Managed Vs. Unmanaged Corporate Travel Program: Which One Is The Best For You?

January 19, 2023

Managed Vs. Unmanaged Corporate Travel Program: Which One Is The Best For You?

corporate travel program

Business travel is no longer the same as it used to be a few years ago when only a few employees would go on business trips to meet prospective clients or strike new business deals. Over the years, the business travel industry has grown by leaps and bounds, and the global business travel market is expected to reach $791. 9 Billion by 2026. 

As more and more employees travel to meet their business goals, companies need to accommodate the increasing travel requests. You can do this only by defining a proper framework that helps optimize their business travel process. And the best way to do this is with the help of a corporate travel program. 

What is Corporate Travel Program?

A corporate travel program is a set of procedures and policies an organization adopts or implements to manage their business travel effectively. The main aim of a business travel program is to optimize business travel spending while also improving the business travel experience. This involves processes such as booking hotels and flights, trip approvals, preparing and managing travel itineraries, handling trip expenses, and ensuring employees’ safety. 

There are two types of corporate travel programs: unmanaged and managed. Let us understand the difference between the two. 

What is an Unmanaged and Managed Corporate Travel Program?

An unmanaged travel program allows employees to book their own business trips. They book flights, hotels, and cab rentals on their own, either through third-party websites or directly from the hotel and flight websites. During the booking process, the travel manager is not involved, and only after the booking do they get to know what employees have booked. 

In a managed travel program, the travel manager makes all the bookings on behalf of the employees. The travel manager has to book flights, hotels, and everything else for all employees. 

However, booking and managing travel for all employees is a time-consuming and tedious process. This is where Travel Management Company (TMC) comes into the picture. The TMCs manage everything right from travel bookings, budgeting, analysis, insights into travel data, trip approvals, cost management, and many more. Therefore, in a managed travel program, you have complete visibility during the booking process. 

Managed Vs. Unmanaged Travel Program

Determining the right approach for your business travel management can be challenging.  Mentioned below are some of the points that will compare unmanaged and managed corporate travel programs: 

1. Travel Policy Compliance

In an unmanaged travel program, employees have the freedom to book their own business trips. However, when employees are left to make their own travel arrangements, there is a huge potential for non-compliance. 

This is because employees book flights and hotels that align with their choices and not with the travel policy. And when employees fail to comply with the travel policy, it can adversely affect the company’s monetary health. 

A managed travel program can help your employees comply with travel policies. The TMCs help you make business travel arrangements, such as booking flights and hotels and preparing a good travel itinerary per your company’s travel policies. 

Additionally, they also use travel management software, within which travel policies are integrated. So if employees make any out-of-policies bookings, the software automatically alerts the employees and trip approvers immediately. It also provides employees with a self-booking option to book their own trips while ensuring travel policy compliance simultaneously. 

2. Cost Optimization

In an unmanaged travel program, employees may not always book the most cost-efficient options. This is because they sometimes book a few days prior to a business trip’s commencement, or the options available are not according to their preferences. 

Additionally, they may not be able to get good corporate deals and discounts as the websites are designed for personal travel. Therefore, hotel chains do not get incentives to offer any discounts for business travelers. 

However, a managed travel program assists you in saving travel costs. A TMC has a team of experts who create a budget for business travel and negotiate with hotel and flight vendors to get the best deals and discounts. 

Also, the travel management software uses a GDS (Global Distribution System) for the best hotel and flight inventories. This lets you access Low-Cost Carriers that help you save some bucks and thus aid in cost optimization. 

3. Employee Safety

As an organization, you must take care of your employees at all times while they go on business trips. In an unmanaged travel program, travel managers and organizations have little to no visibility about the whereabouts of their business travelers. It also doesn’t provide any way to easily track employees’ safety or locate them during an emergency. 

A managed travel program provides you with a comprehensive duty of care plan as a part of your business travel program. The plan includes the destination’s risk assessment, employee health check-ups, business travel accident insurance, and many more.  The TMCs also provide 24/7/365 business travel support to your employees if they are stuck in any emergency situation. 

Also, travel management software has a live traveler tracking feature, where you can know the whereabouts of your employees. This way, with managed travel, you can ensure employee safety.

New call-to-action

4. Expense Reporting 

When employees book their business trips, they rarely have access to the company’s finances or take enough cash from the company before they embark on their journey. Hence, most employees often have to shell out money from their pockets, collect physical receipts for every expense made, and then apply for reimbursement. 

Additionally, employees can also make fraudulent attempts by duplicating the bills or tampering with them. If your company has been following the unmanaged travel program, this process is highly inefficient, time-consuming, and costly. 

On the other hand, a managed travel program has automated expense management solutions that will make your expense management process seamless. It offers an interactive UI for employees to file their expense reports easily. All they need to do is, take a picture of their receipts, upload it on the software and send it to the approver. The approver gets an instant notification and approves them. Once it is approved, it goes directly to the finance department, which will then validate and reimburse the amount. 

This significantly reduces everyone’s burden as it saves time, improves the operation process, reduces costs, and eliminates fraud. Automated expense management solutions also have a centralized platform that covers everything from bookings, and invoices to reimbursements. 

5. Data Management

You require data to completely understand how much you are spending on travel and formulate travel policies. In an unmanaged travel program, apart from the bookings, you do not gain insights into other data such as the level of employees, incidental expenses, etc. Also, you will not have access to these data to plan future business trips. 

However, you can get complete data visibility with a managed travel program. Modern company travel software offers advanced analytics by compiling all the data in a single dashboard. These dashboards are customized, and hence travel managers, trip approvers, and finance officers can access data in real-time effortlessly. 

For instance, you can get data on employee type, department-wise, destination, type of airlines and hotels, etc. The consolidated data will help you with data management and thus help you make informed decisions. 

6. Employee Productivity

Anything that keeps your employees from accomplishing their daily tasks comes with a cost. In an unmanaged program, employees spend a lot of time browsing through multiple third-party websites. This wastes too many hours which otherwise they could have spent working on some crucial office tasks. 

A managed travel program empowers employees with a corporate travel booking platform consolidating flights and hotels on a single platform. Employees get handpicked personalized choices from a vast inventory of flights and hotels. This means employees need not navigate through various websites searching for the right option, thus saving a lot of time and effort. 

Managed Corporate Travel Program Is The Best For You

There is no doubt that a managed corporate travel program is better than an unmanaged travel program. With unmanaged travel, it is difficult to manage data, increased flight and hotel costs, policy compliance, and many more. This is where TMCs can help simplify your booking and travel management process. 

ITILITE’s integrated travel and expense management software offers lightning-quick bookings, advanced travel analytics, an extensive inventory of hotels and flights, end-to-end expense management, live traveler tracking, and many more. 

To know more about ITILITE’s advanced features, book a free demo with our product expert today!

Try ITILITE for free now. 

Meta-title:

Meta-description: Corporate travel programs are important aspects of an organization. Read this blog on managed vs. unmanaged corporate travel program: which one is the best for you?

Author : Priyanka Kamath
Priyanka Kamath is a content writer and marketer at ITILITE. She quit her clinical research job to pursue something she loved-content creation! An avid traveler and travel influencer, she loves creating memories and narrating stories through videos and photos. She loves watching thriller movies and is an ardent cricket enthusiast.