To some, business travel is a welcome break from their typical routine, while others become stressed just thinking about the logistics.
Either way, a good corporate travel management program can help companies efficiently manage all aspects of travel for a more enjoyable employee experience and improved cost controls.
In this guide, we’ll cover the core components of corporate travel management, the benefits of these programs, and how to implement them.
What is corporate travel management?
Corporate travel management (CTM) is the process companies use to plan, organize, and control employee business travel. It includes setting travel policies, booking transportation and lodging, tracking expenses, and making sure employees stay safe on the road. The goal is to make business travel easier, more efficient, and cost-effective. A CTM program is typically concerned with things like:
- Trip planning
- Booking accommodations
- Expense tracking
- Employee reimbursements
- Compliance and traveller safety
- Managing travel vendor relationships
- Reporting
Corporate travel managers are often responsible for overseeing these programs. A smaller company may use a travel agent from an external agency, while a large or growing business may hire a full-time CTM manager internally.
Understanding the corporate travel ecosystem
Roughly one-third of all tourism spend in the United States comes from business travel, according to data from Statista.
Thus, corporate travel is a sizable market that consists of the individual travellers, the travel managers responsible for organizing their itineraries and accommodations, the booking platforms and tools they use to manage this process, and the travel vendors and service providers like airlines and hotels.
Coordinating each of these elements can be tricky, especially when done at scale. For this reason, a thoughtful CTM program and software solution help to simplify this process and make it easier for employees, finance leaders, and travel managers to coordinate business travel without compromising safety or efficiency.
Key components of corporate travel management
The specifics of a corporate travel management program can vary between companies. However, the following components are typically found in all CTM programs:
Travel policy development
Travel policies are the foundation of corporate travel management. These policies determine how and when employees can request travel, required approvals, preferred vendors, expense guidelines, and other employee responsibilities.
As we’ll cover in further detail below, setting corporate travel policies requires thoughtful stakeholder collaboration to ensure the procedures will enable a seamless employee experience, without sacrificing the company’s requirements and budget guidelines.
Expense management and budgeting
Expense management is another core aspect of CTM to ensure accurate accounting records and transparency into employee spending activities.
It’s common for businesses to use expense management software to easily track spending and monitor budgets for employee travel.
These tools enable employees to submit receipts while still on the trip and prepare expense reports when they return to enable quicker reimbursements.
Supplier and vendor management
Corporate travel managers are also responsible for establishing and maintaining relationships with third-party travel suppliers and vendors, including car rental companies, airlines, hotels, and other service providers.
Optimizing these vendor relationships can help companies secure favorable rates and priority support, supporting a seamless travel experience. In turn, companies may name preferred vendors that employees must book through based on their established relationship.
The role of technology in corporate travel management
Depending on the company’s size and travel needs, they may use a wide variety of digital tools and technologies to facilitate and oversee the process:
- Tools for booking and managing travel. Teams may use a centralized online booking tool to compare and book flights, hotels, and rental cars through a single interface. The platforms can be configured with the company’s travel policies for easy compliance (e.g., only showing hotels with nightly rates below a certain amount).
- Data analytics for travel insights. Some tools include predictive analytics capabilities to help teams uncover cost-saving opportunities, like flying outside of peak dates.
- Integrating travel management with financial systems. A centralized CTM software that integrates with the company’s existing financial tech infrastructure can be highly valuable. This ensures the seamless sharing of data between both functions, reducing the need for manual data entry and the risk of error.
Benefits of effective corporate travel management
When managed thoughtfully and enforced consistently, a CTM program can provide companies with a wide range of benefits, such as:
Cost savings and budget control
Having clear policies and enforcement in place helps teams stay on budget and avoid overspending on business travel. Rather than booking travel on the go without much thought, it’s done deliberately with someone responsible for monitoring spending and looking for ways to save.
Additionally, CTM offers a certain level of control over which accommodations are booked, ensuring flights and hotels are secured at reasonable rates. Plus, corporate travel management helps companies negotiate favorable rates with vendors, which can offer significant savings over time.
Improved employee satisfaction and productivity
Another benefit of CTM is that it supports employee satisfaction by making it easy for them to request and book travel that is necessary for their role.
A CTM program helps employees book arrangements in compliance with company policies, track spending, and have one streamlined platform to manage requests and itineraries.
In this way, it can also improve employee productivity, helping them spend less time on the intricacies of travel bookings.
Risk management and compliance
Effective corporate travel management also helps teams with risk management and compliance.
It gives teams real-time visibility into where employees are currently traveling, making it easier to determine any new travel advisories or events that could impact their safety or ability to perform their job duties.
These programs also make it much easier for employees to book travel in compliance with internal policies, helping ensure quick approvals on bookings and reimbursements.
Challenges in corporate travel management
Managing corporate travel is about more than simply booking flights and hotels for employees.
Especially as a company grows and travel becomes more commonplace, managers must find the right balance between managing costs and ensuring a safe and enjoyable travel experience.
Here are some of the common challenges that can arise with CTM:
Navigating changing travel regulations
Teams must stay up-to-date on changing travel regulations and guidelines to keep employees safe and compliant with local laws.
This can be particularly challenging for teams that frequently travel internationally. However, even recent changes in domestic travel guidelines, like the new REAL ID requirement, can pose some hurdles for corporate travel.
Managing employee travel preferences
It can be a challenge for travel managers to accommodate the travel preferences of all employees, especially when they’re also focused on securing good deals and adhering to the travel budget.
For instance, some employees might prefer to take the late flight the day before the event, while others prefer to have an extra day at home and fly in on the day of.
Taking individuals’ preferences into account can be easier for smaller organizations, but less practical as the company grows.
Implementing a corporate travel management program
Companies interested in implementing a corporate travel management program can follow these steps to create an efficient, safe, and on-budget travel experience for employees:
Step 1: Evaluate current travel needs
First, assess the company’s current travel needs and patterns. Consider how often employees fly, where they’re going, and the purpose of their travel.
Discovering these insights will make it easier to develop travel policies that facilitate a streamlined experience.
For instance, a growing team that has sales people traveling frequently to meet with prospects has much different travel needs of a smaller business whose employees only travel once or twice a year to attend conferences or company retreats.
Step 2: Develop a travel policy
Next, review any existing travel policies to revise them or create new guidelines. During this process, seek input from relevant stakeholders, like the employees who travel often, HR, and the finance department.
All travel policies should be well-documented and accessible to employees. It can be useful to include a list of permitted accommodations, acceptable purposes for travel, and destinations. On the other hand, it may also be worth mentioning some of the use cases or locations that are not permitted.
Step 3: Choose the right tools
Companies will also need to determine how they will manage corporate travel, whether delegating the responsibility to someone internally or hiring a third-party agent, and the tools they will adopt.
There are a wide range of tools available, and each company will need to review their options to find the best fit. Consider the following when choosing CTM software:
- The specific features/capabilities
- The types of customer support offered
- Supported integrations with your existing financial/accounting tools
- User-friendliness based on free trials or demos
Step 4: Secure strategic partnerships
The goal of many CTM programs is to get the company the best value for its money and ensure a smooth and safe travel experience for employees.
Securing strategic partnerships with travel vendors and service providers is instrumental to this goal. Among other benefits, it helps the company access discounted rates on travel bookings and secure priority support.
Travel managers of smaller organizations may decide to partner with a dedicated travel management company (TMC) to tap into their existing network of partners and suppliers. Otherwise, they can begin to reach out to vendors and suppliers directly to establish their relationship.
Step 5: Provide employee training
Once all the details are in place, travel managers should train employees on the new travel policies and how to utilize the new booking tool or travel request procedure.
Keeping employees in the loop, especially those who travel often, can help them feel informed about the new process and less frustrated about any changes that have been made.
The more aware they are of the new systems and how to use them, the smoother the booking and travel experience will be.
Step 6: Monitor and adapt
Corporate travel policies and management systems are not set in stone. Companies should monitor the success of their CTM program and make adjustments over time based on employee feedback, spending data, and other observations.
Travel agents can use the real performance data of the program to uncover cost-saving opportunities, uncover restrictive policies, or tighten up loose or unclear guidelines.
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Frequently asked questions
What is corporate travel management?
Corporate travel management (CTM) refers to the planning and coordination of business travel. It includes booking flights and hotels, tracking expenses, managing reimbursements, and risk management to ensure traveller safety.
Do I need to hire a corporate travel agency?
You can hire an external travel agency to manage your corporate travel needs. However, given the many corporate travel management software options now available, this may not be necessary. A tool like BILL Travel makes it easy for teams to make flexible bookings and manage spending and budgets on the go.
