Extracting Real Benefits From Travel & Expense Management

Monday, November 22, 2010 Label:
For your company to truly reap the rewards of a structured corporate travel policy, it must focus on one thing above all else: compliance. Unfortunately, while the explosion in convenient Self Booking Tools gives you a lot more freedom of choice, it also makes compliance a great deal more challenging. Any technology that supports an increase in compliance to policy has merit; it will save your company money and bring back the benefits of corporate travel.

Today's diversity of choice in self booking tools makes compliance through denial of access a very difficult protocol to enforce. What you really need is a funnel through which 100% of your company's travel activity must pass. In the corporate world, the only viable funnel is the payment mechanism – getting paid is the ultimate leveler. If you use a corporate credit card as the payment mechanism, supported by an expense management solution, and suppliers who can report back to you a reasonable level of data, you stand a very good chance of supporting the compliance objective.

A compliance-friendly Expense Management Solution (EMS)
An expense management solution which processes card transactions (and possesses decent workflow) requires the traveler to personally justify all deviations from policy to their supervisor – on a transaction by transaction basis. Just as importantly, the warehoused individual transactions give the corporate travel manager the opportunity to conduct spend analysis and examine individual and aggregate behaviors.

You might argue that this is after the act, but it still encourages compliance. As per all card based procurement systems, if an employee consistently deviates from company policy, they may be penalized (e.g. card withdrawal, official warning, employment termination, etc.). The threat of negative repercussions acts as a deterrent to card misuse, thereby increasing the level of compliance.

The benefits of policy compliance

80% of the business case benefits of corporate travel will come from travel policy compliance. This requires:

• Sound policy and procedures;
• A comprehensive communication strategy;
• A gate through which all activity can be channeled (the card and the expense management solution); and
• Tools to monitor and measure compliance.
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