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Corporate travel policy compliance is a big problem for companies. A survey conducted by the Association of Corporate Travel Executives (ACTE) revealed that 72 percent of travel managers are dissatisfied with the level of compliance. Another report added that 50% or more of hotel bookings are outside of corporate policy.
Does this resonate with you? In this blog, we will discuss the common problems of why your employees aren’t complying with your corporate travel policies and their solutions.
While perhaps most applicable to travel managers, these solutions for improving policy compliance can be adopted by anyone who deals with travel-expense reporting.
In many cases, this is due to lack of or poor communication. If your employees aren’t aware of a formal corporate travel policy being in place, you cannot expect them to comply with the standards. Some employees might know that corporate travel policy exists, but may not be aware where it can be found, when needed.
First things first, improve communication with employees regarding travel policies. One great way of improving communication is to talk about it and share it with employees via channels that are easily accessible and they are comfortable with – intranet, slack, etc. You can also create awareness by conducting regular training sessions or making announcements in mini gatherings, especially when you are updating the policy. Taking quizzes or holding practice runs can also help in ensuring 100% awareness regarding the policy.
The next step is to make policies easily accessible to employees. You should ensure that an employee from any department, and any level of management, should be able to find the travel policy within minutes. This can be achieved by integrating travel and expense management software with an inbuilt policy feature that lets you present the terms of the travel policy to employees at the time of booking (the policy is right there when they actually need it!). This helps improve policy compliance as an employee is aware of his/her expense limit and gets a notification if anything is booked out of policy. Advanced travel and expense management software such as ITILITE also offers the feature of not showing hotel/airline options to employees that are out-of-policy for them.
While a policy might seem clear to the writer, employees may find it hard to understand with the usage of complex terms or industry jargon. Also, there are chances that the employees are not aware of the benefits that are there for them if they follow the travel policy and thus, do not take interest in it.
Make sure your travel policy is written in a simple, easy-to-understand language. Adoption of policy will increase once the employees understand the “why” of things. They must be aware of the resources that are in place for them, to protect them.
For instance, the BTN survey suggests that travel managers should leverage duty of care to enhance compliance. Let’s understand this with an example – a T&E solution has the technology that allows businesses to track the employees who are traveling. But then, this is only when they use the technology. Many employees book hotels out of the T&E Solution which prohibits travel managers or the company from knowing about employees’ whereabouts.
Now, this has to be highlighted in your travel policy prominently, maybe at the beginning itself. Clearly, communicating about employees’ benefits of using the company’s T&E solution and following the policy can help improve policy adoption and further compliance.
Employees calling a travel agent or communicating via email with a travel manager to book a business trip can lead to compliance issues. The travel agents are not aware of the travel policy and likely book outside it. This happens when employees are not given a self-booking option.
You have to build a culture of accountability by giving employees more freedom and responsibility to manage their corporate travel. You should integrate a T&E management solution that provides you the ability to set in-built policies and approvals flows beforehand. An employee can book their own trip within the policy or save the itinerary and take approvals for extra spending.
This could also help you in reducing spending and improving compliance. How? There are T&E solutions that allow you to reward employees for choosing low-cost options (gamification), and provide curated options which are personalized and within policy. In this way, while employees get encouraged to use the T&E solution, you get to save business money as well as keep your employees safe.
The manual travel process kills travel policy compliance. Business travel policies are complex and will always have exceptions; with manual processes, 100% compliance will never be there. When an employee books business travel manually, there are chances that they don’t refer to the travel policy to know their expense limits, or they don’t take approval as the process is time-consuming & go ahead and book travel.
An April 2013 Aberdeen Group Report shows that investing in an end-to-end solution (the entire process a traveler takes, from the actual travel to post-travel reporting and analysis) to manage business travel results in a 44% improvement in compliance.
Therefore, automating your travel booking and approval process will help you reduce confusion and ensure much higher levels of travel policy compliance. It will make sure that the bookings are within policy and exceptions are handled well with approval flows. Of course, there will be last-minute bookings but they can be easily tracked with the T&E solution.
It might be that your travel and expense software doesn’t have an intuitive interface and is difficult to use. This can discourage employees from using your T&E solution. And remember, any trip that is not booked from your T&E solution, is not in compliance.
Having a travel booking tool is not enough. The UX and ease of use drive software adoption. Add a feature checklist to be considered as you finalize your integrated T&E solution. Features that we think are essential in T&E solutions are:
When employees like your T&E management solution and use it, you will be able to improve compliance and control spending.
It might be that your software does not configure complex policies. For instance, an employee traveling internationally may require a higher expense budget than when traveling domestically. If your software does not give the flexibility to configure complex flows for various scenarios, it might lead to compliance issues.
An integrated T&E solution lets you customize your policy for:
It lets you handle all exceptions easily. For instance, if an employee wants to book an international trip, then the policy will show expense limits according to the destination. This will encourage the employee to use the T&E Solution and be compliant.
Choosing an integrated travel and expense management software is one of the most important factors in pushing travel policy compliance. ITILITE is dedicated to delivering tools tailored to your business travel program’s particular needs and can assure that you are properly equipped to drive your business travel forward. Get in touch with our product expert today!