Business travel pivots: From leakage to leverage

The pandemic brought multiple facets of the employee experience into focus. Hybrid working styles became the norm. Technology jumped forward to power a new style of collaboration. We got used to bringing our whole selves – and our kids and pets – to meetings. The buildings we are returning to have been redesigned, with fewer cubicles and boardrooms and more open spaces and meeting places. Corporate policies have had a radical rethink post COVID.

Yet, while companies are redefining workplace experiences and implementing new collaboration tools, business travel has not evolved for modern teams, leading to revenue leakage from employees not sticking to their employers’ travel platforms.

Multiple studies show that between 31% to 53% of workers still book travel on the platform of their choice. Aside from the inability of a company to offer the appropriate duty of care to employees by knowing where they are, this well-documented breach of policy has created a significant problem for finance managers for decades. Without discounted rates, expenditure tracking and the ability to see travel data and trends over time, leakage increases the chances of employees booking out of compliance, let alone the potential to cost businesses thousands.

So if other corporate policies have been rewritten to fit the post-pandemic work style, why are travel managers still struggling to modernize their approach to travel?

Rebuilding travel from the ground up

Offices, utilities, technology, financial services, benefits and travel were once thought of as essential workplace infrastructure. Today, they are essential workplace services. People don’t merely expect those services to work – they expect them to surprise and delight, using technology enabled by artificial intelligence to preempt a worker’s needs while flexing to fit the work styles in the company globally, in their local currency and culture.

Travel, for most organizations, has mostly been an exercise in forecasting and budgeting. “How much do we need to spend on travel to make a multiple of that amount in sales?” ask the business leaders. “What percentage of our revenue can we carve out for travel expenses before it negatively impacts the bottom line? Who will give us the best travel deals?”

Employees want mobile tools from a responsible employer that make it easy for them to book their business travel and not miss out on the best deals or loyalty programs. When the business doesn’t give them what they want, they go outside the travel policy, causing a drop in compliance and eventual revenue leakage. 

When employees book direct or via their preferred third-party site, the problems created for business managers compound quickly. For one, it’s impossible to control the way people travel – not just the overall cost, but the cabin class, dates, extras and add-ons all become invisible and uncontrollable. Once the trip is complete, it can take time to even see the expense show up. At best, it’s at month-end. At worst, it’ll be whenever the employee does their expenses and the reimbursement request comes in.

The result of these two competing expectations – the finance leader wanting to budget better and the employee wanting a more delightful experience – can create dissonance and non-compliance. What if modern solutions could keep both sides happy?

Time to stop and think

In the second half of the year, corporate leaders start budgeting for the following year and there is a ton of (sometimes contradictory) data to consider when looking at their travel policies. They will begin to forecast and make investments in travel to achieve business goals while also accounting for anticipated leakage. If that’s what you’re about to do, I recommend you consider the below:  

• Build a modern employee experience. Treat your travel the same way as your workplace. Remember, people aren’t just moving from office to office when they travel – they’re working from the sky, the road and the hotel room. We spent so long thinking and rethinking workplaces, so let’s do the same for travel – collaborate with your human resources team to poll people. Ask questions that include space for anecdotal feedback and preferences. Think of travel as a service that needs to be designed to empower employees, not just a line in the budget that must be minimized.
• Create a hybrid tech stack. Look at your travel policy in the context of your technology choices. Consider solutions that can integrate the booking experience into your existing platforms and tools to manage travel spend. Look at the apps and sites people use, both at work and at home (not just for travel!), and think about how your employee experience can match their favorites. Make decisions on how to use new technology to drive greater employee productivity and satisfaction when they travel – from searching through booking and traveling to the automation of expenses. Are you using next-generation tools across the board, with open APIs and predictive AI, to make the experience feel bespoke and the process frictionless? Is that having a positive impact on usage over time, therefore reducing non-compliance?
• Make it easy for everyone to do the right thing. Chief financial officers want their managers focused on strategic work, not chasing down employees over policy violations. You can drive higher compliance in a travel platform by cutting down on the need for policing or troubleshooting by the finance team. Tech will let you do much more than automatically keep people compliant – it can use AI to ensure suggestions are the best value and personalized, while expense filing and reimbursement is fast and automated. Letting technology do the work not only improves the experience for employees, it can boost financial efficiency too. 

Best of both worlds

Non-compliance with travel policy can have a big impact on a company’s bottom line. And as expectations from employees continue to go up, it’s time to rethink your travel policy with both the employee and manager experiences in mind. Economic headwinds and technological leaps continue to demand that companies become more efficient and optimize spend without sacrificing productivity or speed of innovation. 

To all leaders concerned about managing travel spend, I encourage you to think about preventing leakage through multiple lenses. Use the lessons the pandemic taught us. Keep modernizing the workplace. Test and learn through regular communication with your employees to show you take your duty of care seriously. Rethink the tech stack through the employee and manager experience.

By making things seamless and integrated, you’ll find that – even though your destination is efficiency and compliance – people will be much more likely to go on the journey with you.