From the good old days to tougher times
In the 90s, it is fair to say that business travellers had a relatively free rein on how they travelled and where they stayed. Times were good and the commercial focus was on the trip outcome. Self-booking tools were starting to emerge amongst companies with more sophisticated IT infrastructures, but travel restrictions were generally minimal. The bright dawn of a new millennium was soon to darken with a global financial crisis post-2008, and this was to change the way we travel and the role of the travel manager forever.
Travel costs are substantial and must be managed
‘Unmanaged travel’ became ‘managed’ as employees were instructed which travel suppliers they should use and how bookings must be made. This brought about a new phenomenon: widespread implementation of corporate travel programmes driven by set travel rules. With travel and entertainment (T&E) making up such a huge part of companies’ direct operational costs, the stakes in managing the T&E budget are exceptionally high. Take the top 5 Western European markets (Germany, UK, France, Italy and Spain) which in 2011 spent almost 140 billion € on business travel(1). And with ‘super-users’ accounting for almost 20% of employees and yet spending 80% of the T&E budget(1), policy compliance amongst this group is essential if corporations are to have any chance of containing travel costs. Online booking tools such as Amadeus e-Travel Management have a vital role to play in facilitating travel search and booking within policy parameters. With a single point of entry to multi-modal content, pre-programmed ‘quick trips’ and full data integration with management information systems, OBTs have made it easier for travel managers to optimise and control business travel procurement.
It’s time to take control!
Recent research studies indicate that improving travel-expense management is a key priority for corporations: 42% of finance executives stated their companies will focus on optimising the level of control over travel-related spending over the next two years (2).
From speaking regularly with professionals from Procurement, Finance, IT and from the travel management department, my top recommendations on taking more control over your corporate travel spend are definitely in line with the outcome of the study:
- provide strong visibility of your travel programme to employees and the need for enforcement
- obtain buy-in from your 20/80 ‘super-users’
- maximise OBT adoption (training, data integration, post-trip analysis)
- maintain strong supplier relationships to achieve ongoing discounts
- enforce strict compliance of travel programmes and closely monitor any ‘leakage’
We invite you to read the White Paper “Corporate Travel Management in Western Europe – Opportunities and Challenges” which provides an in-depth analysis on how corporations can achieve T&E cost savings of up to 23%.
(1) Corporate Travel Management in Western Europe: Opportunities and Challenges – March 2013
(2) Improving Control of Travel Spend: CFO Research in collaboration with SAP – March 2013