Regional Director, Europe & Middle East, ACTE
Corporate travel has changed beyond compare in the last quarter century, says Caroline Allen, Regional Director, Europe and Middle East, Association of Corporate Travel Executives (ACTE).
One of the reasons for this is mobile access to the web and direct sourcing: with reduced use of negotiated deals and greater access to technology on the move, many corporate travel buyers and managers understand that business travellers are pushing the boundaries to book their own travel, believing they can do so more effectively.
Indeed, often business travellers can source very effectively although there is still value in centrally managed travel procurement. Under Duty of Care legislation, employers have an obligation to ensure employees travelling on company business are as safe as can be reasonably ensured.
Travel managers and corporate travel buyers therefore need to know where employees are and ensure they are using reputable, company-approved airlines, hotels and ground transport options. Travel managers need to be able to track the location of employees travelling on company business, both at home and abroad, to provide support and assistance in the event of a major event: for example a Tsunami, an earthquake, ash cloud or terrorist attack.
Leisure fares don’t have a corporate code to be able to track volume and trace reservation ownership. That means a corporation using a lot of leisure fares could make many thousands of air bookings but only know about the ones booked on the corporate booking code through the designated TMC.
The answers for many corporate travel managers and buyers depend on the speed of the next generation of technological innovation.
On a Duty of Care level it means that the emergency support a TMC can give to a traveller who has made their reservations through their own source is limited. A TMC will also be unable to change a booking a traveller made directly, limiting their day to day support servicing ability and on a financial level, it affects the corporations’ buying power as not all business volumes can be attributed to the company budget expenditure.
Technological innovation in corporate travel
The answers for many corporate travel managers and buyers depend on the speed of the next generation of technological innovation. But we will see a major development in NFC. Near Field Communication is the ability to pay for travel arrangements and a multitude of services on a mobile phone. The impact is likely to have a significant effect on the managed corporate travel programme.
If a business traveller receives a text alert or email on their way to the airport to offer a discounted cabin upgrade and accepts it using their mobile to pay for the upgrade, the associated fee may appear on the traveller’s expense report rather than on the travel manager’s corporate travel budget. Aside from skewing the ability to track total travel spend, again it dilutes the overall company purchasing leverage.
Flexibility is key
As travel expenditure overall remains one of the largest spend categories, some corporations may restructure their organisations to increase the travel manager or buyer’s remit to include influence over mobile and T&E expenses in a bid to contain or reduce overall costs which can run into multiple millions of pounds in the our globalised procurement environment.
We may see travel managers and buyers changing their travel policy metrics towards containing the total trip cost rather than focusing on each component part. That may mean they need different tools and measurement mechanisms which may not yet have been invented to be able to provide budget holders and travellers with the best information to make the right decisions for their company. More than ever, flexibility remains key.