The MacNair Travel Leadership Blog

Symptoms of an Unhealthy Travel Management Approach

Posted by Mike MacNair on Jul 30, 2015 3:00:00 PM

Screen_Shot_2015-07-13_at_11.54.47_AMHow do you know if your travel management approach is unhealthy? What are the symptoms that would cause you to take notice and consider re-engineering your approach? After all, Travel and Entertainment (T&E) is widely considered to be the second largest controllable cost for most organizations. Yet many organizations do not think about business process re-engineering (BPR) for T&E because they do not recognize the symptoms of an unhealthy approach. Who is going to complain about getting whatever they think is best until they see how much that could be costing the company or, worse, they get stuck and can’t find help or support?

Many organizations with an unhealthy travel management approach haven’t practiced any travel management wellness tactics and many times come to our industry only after the equivalent of a travel management heart attack. Good business process re-engineering helps organizations fundamentally re-think how they do work in order to dramatically improve service, improve savings, enhance productivity, gain control and be more competitive. The symptoms an organization that needs BPR in the realm of T&E experiences come in four categories. They are unpredictability, waste, inefficiencies, and liabilities. Specific symptoms may include:

Unpredictability

  • Costs associated with the most popular T&E categories – air, hotel, car, meals and parking - cannot easily be determined.
  • The organization is not able to use the cost data defined above to benchmark and evaluate the results.
  • Costs by traveler in these categories cannot easily be compared either using your managed system or those outside your system.
  • Data is not available, by project or department, for managers to use to prepare and supervise budgets.
  • The data required to allow department or project leaders to manage budgets and identify budget busters is not available.

Waste

  • Paying higher than average airfare, hotel and car rental costs than reasonable benchmarks in targeted areas.
  • Methods are not in place to help the people managing travel understand why fares other than the lowest available were selected. 
  • Consistently late booking trends can make trip costs higher and are hard to determine and discourage. 
  • Lack of confidence that all options from all suppliers are being considered via the booking sources used. 
  • Team interprets what the best value is in a variety of ways causing waste and debate.
  • Since the best value is interpreted in a wide variety of ways, thresholds aren’t in place and enforcement is difficult.
  • A mechanism for enforcing policy yet considering reasonable exceptions isn’t in place and either wastes money, time or both.
  • Lack of a clear policy on hotel expectations leaves money on the table.
  • A clear policy on car rental expectations isn’t in place (addressing insurance is a biggest example) and wastes costs.
  • Preferred supplier opportunities either aren’t in place because opportunities aren’t clear or they aren’t fully leveraged in a clearly enforceable way.
  • Credit card/payment system benefits aren’t leveraged for the organization as consolidation isn’t considered.

Inefficiencies 

  • The time to look, book, change, and expense a trip isn’t considered in directing travelers to the most efficient overall business process creating inefficiencies at various stages.
  • Disruption management varies by booking platform and isn’t considered when directing travelers to the best practice.
  • Complicated requests (international, multi-leg, VIP, special services) can eat up a great deal of time unless directed to the right platform.
  • Securing data, credit card reconciliation, determining budget codes and other financial requirements can be inefficiently handled without considering the opportunities of consolidated data and data management platforms in the T&E system.
  • Inefficient payment systems can waste back office time impeding cash flow.

Liabilities

  • The organization is unable to easily find all traveling employees at any given time and emergency systems are not in place.
  • There is a lack of compliance to federal and state laws, customer/contract requirements, and more.
  • There are data security issues in open booking systems.
  • Policies are not in place to direct travelers away from insecure suppliers that can turn into a personal safety issue.

How sick do you feel? If your organization has many of these symptoms, the next step is to share them and quantify them with a TMC or outsourced provider that that can clearly help identify and analyze your current processes. Some TMCs have such consulting services separate from their account management process, and some have this effort built into their overall program. An educated consumer can secure the best results. Leverage the right tools for the right results.  

Travel-Management-Diagnostic-Scorecard