Lower travel costs through compliancy!

The costs of corporate travel are ballooning while budgets remain almost the same. Which changes can you implement to save money without compromising the goal of corporate travel? We will take a closer look at compliance in this blog post.

Failing to enforce a travel policy can be very costly to companies. 10% of total corporate travel costs could be saved if travellers complied with an additional 5% of existing travel agreements. Increasing compliance with travel policies is therefore a very interesting method of reducing the cost of corporate travel. Why do travellers not comply with the travel policy and what can you do to ensure that they do?

Why are they non-compliant?

The most important reasons why corporate travel is not booked in accordance with the policy are:

  1. Last-minute bookings (78%)
  2. Unfamiliarity with the policy or lack of awareness of the consequences on the traveller's part (69%)
  3. Use of personal loyalty programmes (54%)

In addition to these three important reasons, travellers are sometimes unhappy with the compensation they receive for expenses incurred for corporate travel. Regardless of the reason being used, communication and education are essential elements in ensuring better compliance with the travel policy. 

Increase compliance with communication

What happens when a traveller does not comply with the travel policy? Are certain measures taken? Is the traveller disciplined? Research shows that almost half of travellers think that failure to comply with the travel policy will have no consequences. It is therefore important to always communicate with both compliant and non-compliant travellers to inform them of the consequences of non-compliance with the travel policy. Encourage travellers to report when they encounter issues that would complicate their compliance with the travel policy during corporate travel. For example, consider when car rental companies offer a more expensive car at the desk compared with the one that was reserved. Such situations can be processed in the booking system. 

To actively involve travellers in compliancy with the travel policy you must appoint someone in the company to oversee travel policy compliance. You can appoint a Compliance Coordinator and assign them the task of discussing this topic with travellers and to check if travellers are fully compliant your travel policy.

Check the corporate travel plans before departure

Most companies discover cases of non-compliance after the corporate travel has taken place. The costs are revealed in monthly reports, during the financial settlement of the corporate travel or even when processing the claims. To ensure that corporate travel is arranged as specified in the travel policy, it is essential that any corporate travel plans submitted are verified at an earlier stage. That is why you should include checks throughout the booking process during which authorized employees, such as the Compliance Coordinator or a Travel Management Company agent, verify whether the corporate travel was booked as specified in the travel policy. These ‘pre-trip approvals’ are an essential step in ensuring that the costs of the corporate travel remain manageable. 

Reward loyal travellers

A sensitive point in encouraging compliancy is rewarding travellers who comply with the travel policy. Few companies are enthusiastic about rewarding their travellers for complying with the rules, but it does work. 

You can reward travellers in a variety of ways, such as introducing a loyalty programme that enables travellers to collect points for complying with the travel policy. You can add a game element by making a leader board of who saved the most money. Another example is giving travellers a discount on products related to travel. Regardless of the option you choose, rewarding travellers helps to raise their awareness of the importance of compliance with the travel policy.

From baby boomers to millennials

A final point that will become increasingly important in the next few years is the generational divide. Baby boomers use different means of communication and have different wants and needs during corporate travel compared with millennials. It is essential to take these different groups into account when writing your travel policy. To encourage greater compliance with the travel policy, different choices will need to be made depending on the generation you wish to encourage that behaviour in.

Reducing expenses with compliancy

As has been mentioned, travel expenses can be significantly reduced if travellers comply with the travel policy. The costs of corporate travel can be reduced in the following ways:

  • Increasing communication with travellers
  • Checking travel plans before departure
  • Evaluating corporate travel after the fact and adapting the policy where necessary
  • Rewarding travellers’ good behaviour.

For more information on increasing travel policy compliancy or advice on your travel policy, contact us today!

 

Source:
‘Customer Compliance, Encouraging employees to be compliant’, Travel and Transport
‘Violation of the corporate travel policy’, Anneli Douglas en Berendien A. Lubbe 
 

Ivo Dusch
Ivo Dusch
Result Manager
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