Skip to main content

Is your travel policy costing you money?

By 15 April 2016March 3rd, 2022News

When was the last time you went through your travel policy with your account manager?

Is your travel policy costing you money?Travel data is collated from many sources, leaving us with what’s known as fragmented data, or, ‘big data’. This ‘big data’ is complex and extremely fast growing, but why is it so important to travel management companies?

I perform annual health checks with all of my clients to test the effectiveness of their travel policy. According to GBTA (the Global Business Travel Association), an effective travel policy that is mandated and supported by senior management can save you over 20% on your overall travel expenses – imagine the impact this would have on your bottom line.

A good travel program should be measurable. In order to improve bottom line, you need to know how compliant your travellers are. The below three areas can be easily KPI’d and measured:

  1. Online Booking Tool (OBT) – Modifying booking behaviour by tailoring your online booking tool is imperative, and could save you hundreds of thousands of dollars a year.

There is no a one-size fits all approach to your online booking tool, and it honestly surprises me how many times I implement a new client and discover that their previous travel management company did not lock down their online booking tool to match their travel policy.

Yes, we can customise your online booking tool so that only restricted airfares or certain airlines can be booked, and yes we can change this depending on the user-role group. There are so many customisations that we can make to your online booking tool in order to drive desired behaviour.

Measurement: Percentage of bookings made through an online booking tool versus direct.

  1. Preferred supplier adherence – Your travel spend could be diluted by having too many suppliers or your staff booking where they want – outside of policy.

Where possible, it is recommended to have a select number of preferred suppliers, driving business to them and maximising volume discounts. It is crucial that the preferred supplier list is implemented through a successful communication process to all travellers and bookers.

I assist my clients with negotiations, benchmarking and implementing supplier discounts, as well as driving compliance to preferred suppliers internally.

Measurement: Percentage of bookings made through preferred suppliers and amount of times your preferred rate was available.

  1. Managing blind spend – We all know that blind spend exists. There are many reasons why rogue travellers bypass your nominated travel management company and book direct to suppliers.

More often than not they think they’re doing it for the good of the company, but the biggest impact this has on your program is weakened negotiating power with suppliers – untracked blind spend is directly costing your company hundreds of thousands of dollars in the form of missed supplier discounts.

I assist my clients with blind spend by assessing internal spend (from EMS) and implementing strategies for users who do go direct.

Measurement – EMS travel spend only 8%-10% more than travel management reports.

Ready to implement the right travel management strategy for your business? – Connect with CT Connections