Essential Guide to Business Travel Policy
Most organisations of a certain size will already have a business travel policy. Yet despite the obvious benefits, some recent evidence suggests that many SMEs still don’t have a travel policy in place.
But what should a sound travel policy cover, and just how detailed does it need to be? Let’s start by asking why you actually need one in the first place.
Why do you need a Travel Policy?
A comprehensive travel policy helps you control costs and provide employees with a clear set of guidelines which sets out a fair and consistent approach to travel expenditure.
As with all things in business, it’s worth doing some serious, joined-up thinking at the outset to determine exactly what you’re trying to achieve with your policy.
Key Things to Consider
A sound policy will include both directives and procedures, so it functions as both a rulebook and an instruction manual. A policy needs to be robust, but with enough flexibility to allow for the reality of your operational needs.
It’s worth considering factors such as whether you need a travel agency on site, whether you plan to use multiple suppliers and if it should cover your employees’ leisure travel.
With travel budgets increasingly squeezed, some analysts are suggesting that you should allocate costs to everyday business meetings and consider the role of teleconferencing for certain types of meetings like staff interviews and catch up meetings.
On a related note, this article makes a convincing case for having dedicated female-friendly travel policies.
What should your Travel Policy cover?
A sensibly drafted, comprehensive travel policy shows your staff know where the parameters are, and hopefully avoids any discrepancies over travel spend.
At the minimum, we would advise that your business travel policy covers the following:
¹ awareness of, and compliance with, spend restrictions
¹ wastage and budget cost efficiency
¹ purchasing leverage with selected suppliers
¹ maintaining supplier effectiveness
¹ enabling simpler valuation of tax and National Insurance contribution issues
¹ highlighting significant cost saving potential by streamlining the payment, reporting and reconciliation processes
A good policy might encourage staff to book as early as possible to take advantage of savings and make it mandatory for staff to submit a ‘reasoning code’ to justify any bookings made at a later stage.
Keep it Clear
Keeping things clear, concise and to the point greatly improves the likelihood of your staff actually reading, noting and understanding your travel policy, which also gives staff little excuse should they fail to comply with it.
Allowing for Flex
Circumstances can and do change rapidly, particularly in our uncertain world, so it pays to have a flexible system with enough built in agility to accommodate a change of plan on the hop.
Detail is everything. You may have a rule for instance that allows staff to upgrade to premium economy only if they’re travelling on a long haul flight over 6 hours. Equally we know that hotel prices vary from city to city, so instead of a blanket ceiling for an allowable cost of a hotel night, an intelligent travel policy will factor this in and set limits for each of your key cities.
Similarly, you might set a rule which allows staff to book a rail ticket that’s fixed on the way out but with an open return, to ensure you don’t overspend. If you have a corporate airline or hotel loyalty points scheme, policies need to be agile enough to include these and help you accumulate points used against future spend.
Is your Travel Policy Bleisure-proof?
As we’ve said before, ‘bleisure’ is one travel trend that’s definitely on the rise. More business travellers are wisely deciding to extend their business trip, save on flights and tag on a few days of leisure travel to their business trip, and perhaps also travel with a partner.
Separation from loved ones has been identified as a key cause of business travel stress so it stands to reason that perpetual business travellers will want to travel occasionally with a partner.
Do your policies allow for this and where exactly do you draw the line on your duty of care, does it extend to their travelling companions?
So once have a travel policy in place, is that where it ends? In fact, it’s just the beginning. Establishing a cohesive travel policy is the first essential step in controlling your travel expenditure while maximising its value.
We can guide you here by conducting regular reviews helping you get an accurate picture of matters such as how your spend matches up with your travel budget, and identify areas where we can identify clear cost savings, tightening your policy as a result. As your trusted TMC, it’s our job to check that your policy is being implemented effectively and review where necessary, usually on a quarterly basis. We’ll ensure we don’t take any bookings that fall outside of your policy and advise on potential cost savings.
Of course travel is a fast evolving industry so the odds are that you will need to update it sooner than you think. With that in mind, here are a few travel policy trends which we think you may want to keep tabs on.
Green Means Go: Travel Policy Solutions
Here at CTM we know just how complex business travel policy management can be. That’s why our systems have been designed to streamline things for you.
This is where our leading edge travel booking technology comes in. Our custom booking software keeps things easy for your staff using our simple ‘traffic light system.’
When your staff are searching for hotels or flights there’ll see one of three indicators beside each search result.
If it’s red it means it’s outside of their travel policy
If it’s yellow it might be bookable, but it needs manual authorisation
And if it’s green it means it’s fine to book and good to go!
Bespoke Systems for Travel Policies
We know that one size rarely fits all and so we can always tailor our software further according to your needs. Clients can, for instance, opt to simply have it set up so that their bookers can only see deals which fall within their existing travel policy and a variety of authorisation processes can easily be applied to different departments, user groups or individuals, depending on your individual needs.
If you’re looking for a detailed guide to drafting a travel policy CTM can assist you. We have years of experience and can advise on all elements, from drafting a basic policy, through to more complex policies geared around the objectives of a fully expensed process. Get in touch today to see the difference we can make.