After more than a year of reductions in business travel, companies are now either increasing their travel volume or planning to do so. Increasing vaccination rates coupled with the reopening of states, regions, and countries have created an environment where organizations and their employees are more comfortable heading out on the road again. This is good news for companies, as many of them suffered financially through the Pandemic, due to a lack of demand for services and products, or because they weren’t traveling to meet with clients and prospective clients to close new business. To make the most of and to ensure a smooth transition to this new travel environment, optimizing a few travel program areas will help significantly.
Travel policies received a lot of attention during the Pandemic and that will continue for the foreseeable future. With so many changes in the travel industry over the last 15 months or so, there has been a heightened need for an up-to-date travel policy where organizational stakeholders and travelers can access relevant policy information in one place. For example, most organizations limited travel to what they deemed “essential” during the Pandemic and are gradually adding back “non-essential” travel, so it’s a good idea to keep employees updated with the types of travel that are open to them, and to make them aware if they need to seek approval before making a reservation with their travel management company (TMC). Preferred suppliers is another area that should be kept updated, as they’ve changed for many organizations over the course of the Pandemic. Cleanliness standards played a large part in that over the course of the Pandemic and now, with travel volumes increasing for companies, they need to be certain that their preferred hotels, for example, have the staffing to support their travelers or that their preferred rental car companies will have cars available. Updated, relevant, and readily accessible information is key during these times.
It’s no surprise that travel risk management is now a company-wide focus that includes executives, the travel manager, security team, and human resources. The Pandemic set a precedent for how emergency travel situations should be handled and mitigated, when possible. Not too long ago, organizations may have been content with knowing where their employees were traveling to, so they could cross reference that information in the event of an emergency to learn if their travelers had been affected. The Pandemic, however, hastened the direction in which travel risk management had been moving in the last several years, which is the ability to proactively mitigate risks in an efficient manner. When the travel bans were announced, some organizations had to scramble to get employees home, cross referencing spreadsheets, figuring out the best way to communicate with their travelers, and attempting to understand various governments’ travel restrictions. It was a chaotic time for many companies. There were some organizations, however, that fared better. Larger companies have traditionally led with online, automated travel risk management solutions and those proved invaluable when travel was shut down. Through a single platform, they were able to communicate with all traveling employees and facilitate travel home through their TMC. The Pandemic highlighted the utility of using travel risk management solutions like this, as well as set the precedent for ensuring companies have the ability to mitigate travel risks proactively. Addressing how travel risks are mitigated should be a priority for companies moving forward.
Managing the travel budget is also a major consideration for several reasons. Finance teams realized savings in 2020 from the lack of travel, but they also forfeited some top line revenue from not meeting with clients and prospective clients. According to the popular study, The Return on Investment of U.S. Business Travel by Oxford Economics USA, for every dollar spent on business travel, companies realize $12.50 in incremental revenue. Finance executives are well aware of this. They know costs will increase from the rise in travel, but they don’t want to overpay for the travel. As travel volumes increase, there should be an effort to ensure that all travel is on the grid – this is the first step. This will help companies drive top line revenue, but also control travel costs at the same time. When reservations are made through the TMC channel, it allows finance teams to see if preferred vendors are being used, thereby increasing their spend leverage. This also gives travelers access to TMC air, car, and hotel discounts, and provides data on booking behavior, such as advance purchase, and more. These are just a few ways to control the travel budget as travel volumes increase, thereby ensuring more of the increased top line revenue makes its way to the bottom line.
The Pandemic brought business travel to the forefront of corporate priorities and it appears that positive changes will come from this. Where support in some organizations may have been lacking in the past for travel program initiatives around risk mitigation, efficient processes, and cost controls, there now appears to be company-wide acknowledgement of the importance of corporate travel and the need to “get it right.” If you would like to discuss how to optimize your travel program for the new travel landscape, please reach out to us at Travel Leaders / Destinations Unlimited.