One of the questions frequently asked by our corporate travel clients is whether they should request that their travel management company review and recommend changes to a company travel policy and, if so, how often this process should occur.
The answer to the question can vary dramatically based upon numerous tangible and intangible items that are particular to the corporation and its culture. Certainly, there is no harm in the corporation asking its TMC to conduct such a review. However, in order to do so effectively, the TMC must have a fairly good grasp of the corporation's travel philosophy, travel patterns and corporate culture. (And if that's not the case, perhaps the partnership itself requires rethinking.)
Generally, I do recommend that companies have their designated TMC review the corporate travel policy at least on a yearly basis. Even if no changes are suggested, doing so serves as a refresher to the agency regarding the policies and procedures they should be following when booking travel on behalf of your company's travelers.
What to review
First of all, to clarify the balance of power, it is solely the travel manager's responsibility to develop the corporate travel policy in conjunction with senior executives. The TMC's role is merely to review the policy and make recommendations based upon industry knowledge and experience with other clients.
Among areas of policy that should be examined during the review:
• Preferred vendors. Most corporate travel policies require all travelers to use preferred vendors, except in emergency circumstances. Many companies refuse to reimburse travelers for any expenses incurred above negotiated rates.
The biggest savings can be found in controlling air transportation. Many corporate travel policies attempt to restrict travelers to one, two or, at the most, three airlines, depending upon travel patterns.
The TMC is in a position to make recommendations to the corporation as to what other client companies are doing with regard to advance-purchase fares, the use of alternative airports, or travel outside of regular business hours when fares are less expensive.
• Saturday-night stays. This isn't the issue it once was, since most low fares today don't require a Saturday night stay. However, policy still should address whether the company will reimburse additional expenses if a traveler extends the trip to take advantage of significantly reduced airfare.
• Connections and more. Are travelers required to use multiple stops or connecting flights, which are less expensive than nonstops? Are they required to take a later or earlier flight than desired in order to save travel expenses? If so, within what window of time/level of savings would such concessions be required?
In determining such policies, the corporate travel manager, in conjunction with the company's senior executives, must determine at what point traveler convenience is more important than cost savings. Obviously, this varies for each company and is closely intertwined with corporate culture. Further, the executive-level traveler and the type of trip that is involved, i.e., international, multicity, one day or a few days, might also affect policy decisions.
Tweak as needed
A yearly policy review is generally enough, but circumstances might call for more frequent revisions. If there have been notable changes in travel patterns or travel expenditures, or a new travel management company has been selected, it's wise to go over policy once again.
Any changes that are made must be set forth in writing. And, most importantly, the policy itself and any revisions must be clearly explained and distributed to the employees so that their rights and obligations are clearly understood.
Jeffrey R. Miller, Esq., is a shareholder in the law firm of Lipshultz and Miller P.A. and president of The Miller Travel Group Inc. (jmillerlaw.com), a travel industry consultancy. His offices are in Columbia, Md.