Creating a Travel Policy That Matches Your Business Strategy

Business travel is essential for companies building an international presence. Hong Kong companies may do the majority of their travel in and out of Mainland China, or they may send employees across Asia and the world. Regardless of the destination, every mile you travel is important to your bottom line.

Summary:

  • Business travel is too important a part of your operations to manage on an ad-hoc basis
  • Travel policies can save money and reduce stress and complications for employees
  • Follow a clear plan and strategy when implementing a new travel policy
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Corporate travel is a major expense and it should therefore be managed like any other controllable expense. That means taking a strategic, rather than an ad hoc approach to managing it.

Making the Most of Every Mile

The most recent American Express / GBTA Business Traveler Sentiment Index found that 51% of Hong Kong respondents were required to follow travel policies, compared to a global average of 44%. That shows that travel policies are already very much a part of Hong Kong business travel. However, the same survey showed that less than half of Hong Kong respondents were satisfied with their employers’ travel policies, and only 38% were happy with the flexibility they have to plan trips. That leaves plenty of room for improvement.

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Travel is also an emotional issue. Your employees are spending time away from home and family in order to conduct business. They want to feel cared for, and making travel easier for them means better business for the company.

The travel policy at many SMEs is simply a list of rules — don’t fly first class and you can’t expense dry cleaning. Few SMEs have a policy based on an actual strategic plan.

Creating a policy which controls spending and steers business towards preferred suppliers, yet gives travelers enough flexibility for their trip needs is not an easy task. Communicating, implementing and enforcing the policy poses additional challenges.

Here are some tips on creating your travel policy.

Designing Your Policy:

  • Leverage your TMC’s knowledge of the travel industry, your company’s needs, budget and habits.
  • Customize it according to your locality, staff and industry. Consider multi-week business trips, travel to dangerous locations, rural versus urban travel and entertainment requirements.
  • Use simple rules and avoid exceptions and clauses wherever possible. Approval processes should be stringent and clear.
  • Cover all forms of travel and ancillary functions such as booking, approval, expense allowances, payment methods and required documentation.
  • Ensure that your TMC, travel policy, payment solutions and online T&E portal are integrated and communicate efficiently.
  • Set clear goals for the policy and review its performance. Be prepared to make changes if it does not produce the desired results.

Implementing Your Policy:

  • Involve senior leadership to highlight the importance of the policy.
  • Invite employee questions and suggestions at an early stage.
  • Promote the policy’s benefits to employees, such as corporate credit card rewards, travel perks, safety, productivity, faster reimbursement, etc.
  • Encourage compliance with rewards rather than punishment, ie: faster reimbursement, credit card rewards, ease of expense filing, upgrades, reduced personal liability, etc.

A well thought-out, clearly communicated travel policy can help you achieve consistent and repeated savings on business travel. The safety of employees when they’re travelling for business is imperative. Putting extra time and effort into creating a strong policy will make for safer and more efficient travel in the future.