It’s no surprise procurement teams generally include a travel category specialist.
Travel accounts for 10-12 per cent of the average corporate expense budget, according to research company Aberdeen Group. That makes travel the second-largest controllable annual expense for most businesses, behind only salaries and benefits.
With so much of the company purse at stake, naturally procurement needs to manage what travel suppliers employees book. But here’s the problem. In the travel category, it is essential to control not only what but also how employees buy. If travellers aren’t booking through a channel that you manage, you can’t know which vendors they are choosing or whether they are following policy on permitted spend levels and class of travel. There is also the duty of care issue: employees who book wherever they like can’t be tracked in an emergency.
In theory this problem was solved 20 years ago, when the first corporate-controlled online booking tools with in-built policy filters and management information reports were launched. But in practice, it’s a different story. Many travellers ignore the in-house tool and, armed with their smartphone or tablet, book directly on consumer websites or, increasingly, via some seriously sexy mobile apps. Leakage of 40 per cent from policy for hotel reservations is very common. As a result, procurement departments risk losing control of their spend.
One of the main reasons travellers are booking via consumer sites and apps is official corporate tools simply haven’t kept pace. This may be 2015, but too many of them still look like accounting software circa 1994, often still requiring access via the corporate desktop while unavailable on mobile.
Mercifully, this situation is finally changing. A new generation of mobile-friendly corporate booking tools deploy door-to-door technology: the traveller simply punches in where their journey starts, where it ends, and what time they need to be there. Within a couple of seconds the tool presents a fully costed, policy-compliant itinerary, including ground transfer arrangements, flight/train and hotel. It’s all graphically based, not text-based like the old tools, with mapping and pics of the destination thrown in. What’s more, the itinerary can upload to the traveller’s expense report, saving work for them and creating a clear audit trail for you and for accounts.
Door-to-door works because it delivers the controls you need as an employer but functions for the employee better even than those sexy consumer mobile apps. Now that corporate booking tools have finally burst into the digital age, I strongly recommend reviewing what you have in your organisation to assess whether your booking technology has stayed fit for purpose; for your needs, as well as those of your travellers.
☛ Dean Forbes is CEO of KDS