5 Tips to Reduce Your Employees Travel Expenses
Different people have different mentalities about business travel. For some, it’s worth paying any amount for. If your people need to travel, the purpose of the trip is more important than the expense, right? Others (us included) see business travel as a treasure chest. Travel is a controllable expense, and a huge one at that. Exerting a little more control is all it takes to unlock that treasure chest, and all without impacting your travellers’ ability to do their jobs successfully. Here are five key tips to consider when trying to cut down employee travel expenses.
Tip 1: Do the things everyone has already told you.
Anybody who knows anything about corporate travel will tell you that consolidating travel spending is absolutely crucial. Without a structured travel program, employees are liable to do anything and everything under the sun, from booking or changing their arrangements last-minute, choosing more expensive vendors or classes of service, and ignoring deals at preferred hotels. This means reconciliation is a mess of stapled receipts that takes weeks to sort through. Worse, it means, if something goes wrong, you’ll have totally failed your duty of care responsibilities to your travellers, and that you’ll be held financially culpable. Consolidate your travel, enact a travel and expense policy, and consider partnering up with a travel management company to handle the logistics. Not only will you save money, but your people will waste less of their working day on travel minutia.
Tip 2: Reduce friction however you can.
Maybe the first tip came across as obvious, and you’ve already taken some of those measures. Don’t worry, there’s always more work to be done. Reducing friction entails examining the elements of your existing business travel process and identifying weak points. For instance, does your current process for submitting receipts require travellers hold onto them and hand them over physically? What about an expense app that allows travellers to scan them with their phone cameras instead? Suddenly, you’ll have a lot less trouble with lost and missing receipts. Is your travel policy full of overly wordy jargon? Consider rewording it to be simpler, cleaner, and more readable (some travel management companies even offer policy editing as a service). Now you’ll have fewer travellers saying they booked out of policy due to its complexity or inaccessibility. Every way you find to reduce friction just means more money in your pocket.
Tip 3: Build a culture of ownership.
Some corporate travel solutions reward employees just for complying to policy. Isn’t that a little backwards? Employees aren’t usually given special compensation for doing what’s expected of them. Instead, why not try and create an environment where employees want to comply because it’s the right thing to do? This might be more feasible for smaller companies, where execs brush shoulders with everyone else, and employees are more likely to feel personal responsibility, but no matter the scale, the key here is bringing compliance into the conversation. Propagate training material and best practices, share compliance updates and highlight top performers in team meetings, and talk to outliers without judgement about their travel experiences. It’s a lot more important to identify and gauge the motivators behind non-compliance than to chew out misbehaving travellers. Noncompliance can be based on a misconception or miscommunication which can easily be set right. After talking and listening, you might just find that your people will start to take personal ownership for their business travel decision-making.
Tip 4: Really understand your expenses.
Making sense of your travel spend shouldn’t feel like looking into a black box, and being unmanaged generally won’t help to alleviate that feeling. Even managed companies with access to spend reporting might end up feeling the black box sensation. The reason: not all reporting is intuitive. Intuitive reporting should equip you with visibility over every aspect of your travel program. For instance, it’s not enough to know only how much your entire company spent on airfare. You should be able to view spending by cost centre, down to the individual traveller. You should be able to see the average fare cost, the most common routes, and the purpose of travel. You should have access to information and statistics related to outliers and exceptions, and analysis of any patterns that might be developing among them. Most of all, your spend reporting should not merely entail a PDF at the end of the year, but rather should include advice and active involvement from your travel partner to identify and address areas for improvement, including alternatives to services, vendors, and policies, comparisons to industry trend, and more. You’re working with them to leverage their industry expertise. Make sure you’re getting your money’s worth.
Tip 5: Think practical.
This one is a bit hard to pin down, but sometimes cutting cost is just that contextual. A particular detail could result in significant savings. For example, your corporate credit cards may include air miles, meaning you have a whole new element to consider for your travel program. You might study your travel patterns and come to realize that your internal meetings are often held on peak travel days, or that team retreats are held during peak season, and that shifting them is enough to make a big difference. Thinking this way is a tall order; it requires considering the big picture and the little details at the same time. Thing is, a good travel partner will be there to help you pick out these practical saving opportunities. Some travel management companies will, for instance, consult you on payment solutions that accrue air miles, and even help track their use.
To put it briefly, travel is a largely untapped resource, and while tackling it can be a project, it’s certainly one worth undertaking. Whether it’s by making processes smoother, gaining higher visibility on your spend, or stimulating a more responsible workplace culture, you’ll not only be saving money on travel, but developing attitudes which should improve the company as a whole.
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