Our previous article discussed how to organize and manage expenses as a business traveler. In the corporate landscape, however, the traveler is only part of the equation. As a manager overseeing employees that travel for your business, there’s a lot you can do to increase efficiency, decrease spending, and help both your employees and your business thrive. There are very clear financial and professional benefits to managing your employees’ travel well, so here are our top ten tips to maximize savings while also keeping your employees happy and productive.
1. Make Sure Your Travel Policy Is Transparent
Have a clear, transparent travel policy that keeps expense reports/reimbursement simple. We know, it sounds so easy: just have a good policy. But that’s often trickier than it sounds. A new study from the GTBA reveals that even though 79% of business travelers identify their company’s travel policy as having the greatest impact on their travel decisions, there is still a huge gap between when travellers are booking flights through the appropriate channels (63%) and when their employers think they’re booking in-policy (90%). Clearly there is a disconnect between managers effectively communicating their travel policy and their employees understanding said policy. So the first step is to go through your travel policy and make sure it’s clear, concise, and easy to understand. (Hint: if you fall asleep while reading it, your employees will too. And if you haven’t already, check out our guide to writing an effective travel policy or download our free travel policy template!) Once you’ve eliminated redundancies, send out an email blast with a copy of the new policy AND offer a series of meetings to brief your employees. That way, those who have questions have an opportunity to learn, and you get to clarify to your satisfaction. (You can also take note of who doesn’t show up, and then go over their expense report more carefully after their next business trip to make sure they read and understood company policy.)
If you want to help travelers follow policy and save the company money, create travel incentive programs. Employees understand the logic behind not overspending on a budget, but spending less than the budget doesn’t carry the same weight of consequence. I don’t know about you, but I don’t drive 25 miles per hour in the 35 mile-per-hour zone just because someone suggested it might be nice. Employees won’t expend the time and effort to spend less company money unless there is a real incentive to do so. You can take a few different approaches to incentivizing employees to come under budget:
a. Offer them cash back on the money they save.
A company like Rocketrip utilizes an algorithm to estimate average budgets for a given trip, and then offers ways for the traveler to come under that budget. Fifty percent of the money saved goes back to your business, and the other fifty percent is gifted to the employee as a cash reward.
b. Offer reward points or upgrades for future travel.
Dan Ruch, the founder and CEO of Rocketrip, cites Google as the “template for modern travel management.”Any Google employee that comes under budget for their business trip earns credits that they can use for upgrades on future travel. This model works, Ruch explains, because “Googlers are motivated to save today so they can splurge tomorrow.”
c. Make it a game.
Tap into your employees’ competitive streaks and establish a tournament of travel expenses, wherein the person who saves the most for their round of travel wins a prize and also advances to the finals at the end of the year (where you will of course dangle an awesome bit of bait). Gamification is an opportunity for good-natured competition and camaraderie, bringing together your employees as they reap the rewards of their frugalness while also working toward a common goal.
For more tips on incentivizing your employees to spend less on travel, check out our article on how to incentive travelers and boost policy compliance!
3. Consider offering specific examples as well as a travel per diem.
Old school domestic travel budgets might be designed around the GSA’s recommendation on travel per diem: how much a traveler can expect to reasonably spend on accommodation and meals per day during a trip, based on average prices in a given city or state. The problem, of course, is the use of the words “domestic” and “average,” which doesn’t really paint a clear picture for your employee of what he or she could reasonably spend for a three night stay in Phoenix vs. a five night stay in Paris. There are simply too many variables. Plus, it’s important to take duty of care into consideration and do more than just encourage accommodations at the cheapest hotel one can find in Paris’s 2nd arrondissement. To that end, include specifics in your travel policy that go beyond a numerical budget: economy vs. economy plus vs. business class; Holiday Inn vs. Marriott vs. Mandarin; Uber vs. taxi service vs. town car; Starbucks vs. The Palm vs. Mr. Chow. Where is it OK for employees to cut corners and where can they indulge a bit with a client? Give your employees specific direction so they know what’s reasonable and what isn’t.
4. Use a travel management company that offers services through mobile apps.
Booking, solving travel interruptions, expense reporting, monitoring travelers’ safety, etc.—your travel management company should be able to provide all of these services and more via mobile apps that you and your employees can access on the go. Mobile apps from Egencia, Concur, mTrip, and our own Claire all offer these business travel services. If you’ve been using the same travel management company for years and your service package hasn’t changed, it may be time for an upgrade.
5. Stay up to date.
Time marches on, and so must travel policy. It’s important that you regularly evaluate and update your travel policy in order to take advantages of emerging technologies and travel innovations that could help save your company money. Part of this responsibility lies with your travel management company, but don’t wait around for other people to make suggestions. Anyone could tell you that companies like Uber, Lyft, and Airbnb are changing the landscape for both business and personal travel, and that by expanding your employees’ travel options, you can reap savings. Even if you don’t want to allow these types of expenses within your travel policy, you should at least acknowledge them and explain to your employees why they should book a Hilton hotel room rather than an Airbnb condo. Again, transparency is key.
If you are considering to include the sharing economy into your corporate travel program, our article about the pros and cons of sharing options for business travel may be helpful.
6. Enforce a blanket “save everything” policy.
You, or at least your well-paid accountants, pay serious attention to all the information needed for tax deductions. Your employees likely do not. You could try to educate your employees on the various ways their expense information is used to write off business expenses and why the IRS absolutely needs a guestlist for that dinner party designed to court new clients, but that would probably lead to more confusion and bigger mistakes. Instead, create a blanket “save everything” policy that requires travelers ask for and keep hard copies of any and all receipts, tickets, passes, and other documents associated with their trip. Everything should be turned in with their expense report.
7. Conduct regular audits of management process and receipts.
Nobody is perfect; that’s why the IRS invented audits. Follow their example and conduct regular audits of your employees’ expense reports, keeping in mind the triangle of fraud (need, opportunity, ability to rationalize the action). Go a step further and conduct regular audits of your audits and other managerial procedures. It’s just as important for you to clean up the system and make sure required forms really should be required; employees get refunded in a timely manner; your HR manager isn’t in cahoots with your head accountant and robbing you blind…OK, that last one is unlikely, but you get the idea. You’ll never know what fell through the cracks until you shine the light and see what’s down there.
8. Fast pay makes fast friends.
Have a quick turnaround for travel expense reimbursement. Just as you would like your employees to turn in their expense reports as quickly as possible, your employees would also like to see their bank accounts reimbursed asap for the funds they spent traveling to Bangkok to woo that super important client into your company’s loving (metaphorical) arms.
Making sure the expense approval and reimbursement process goes quickly and smoothly helps keep company morale high and motivates your employees to execute their jobs efficiently. (You know, beyond the motivation their salary provides.) Plus, everyone knows time is money. Employees are more likely to submit on time if they know they’ll be reimbursed quickly, too. Efficiency plus saving money through extra time to work on the real aspects of their job. Sounds good to me, and it should to you, too.
9. Publically acknowledge travelers’ efforts.
Everyone desires recognition and praise. If you can’t afford monetary rewards, make sure to offer public commendation for your employees’ efforts on behalf of your company. This could be in the form of a regular email shout out or during a larger gathering, such as the end-of-the-year holiday party. Taking the time to recognize hard work pays off enormously in terms of employee productivity, loyalty, and longevity. Just make sure you’re being genuine in your appreciation. There’s no bigger turnoff than insincerity.
10. Be ready to listen.
Pay attention to employee feedback. Constructive criticism can be a tricky thing, but as most people looking to succeed will tell you, honest feedback is key to evaluating performance and accelerating improvement. Use an automated survey system that allows employees to anonymously (and we really do mean anonymously) express their criticisms of the current travel policy, reimbursement process, company transparency, etc.
Bonus tip: If your employee is flying internationally, allowing them to stay the weekend might be more cost effective than the business class airfare for the return trip during peak travel time. You can have them pay for accommodations themselves (see our article on the rise in bleisure travel), and that way, you’re saving money on the airfare while the traveler gets to appreciate a new experience in a new city (and perhaps build up some goodwill toward their company and employers). We call that a win.
Safari is a PhD candidate in English Literature. When she’s not grappling with her dissertation, she’s usually obsessing about upcoming films, singing karaoke, or attempting to perfect her short rib lasagna recipe.