Simon Ferguson: 4 ways to drive maximum travel performance

Go on…guess how much the world's employers spend on business travel a day. US$100m perhaps? Possibly even $1bn? Not even close. It's a cool $3bn. Yep, I had the same reaction.

With such a huge amount of money being spent, shouldn't buyers take a step back from time to time and see how they can improve the experience and get better value for every dollar spent?

Business travel is often thought of as solely a necessity for getting from one meeting to another, but it is far more than just a way of getting from A to B. It's a necessary part of an organisation's day-to-day functioning, helping drive the success of every business in the world and travel is common as a company's second largest overhead after wages.

With conservative estimates suggesting staff travel expenses account for around 10% of total company budgets, any booking inefficiencies are costly. In today's competitive marketplace, TMCs and corporates share common key objectives: the focus on controlling costs, driving growth and improving business performance — the return on trip.

Travel managers are under increasing pressure to satisfy traveller requirements while delivering against company travel objectives. Finding ways to maximise the return on trip while monitoring and eliminating unnecessary travel costs can make a big difference to a company's bottom line.

So, what is travel performance and how can travel managers drive it while controlling costs to maximise the return on a business trip?

1. Improving the business travel experience while maximising the return on trip in terms of productivity.

Like most sectors in our digital age, business travel is constantly adapting and evolving through technology to become more efficient. A constant influx of new technologies, such as wearables, artificial intelligence, bots and virtual reality, have all contributed to the creation of an 'experience culture' where everyone expects instant and engaging experiences.

While the modern business traveller does not belong to one particular age group, a new generation is pushing new habits and priorities. Millennials have already become some of the most frequent of business travellers and are pushing for mobile technology and greater flexibility in the world of business travel. With their demands and expectations, millennials are definitively changing what companies should expect from their travelling employees and demand from their organisation as an employee what they would expect as a consumer.

Adding personal travel to business travel also adds value to work assignments — which means that 'bleisure' could help improve the travel experience while increasing employee satisfaction and engagement without additional business costs. Fixing travel from the presentation to a palace or from a meeting to the mountains is becoming a more regular occurrence.

Technology is aiding increased connectivity which enables the travel manager to better manage the experience through automating communications. This arms travellers with the most up to date itinerary information. When considering the time spent between destinations, waiting to board planes, or sitting at hotels, this connectivity also enables the traveller to work on the go — making it possible to jump between business and personal — meaning the hours in between are no longer lost business hours or costs. It also ensures that duty of care is upheld at all times.

2. Enabling the business traveller to self-manage aspects of their own travel plans

Using company-preferred applications plays to the increasing desire by travellers to self-service aspects of a trip. If employees spend a lot of their time staring at their smartphones, travel managers must ensure travellers can manage their trip using mobile apps. Enabling employees to build their travel plans, have live agent chat and real-time alerts helps them stay connected while reducing call durations to TMCs. This boosts performance through automation, helping to realise significant cost savings associated with TMC fees.

If companies want to stand out from their competitors and meet the needs of the experience-led traveller, it is crucial that travel managers improve traveller experience by building this into travel policies. The traveller needs to understand the resources available. Businesses should have a clear policy in place around preferred suppliers and booking channels. Embracing this 'experience culture' presents a streamlined opportunity for travel managers to engage travelling employees in customised programmes and for companies to implement policies that take advantage of travellers being connected to encourage productivity.

3. Achieving savings that include getting the best value

Millennials are redefining business travel by travelling the most and doing it differently, but what does this mean for corporate travel programmes?

In a volatile buying environment, significant savings present themselves and disappear in a matter of hours. Convenience is one of the most-often cited reasons why business travellers book outside policy. And, with a smartphone in their pockets 24/7, there are many booking channels available at the tips of their fingers. This leads to an increase in out of policy bookings and further impacting any possible savings.

Corporate travel inefficiencies can be costly. 'Offline' bookings via an agent attract substantially higher TMC fees than bookings made using the online booking tool. A recent survey by Phocuswright says that fewer than 40% of business travellers booked via their company's recommended providers. Non-compliant bookings are causing a blowout in corporate travel costs and inefficiencies through wasted time and resources.

The traditional corporate travel process mainly focuses on the booking element rather than the entire end-to-end travel experience. It ignores a range of vital elements, including policy, approval, messaging, communication and duty of care. So an advanced travel management platform is vital. A seamless end-to-end corporate travel platform including; pre-trip communication, booking, authorisation, messaging, booking, cost-centre allocation etc. can all provide the right tools to empower the traveller to plan their travel. It also gives the right level of freedom to choose while prioritising options according to policy.

Every step travellers take generates huge amounts of data that offers visibility on your travel programme's performance. However, when these vast amounts of information come from very different sources, it's difficult and time-consuming to reconcile and consolidate information. Enabling everything to stay 100% within the platform regardless of whether self-service, agent service or a mix of the two allows the TMC service model to evolve and change from the old online/offline view. Efficiencies gained can be translated into lower TMC fees and savings for the corporation.

4. Exploiting integrated payment models to reduce time spent on reconciliation

Efficient global payments and the expenses and risks associated with foreign exchange payments remain a major challenge for many travel managers, potentially impacting the ability to cut costs. GBTA's Travel Manager 2020 report suggests "66% of travel managers expect alternative forms of payment technology to become a higher priority in the next 3-5 years."

As larger travel suppliers tend to maintain accounts in foreign currencies, many payment methods fail to provide visibility of exchange rates and fees before transactions. With the sheer cost associated with running multinational, multi-currency accounting operations, large companies can achieve cost savings by migrating to a single payment platform globally.

Virtual payments, which provide automated reconciliation and greater control, compliance and security, is another growth area for travel managers to consider. Each card has a virtually obtained number and includes an expiry date and CCV. Employees can only charge expenses to these cards for a specific date range. Once expired, booking data is automatically reconciled. Virtual cards also reduce time spent on reconciliation, are universally accepted and dramatically reduce the chances of fraud or cards being stolen or lost.

The changing face of corporate travel presents many challenges for travel managers, but they also present opportunities.

A seamless end-to-end corporate travel platform with a range of app-powered workflows for the "experience-first" traveller is the future of corporate travel. More travel choice, improved travel intelligence and better travel experiences help drive travel performance while making savings through efficiencies.

With that, we will all get a considerably bigger bang for our billions of bucks.