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Corporations should strive to reconcile the various and often overlapping costs and processes required to support total employee mobility, but few are, according to Runzheimher International. The company's vice president of market development Heidi Skatrud this week led an Association of Corporate Travel Executives webcast in which she advocated an integrated approach to cover travel management, business vehicles (from cars to corporate jets), overseas assignments, relocation programs and mobile/virtual workers.
"The problem is fragmentation," Skatrud said. "Many of these categories of mobility happen to [impact] the same person, but are managed by different parts of the organization. When everyone is responsible for a given area, no one is responsible."
She noted that mobile workers--often top executives, sales professionals, client service managers and other "critical segments"--now account for a quarter of the workforce, and their numbers will grow rapidly. To attract and retain talent, employers must recognize their needs (including transportation, expense management tools, laptops, personal digital assistants, cell phones and home-office support) and foster higher levels of productivity. They also must consider business continuity planning to create an agile workforce and prepare for catastrophic events, said Skatrud.
With those goals in mind, travel management professionals have an opportunity to coordinate with human resources, finance, procurement, corporate services and other departments touching employee mobility services. Such coordination can lead to cost savings, process optimization and improved employee relations, she added.
Skatrud suggested most organizations currently are "hard-pressed" to accurately assess total employee mobility (TEM) costs dispersed across various departments, but noted Runzheimer benchmarks which show an average total investment equivalent to 13 percent of operating income. "The typical organization is investing between $4,000 and $5,000 per year per employee," she said, which "equates to the amount of money that corporations are spending to provide health insurance to their workforce today."
When looking only at mobile employees, that figure swells to as much as $25,000, "equivalent to the total cost of providing a total benefits package to that employee." Travel (51 percent) is the largest contributor to TEM costs, Skatrud explained, followed in order by fleet, international assignment programs, relocation, corporate aircraft and mobile offices.
She offered several recommended steps for organizations interested in centrally managing those expenses, starting with the basics: benchmark costs, solicit feedback from affected employees and alert senior management. From there, employers should consider enrolling affected employees in relevant programs (such as business vehicles, for example) and begin to leverage overlapping processes.
"For example, $1 in every $5 spent on relocation really is a T&E expenditure," Skatrud noted. Other examples include corporate aircraft, which "often" are not covered by the travel management program and instead are usually handled by corporate services or another administrative department. Also, online educational tools, designed to help prepare expatriates for international travel and living, are generally not proactively offered to international travelers, she said.
Once such intersections are identified and addressed, organizations can then determine the impact of proposed changes to business processes.
According to Runzheimer's 2005 benchmarking, more than half of all surveyed organizations did not yet have a formal policy covering virtual workers. But some household names do, and have reaped the benefits of higher productivity and reduced costs. Skatrud said Dow Chemical in the 1990s cut sales offices from 21 locations to one by embracing the shift to mobile working arrangements; AT&T saves $180 million annually by using more tele-workers; and IBM realized a 20 percent increase in productivity while saving $10,000 per tele-worker ($700 million overall), driven by reductions in facilities costs.
In general, however, Skatrud said organizations "have a way to go" in leveraging disparate departments and processes to more efficiently support mobile workers. "Those that do it the best will have a competitive advantage," she concluded. "It is entirely possible that, ten years from now ... some person in this audience will have the role of director or vice president of employee mobility."
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