As the leader of a team who travels to get business done, you need a travel policy if you are going to cut costs.
Your travel policy is the backbone of your company’s travel and expense management program. It is the gateway to greater cost efficiency, safety, and productivity for employees who travel for work. But unless employees comply with its restrictions and parameters, it’s more like a GPS that drivers choose to ignore at their own – and their company’s – peril.
A travel policy can be as simple as “keep your spending in check” and as detailed as selecting approved airlines, hotels, and fare classes.
Whatever your travel policy, lackluster compliance can create confusion over which vendors your team should use, how employees should book travel, what costs are covered on a company card, and how reimbursement works. Not only will this create organizational inefficiencies that drain time and resources; it can also take a toll on morale, as the demoralizing effects of not applying or understanding travel guidelines take hold.
And more pressing, employees who refuse to comply with corporate travel policies can cause costs to spiral out of control. The easiest way to earn employee compliance is to craft a policy they are willing to follow.
Here’s a breakdown of five key ways to get your employees to cut travel costs:
- Know Your Traveler
- Promote Your Policy
- Balance Savings and Satisfaction
- Create Incentives
- Insightful Reporting
By applying the following tips and strategies to your travel planning and management, you can help boost your compliance rates and secure your company’s bottom line. What’s more, you’ll spare your executive team and your business travelers the hassles and snafus of non-compliance.
1. Know Your Traveler
Before you can improve the travel experience, you need to get a clear read on what employee expectations, likes, and dislikes are when it comes to their business travel.
Travel managers in small businesses without a company system to capture employee feedback can use a free online survey tool like SurveyMonkey to gather employee input, or assemble employee focus groups where travelers can dialogue about experiences and preferences in person.
Be sure to solicit feedback on the policy you are implementing itself. If a guideline or explanation isn’t clear, chances are employees won’t follow it.
Remember that while you bear responsibility for ensuring that the policy is always clear, accessible, and up-to-date, employee feedback can help you prevent non-compliance.
2. Clarify Your Policy
To ensure compliance, clarity and awareness are key. Though 96% of people use a smartphone to accomplish tasks and get answers to questions, 54% of survey respondents say their company lacks guidelines for booking with suppliers via a mobile device.
Without clear, well-known guidelines, your employees are likely to follow their own behavioral patterns rather than your travel policy.
Review your policy on a regular basis to pinpoint errors, omissions, or oversights. A travel policy is hard to follow if it isn’t easy to understand. Simply clarifying guidelines, making corrections and updates, and filling in the gaps can help employees comply with your travel policy. In short, employee compliance with a crystal clear travel policy is a surefire way to protect your bottom line.
3. Balance Savings and Satisfaction
Cost savings are important, but they need to balanced against traveler satisfaction or efficiency – if a traveler arrives exhausted and frustrated, chances are lower for successful performance.
A travel policy that enshrines costs-savings as the sole priority cheapens the company’s relationship with the employee. Then the policy is in danger of being viewed as a way to enforce unpleasant restrictions rather than as a tool to empower employees to take control of their travel experience.
Describe clearly the specific kinds of added costs that are acceptable to expense back to the company – for instance you might consider approving lounge passes if they provide WiFi, seat upgrades if it makes a red eye bearable, and TSA PreCheck if it streamlines the traveler’s schedule.
Bear in mind that improving traveler service doesn’t necessarily mean increasing travel spend. According to the Association of Corporate Travel Executives (ACTE), 75% of survey respondents believe better traveler service improves compliance – and most of that cohort agree that higher costs aren’t needed to raise satisfaction levels, but building a relationship with your employee will.
4. Create Incentives
Creative approaches to compliance include gamification – a social gaming strategy – which includes reward points, online badges, and leaderboards to encourage and rank travelers according to their level of compliance. 41% of survey participants responded enthusiastically to the idea of turning business travel booking into a game, and an additional 32% would join in to be a team player.
What’s more, a whopping 70% of millennials expressed a keen interest in playing and winning. But given that 44% of frequent flyers would opt to avoid gamification and use the internet to select carriers according to their preference,3 flexibility on the part of the company and the employee may be key in incentivizing compliance.
Travel packages like those offered by Upside save businesses money, provide employees with savings and rewards, and present a variety of flexible options to help raise compliance rates.
Just look at Google’s internal Trips program, which rewards employees for saving. Google employees get a budget before every one of their business trips, and if they come in under budget, they earn personal credits to redeem on future travel upgrades. Like Upside, Googlers are motivated to save money today, so they can treat themselves tomorrow.
5. Insightful Reporting
Many organizations use a travel management company (TMC) and online booking tool (OBT) to facilitate booking trips and track compliance according to usage. The more employees who take advantage of these resources, the greater the level of compliance.
Others book on the open market (ex: Expedia.com or United.com), and consider a trip compliant as long as costs or fare classes stay within prescribed limits. (Survey results show that the majority of business travelers favor playing a role in planning their trips, with 47% of respondents expressing a preference for using their company’s online booking tool.)
Reporting for insights can encompass how much of a company’s travel spend is being accurately reported, the percentage of bookings made through official systems with approved vendors at negotiated rates, and forms of payment that follow protocol as verifiable expenses.
Traveler satisfaction is an insight that may be often overlooked but is no less important than the others. Modifying travel policy based on travelers’ needs and experiences can improve compliance. By making a travel policy more palatable, you encourage usage. Even the simplest guidance like incentivizing travelers to save company money through Upside perks and rewards–can make a world of a difference for everyone involved.
HIGHER COMPLIANCE STARTS WITH YOU
As the person who is responsible for mapping out a clear path to cost savings, you’ll find it beneficial to be vigilant in ensuring that the travel guidelines you set are understood and easy to follow. Ultimately, the journey to higher compliance rates starts with you.
Are you ready to save more money and get better reporting?
Visit Upside to discover how Upside can simplify your team’s business travel.