Does your organization have a business travel policy? Does it need one?
There are a number of reasons why a business might not have a travel policy in place, but it is worth considering the benefits of one in terms of bottom line and organizational improvements.
5 Reasons Travel Policies Are Important
If you have a policy in place, everyone in the organization should follow it. So no, the CEO doesn’t get to buy a first-class ticket if everyone else is flying economy. With established rules in place, employees know the score, and the grey areas are eliminated.
Plus, any resentment that employees feel towards higher-level executives with regards to travel will be lessened. Everyone is in the same boat (pun intended).
If an employee is showing “cabin non-compliance” and booking first class tickets when they should be flying economy, it may be that your travel policy is confusing and they do not understand what is expected. There is also a lot of room here to cut costs when everyone is in full understanding.
2. Automation Removes Yet Another Decision
We all have hundreds of decisions to make each day—from those little daily questions such as, “what should I wear today,” to the more crucially impactful ones such as when to launch a new product or alter the company organizational structure.
A company policy that lists acceptable and approved travel agents and hotel chains takes out the decision making process for employees when they are arranging business travel. The fewer decisions that we have to make, the less we suffer from decision fatigue.
3. Employee Comfort is Guaranteed
Managers should approve hotels that they know are clean, comfortable, and provide employees with everything that they need in order to be happy. Nobody is at their best when they are uncomfortable and stressed, so ensuring only accommodations that have been assessed for their level of quality are approved in a travel policy helps eliminate the chance of a bad nights sleep.
When a company policy can reduce the risk of bad service, noisy rooms, and feeling unsafe for employees, the traveler’s state of mind will be clearer and much more focused on work.
4. Cost Optimization
A travel policy will work to optimize costs in a number of ways. The most obvious, is outlining services that are acceptable. Stating for example that employees should book to stay in a single occupancy hotel room rather than a suite, could save the company hundreds of dollars a night. A travel policy means that limits are set on the type of service booked, and that there is no confusion over what is and what is not an acceptable way to spend company money.
Travel managers can also negotiate deals with airlines or hotels. Most travel services place a lot of value on a potential corporate client, and so are willing to bend a little (or a lot) in order to win their business.
5. Data Is Knowledge!
Booking visibility—where a company can clearly see how and when employees are booking travel and analyze that data—can lead to the knowledge and understanding that facilitates substantial savings. Companies with a well managed travel program have a lot more information when it comes to analyzing revenue and costs. If the cost of business travel is rising, and company revenue is not, how do companies make the right decisions regarding frequency of business travel?
With the data provided by a business travel policy, companies can benchmark their own spending against that of the industry average or a competitor to see if they are spending too much or too little.
Especially in larger companies where millions of dollars are spent every year on travel, saving 5 percent on flights or 10 percent on hotel accommodations will make a sizable difference.