Several years ago, in my previous life working for a global corporate travel agency, I was reading the transcript of a panel discussion from one of our client forums. I was struck by something I read there – one of those things that is so obvious and so fundamental that I hadn’t acknowledged it before: companies travel to generate revenue.
One of the participants on that client panel was the travel manager for a large automaker. Every time – and I mean Every. Single. Time. – we asked him what he expected from his travel suppliers to improve his program he said, “Help me sell more cars.” At first, I chuckled to myself. But the more I thought about his response, the more apparent the fundamental truth became. The ultimate, overarching corporate objective of each trip, at least indirectly, is to get a Return on the Investment of travel, even if was not a sales call.
Now, I think pretty much every company – no matter the size, industry, geographic scale, or market capitalization – would agree that maximizing the ratio of a Return on an Investment (the ROI) is a good thing. That can be done in one of two (obvious) ways:
- Increase the Return and/or
- Decrease the Investment
A Traditional Managed Travel program is tasked with the latter.
We’ve all heard the truism, “If you can’t measure it, you can’t manage it.”
Managing travel is all about data. With data:
- Travel managers can identify trends, and control and reduce spend – most commonly by negotiating volume discounts with suppliers and/or educating travelers on how to make smarter buying decisions.
- Service levels can be tracked and monitored to ensure travelers are getting the support they need.
- Corporations can meet their Duty of Care obligations and design a sustainable travel program.
Perhaps I should add a qualifier here: “complete.” Without complete data, obviously, only part of the travel program can be effectively managed.
So, how do travel managers make sure they’re getting complete data?
Generally speaking, many of them formalize a travel policy – a set of guidelines, processes and procedures governing how and where travel should be booked, acceptable types and levels of spend, and other expected behaviors – which they require their travelers to follow. Then, many partner with a Travel Management Company (TMC) and with other “preferred” vendors who promise to provide complete data. They also leverage technology in the form of corporate travel online booking tools, which can capture data from each reservation that is booked. There are many, many other things travel managers do, but at a high-level these are the most common ones.
So, how effective are those efforts?
As long as the traveler follows the policy, uses the TMC and/or online booking tool, and chooses the preferred suppliers, the program works pretty well. When, for legitimate or illegitimate reasons, travelers don’t do those things; however, the system breaks down, and gaps begin to appear in the data – it becomes incomplete. And as travel managers know better than anyone, CFOs typically don’t accept excuses about not being able to get complete data.
So, at the end of the day, every travel manager – or anyone in the company who is responsible for the travel budget – is essentially faced with answering these questions:
- How do you measure and maximize the ROI of your company’s travel?
- What have you put in place to help you gather the data you need?
- What successes or challenges have you had with your travelers in using what you’ve put in place?
- Are you getting all the data you need?
Travel managers have a choice to make. They can make do with the data they have. Or, they can look to companies like Concur to help them consolidate the data that doesn’t flow through the traditional channels. It’s the latter, however, that will help both companies and CFOs understand the success of their travel program to generate revenue.
Learn more about how Open Booking can help your Managed Travel Program and get complete data.
Photo credit: Bill Morrow