Lower those high-flying travel costs

This is a common scenario in the world of business travel:

Little Start-up Company makes shrewd business decisions, adds new product lines or services, hires more and better sales and executive staff who do the right stuff. Little Start-Up Company grows and becomes a Major Global Player, with a travel budget to match.

In the air, on the road, away for a few days -- or a few weeks -- the traveler tallies up the receipts and submits them to accounting. Simple enough, no questions asked. Major Global Player has no real travel guidelines in place because "everyone knows" that business travel is important to even greater success and it costs money to make money, right?

Along with this no-holds-barred approach to corporate growth, it's often assumed the company's high-flying frequent travelers will keep the bottom line in mind as they traverse the flyways and byways.

The problem is, not all of them will. And even those who truly care might find it difficult to make the right choices from among the ever-changing air carrier, hotel and rental car options. And let's not overlook those seductive frequent traveler programs that promise free airline tickets and hotel rooms in exchange for unwavering loyalty.

Controlling costs

There is a better way to let travelers know what's expected of them: put it in writing.

A written travel policy, no matter how simple, is a far better tool for controlling costs and keeping an eye on travel patterns than trusting luck and good sense.

Of course, the best time to develop a written policy is in the beginning -- during the Little Start-up Company days. But putting it in writing anytime along the way is far better than pretending this second-largest budget item will magically regulate itself.

So what constitutes a travel policy? And how do you move from vague assumptions to the written document?

It's not easy. Writing a travel policy can be a daunting task, one that is easily put on the back burner. But if travel costs are to be controlled, it is essential that a written policy, one which clearly spells out company philosophies and expectations, be developed. And then comes the really tough part: The policy must be endorsed by top management, implemented, monitored and enforced.

Take basic steps

There are basic steps that can take any size company from no policy to a workable set of guidelines which recognize an existing corporate culture while reigning in inconsistent and costly behaviors.

At the outset, resist the urge to form a "Policy Committee" composed of most-frequent travelers to labor over the nuts-and-bolts of the written document. The goal is to develop reasonable guidelines that work for all travelers, not just those with vested interests.

Assign the project to a senior staff member such as an executive assistant who has travel industry knowledge and hands-on experience making travel arrangements.

This person will generally bring fewer biases to the table that might skew the decision-making process, thus minimizing delays and the politicizing that often result from policymaking by committee.

It's equally important to solicit regular input from designated travelers, travel arrangers, key finance staff and senior management.

Next, decide if controls are to be:

• Low (setting forth corporate expectations without specifying vendors)
• Medium (suggesting several air carriers, hotel groups and car rental companies that mesh with the goals of the company travel budget) or
• High (specifying which air carriers, hotel groups and car rental companies must (and must not) be used, monetary limits, per diems, pre-trip approval procedures, expense reporting procedures, etc.).

It's a balancing act

Because business travel is often a balancing act between cost effectiveness and convenience, a very strict air travel policy could tip the balance toward cost-savings at the expense of convenience and traveler comfort.

On the other hand, a policy that is too loose allows travelers to make decisions based on personal agendas such as frequent flyer miles, favorite hotel chains, etc.

Decide whether travel is to be booked through a designated travel agency or on the Internet, with or without the assistance of a company travel arranger. While the internet offers convenience and options for business travelers, unmonitored booking usually means the company relinquishes the control and reporting necessary to oversee expenditures and track compliance.

Funneling travel arrangements through a company travel arranger, rather than allowing each traveler to make his or her own arrangements, can also keep a travel program on the designated track.

Many full-service business travel companies have sophisticated tools and staff to help travelers comply with a written travel policy, and the reports they generate can pinpoint deviations and areas for improvement.

Look for an agency that offers assistance with travel policy development and an online booking tool that can be private-branded, one which allows travel policy controls to be programmed in behind-the-scenes to guide the traveler or travel arranger. This combination can offer the best of both worlds — online convenience with the technology to guide and control travel decisions.

Enforcement essential

Whatever components ultimately comprise your written travel policy, there are several keys to making it work. The policy should be fully endorsed and issued by top management, and -- this is critical -- it must be enforced.

A written travel policy, however well-crafted, is ineffective if it is not distributed to all travelers, including new employees. Ideally the initial launch should be accompanied by an in-person announcement or a cover letter from the company president or other senior staff spelling out the goals and rationale behind the policy. The message should be clear: "We support and will adhere to the policy and we expect you to do the same."

Long or short, tightly controlled or not, a written travel policy is a valuable tool that can guide employees toward effective travel decisions and the company toward substantial savings on one of its largest budget items. What better way to go from Little Start-Up Company to Major Global Player?