Study: Travel Policies Work, And Will Continue To Do So - Business Travel News

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Study: Travel Policies Work, And Will Continue To Do So

December 05, 2012 - 01:25 PM ET

By David Jonas

Most travel managers "believe their travel policy is effective today and will be equally effective two years from now" and that "if they are going to make changes, it will be to make the policy tougher, not more relaxed," according to a new study by the Association of Corporate Travel Executives and AirPlus. The organizations conducted the study, released this week and based on an August survey of 305 ACTE buyer members, to gauge the perceived impact—or lack thereof—of trends some say will threaten travel policy compliance.

Delving into dialogue on the so-called Travel Management 2.0 philosophy, the report's authors wrote that "according to this theory, mobile technology and social media will make young, tech-savvy employees ignore the company travel program to book trips through websites and tools of their own choosing." Collected from buyers located predominantly in North America and Europe, the survey results do not support that theory.

"In spite of all that has been said and written," the authors wrote, travel buyers "see few signs of employee resistance. Far more buyers expect to add more rules to their policy than those who expect to reduce the number of rules."

But survey results also suggest that preferred methods for improving policy compliance are "less authoritarian," focusing instead on communicating policy benefits.

When asked about current policy compliance within their organizations, 14 percent of all respondents stated dissatisfaction and an additional 1 percent said they were "very dissatisfied." Among those at organizations spending more than $100 million annually on travel, 6 percent were either dissatisfied or very dissatisfied. Overall, 53 percent of respondents said their organizations have enjoyed improving compliance during the past two years, while 8 percent were plagued by deteriorating compliance levels. Moreover, 48 percent said they expect further compliance improvements during the next two years versus 15 percent who expect lower compliance.

Looking specifically at the impact of mobile technology and social media, however, 15 percent of respondents said such developments already have made travelers less compliant. Another 26 percent expect compliance to suffer as a result. On the flip side, 27 percent of those surveyed said they expect mobile technology and social media to improve compliance.

To further improve employee adherence to policies, 32 percent said they anticipate "more rules" in two years while 8 percent said they expect fewer rules.

When asked how their organizations may seek to boost compliance among six presented options, 43 percent indicated "punishing noncompliance more heavily," followed by "making more rules/mandating recommended rules" (38 percent); providing more flexibility in terms of suppliers (36 percent) and booking channels (25 percent); switching certain policy elements to recommended from mandatory (18 percent); and providing payment method flexibility (7 percent). "All the options suggested for liberalizing policy receive less support," researchers concluded.

Buyers also were asked to note their own ideas for improving compliance. "Most suggestions were neither revolutionary nor authoritarian but intended to make existing policy more effective in a non-disciplinarian way," according to the report.

"It has been suggested that in the future, the only policy rule will be that spend per trip must be within a set budget," the authors added. "Given the overwhelmingly conservative views expressed so far, one might expect this idea to be dismissed by survey respondents, but in fact their opinions are mixed. While 43 percent believe the proposal would push up overall costs, 34 percent think it would make no difference, while 23 percent expect overall costs would fall."

Meanwhile, "communicative actions are much more common than directly punitive actions" in response to policy noncompliance, according to the ACTE/AirPlus report. The two most-cited actions, each indicated by 58 percent of respondents, were warning travelers before their trips of any noncompliant behavior and informing line managers. Twenty-six percent of respondents said their organizations "refuse to reimburse noncompliant spend," while 15 percent "block noncompliant bookings."

"Big spenders are much more likely to block bookings ... but smaller spenders are more likely to refuse reimbursement," according to researchers. Among all respondents, 3 percent indicated their organizations "take no action against travelers who fail to comply with policy."

Transatlantic Discrepancies 

The study revealed disparities between policies used by represented organizations headquartered in Europe (accounting for 25 percent of the survey base) and those headquartered in North America (61 percent of the survey base). For example, pre-trip approval is more popular among represented companies in Europe, used by 59 percent of those covered in the survey compared with 47 percent among those representing North American companies. European respondents also were more likely than their North American counterparts to indicate the use of price caps in each city (54 percent versus 35 percent) and more likely to require travelers to consider or actually book such travel alternatives as remote conferencing (66 percent versus 50 percent). The balance tilts in the opposite direction for use of an automated expense reporting tool (64 percent among North American companies versus 40 percent among European ones).

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