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Establishing a travel policy.

Article Excerpt
Establishing a travel policy is the most vital communications tool a corporate travel department can have. Travel policies serve to create and maintain an effective travel program, providing traveling employees with direction to ensure compliance with regard to preferred suppliers as well as booking practices that can result in substantial savings and higher service levels. Policies increasingly are becoming more comprehensive and are including stricter enforcement mechanisms to ensure that supplier commitments are met and superfluous spending is minimized.

Some corporate cultures are not conducive to issuing strict travel policies. Even for those businesses, though, the issues of traveler security, safety and tracking have continued to be important concerns. For tracking purposes, travel managers should include in their policies a requirement that all bookings be conducted through the company's designated agency or online booking tool. Some companies also have strengthened requirements for pretrip approval processes or even mandated agency usage to foster better employee tracking.

To deliver policy to employees and communicate updates or country-specific warnings, travel managers should take advantage of the company's intranet travel page and e-mail systems, which also offer employees avenues for communicating feedback to travel managers.

A successful travel policy encourages travelers to use specific travel suppliers and classes of service by setting reasonable guidelines, explaining why the company has adopted them and, in many companies, defining penalties for those who do not comply. Companies that put in place a strong policy can reduce unnecessary spending; prove their ability to move marketshare and gain negotiating leverage with suppliers; help travelers accomplish their missions by putting in place structures and procedures to save time and effort while providing them with an acceptable level of safety, service and comfort; and enhance overall travel process productivity, from planning through submitting an expense report.

The written travel policy is the articulation of the company's culture as it relates to travel. A policy development process that addresses many or all of the elements out-lined below should provide a solid foundation for travel policies that fit your company.

I. QUESTIONS TO ANSWER

A. who should write and update the travel policy?

1. One person, such as a travel manager, who has extensive knowledge of the travel industry or world regions should do this. The individual should be the sole publisher of the document, with collaboration from various entities in the company. The travel manager also may wish to consult with a travel management company or a travel consultant to provide perspective on accepted industry standards or benchmarks.

2. A committee of people from various departments within the company: accounting, administration, finance, HR, purchasing, sales and marketing, and any department with a high frequency of travel. The committee should make recommendations to a policy writer for implementation. The travel committee should seek input from travelers, who can help interpret the impact of policy decisions.

3. A high-ranking executive: a key department head, the CFO or CEO. It is always helpful to include a letter of support from the CFO/CEO when you communicate policy.

4. Different people at different sites or divisions: For global policies, having reps from all the countries involved often helps win support and improves compliance.

5. A combination of the above: At many companies, the travel manager writes the policy for approval by a committee and senior management.

B. Who should be subject to the policy?

1. Employees at headquarters or whatever location is issuing the policy only. This is easiest to administer.

2. Employees at any domestic location, division or branch: This offers greater cost control, but could interfere with autonomy for individual units and locations.

3. All employees, including those overseas: This choice should take into consideration that travel expenses are more difficult to track overseas, and differences in international laws and cultures could make it impractical or inadvisable to mandate adherence to various policies. It may not be feasible to get every country into the policy parameters.

4. The policy should stipulate that individual travelers as well as groups are subject to identical policies. Some companies, however, may want to cover groups, conferences and meetings in a separate policy or department.

5. The policy should include consultants, job candidates, customers and subcontractors as well.

6. Institute an umbrella policy for all employees that divisions individually can restrict, if necessary, but not relax.

C. Should policy apply equally to all levels of employees?

1. Yes: This sends a message to employees that management is serious about controlling costs and that no one is above pitching in to help.

2. No: It might not be in a company's best interests, for example, for its president to waste time changing planes to save on the cost of a ticket rather than applying his expertise to achieving company goals. Special consideration might be given to vice presidents and above.

However, when policy does not apply equally, some corporations do not make this apparent in their travel manuals, so as not to affect the morale of rank-and-file employees or their willingness to adhere to policies. Others feel that travel manuals should be forthright about senior management having perks, lest travelers assume that superiors are ignoring policy and conclude that is acceptable for them.

3. In case of a common disaster, many companies restrict the number of key executives who may travel together on a single aircraft, ground transport or ship.

D. How forceful should the policy be? This is a major company-culture consideration and completely subjective.

1. Wording can clarify that policies are company mandates and that violators will be dealt with harshly, including denial of reimbursement, up to and including termination.

2. Policies can be presented as guidelines, with explanations required when the guidelines are not followed. Considering the amount of money T&E now represents at most corporations, many policies are moving away from such language as "guidelines," "recommendations" and "suggestions," and simply making everything "policy."

3. Policies can be presented as standard procedures carrying the company's official stamp of approval, under the signature of the CEO or CFO.

4. Policies can be of different force...

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