Incentivizing travelers through gamification—i.e., Rocketrip—incorporated with tight policy enforcement is a winning combination. Pointing out that employees don't go out and procure their own health insurance or computer equipment may help employees understand why travel policy compliance makes sense.
Once a travel program has been built with input from employees and once employees have been educated, consider declining reimbursement for and pushing back on those who book outside the travel program. I worked for a company that had this policy, and while this is controversial, it was effective. The employer also did not reimburse late charges, alcohol or any expense over the limit or that didn't have an itemized receipt. Companies need to balance flexibility for employees with controlling costs, which contributes to shareholder value.