It’s common to assume that you might not need a business travel policy. Maybe your company is only just starting out, still in its early growth stage, or just doesn’t do much business travel.
That line of thinking couldn’t be more wrong, though.
A company travel policy isn’t something exclusive only to large businesses. Even small startups whose employees only travel twice a year can really benefit from having a solid corporate travel policy.
Corporate travel policies reduce time-wasting, repetitive, and redundant questions. It’s a place to turn to for convenient answers and guidance to ensure everything is on the up and up with the company.
Having a business travel policy in place helps foster fairness and transparency. It also provides employees with greater freedom and autonomy while maintaining corporate authority and management.
Most importantly, it also serves as a way to ensure the safety of your travellers, especially in today’s post-COVID world.
Now that we’ve established the need for a travel policy, how do you go about building one that employees would follow?
Creating, maintaining, and enforcing a company travel policy doesn’t mean micromanaging every last detail of your employee’s business trip. Instead, it means providing them with the tools and information they need to feel safe, comfortable, and supported by the company.
Moreover, many travel policies today centre around flexibility and providing employees with greater freedom to arrange their business travel.
Our guide will give you everything to do exactly that — we’ll discuss various travel management styles, provide tips for creating modern travel policies, and offer techniques to help increase compliance.
The Downside of Travel Policies
Anything connected to the word “policy” is often instantly deemed complicated and overwhelming. Company travel policies are no different. Travel arrangements and requirements can already be time-consuming and challenging to take in without adding company rules into the mix.
When we know what employees don’t like about their current business travel policy or what keeps them from fully using them, we can create policies that specifically avoid those issues.
4 Common Problems with Travel Policies
- The policies are too technical or difficult to understand.
- Almost no one bothers to read the policies due to their length.
- No one remembers the content of the policies.
- Companies don’t automatically enforce travel policies.
These issues contribute to a low policy compliance rate. A 2018 survey by Skift and Turkish Airlines showed that only 60% of business travellers follow their company’s travel policy, particularly when booking their accommodations.
Understanding the common problems with travel policies can help guide us in creating one that employees would want to use and appreciate.
Failure to heed these common problems can easily make all the effort we put into creating a great corporate travel policy to waste.
Why Build a Corporate Travel Policy?
The difficulty in creating and ensuring compliance with business travel policies might turn you away from putting any policy in place. You wouldn’t be the only one to think this way, either.
Sixty percent of companies in the U.S. don’t have a corporate travel policy in place.
However, in doing so, you can miss out on several important benefits — not just for employees but for your company.
Travel Policy Benefits for Travellers
- Clear rules and regulations
- Less hassle when making travel arrangements
- Fairness amongst the team
- Ensure safety and wellness
- Better flexibility and autonomy
Travel Policy Benefits for the Company
- Lessen travel cost spikes.
- Improve management over company travel expenses.
- Streamlined reimbursement protocol.
- Increased fairness helps foster better employee sentiment.
- Positive company culture.
Creating a business travel policy provides you and your company with clear guidelines. This, in turn, helps ensure fairness and equality for everyone.
A Step by Step Guide to Writing a Business Travel Policy
Now that we’ve had a better perspective on travel policy dos, don’ts, and the benefits, it’s time to focus on writing one.
Here is a quick look at our seven-step, fool-proof process for writing a modern business travel policy:
1. Review existing or previous travel policies
Similar to how we took a look at the dos, don’ts, and benefits, it is also important to review old or existing policies.
2. Outline policy goals and identify stakeholders
In any project or undertaking, it is best to start with clear goals and priorities. Regardless of whether you choose to focus on reducing confusion or limiting travel expenses, you and your team should be clear on what the policy’s focus should be.
During this stage, it's important to involve all of the right people. This will help ensure the fairness and appropriateness of your travel policy.
3. Ensure it’s easy for everyone to use the policy
As early as now, think of a way to make using your travel policy convenient for everyone who may need it — whether they are rank and file employees, supervisors, or executives.
This will help ensure that everyone is aware of the new policy, where they may access it, and how to use it.
4. Decide on the travel management style or strictness
Before you can create the travel policy’s rough draft, it is important to choose your travel management style. Along with this, you also need to determine your level of strictness.
These two factors will help ensure that all parts of your policy are in line with each other. They will help when making decisions regarding individual rules, tools, and more.
5. List down what to include in the travel policy
After working through your travel management style and strictness, start brainstorming what you want to include in the document. You can use an old travel policy or a successful one from a competitor as a reference for what to and not to include.
6. Create the first draft
Finalise the list of things your travel policy needs to have, then start writing the first draft. There are templates available online that may help make finishing this stage easier and faster.
7. Implement the travel policy
Expect your first draft to go through several revisions. However, once the final version has been approved by the management, make sure to share it with the whole company.
Immediate, company-wide implementation and briefing on how any travel management tool you use is necessary to encourage adoption and full compliance.
A Detailed Dive into the Writing Process
The outline we provided is only a brief look into what you should expect to do for each step. In the following sections, we will dive deeper into what each step would entail.
Review Your Current Travel Practices
What travel policy do you currently have in place? If you don’t have one, what are your employees’ travel practices? Answering these questions will help you get a better idea of what works, what employees prefer to do, and what to avoid.
It is best to do this with your company's major stakeholders, including the HR department, finance, and upper management. Having a few frequent business travellers join in the meeting would also prove helpful. If not, then asking your employees to answer a survey regarding your travel rules or practices may be a suitable alternative.
Set Your Policy Goals and Identify Stakeholders
A smart travel policy requires clear priorities and goals. These will give your writing purpose and steer you in the right direction. Additionally, it’s important to define the accepted business travel purposes so that all employees understand why it’s necessary and when they may be expected to go.
It’s also important to identify and notify your stakeholders. Ask yourself, who are the people whose input is necessary for the project? Who are the people whom your travel policy would affect?
Here is a list of people who should be involved in the creation of any travel policy:
- Human resource department
- The finance department (specifically the CFO and controller)
- CEO and COO
- Travel manager
- Office manager
- Frequent business travellers
These people are the most important ones to include in the discussions. They can either help write the document or be involved in its approval. After holding a kick-off meeting to establish priorities and goals, you can simply reach out to the stakeholders individually to minimise any disruptions in their regular duties.
A 3-Step Guide to Setting Future-Proof Priorities
Referring to your old travel policy (or your competitors’ if you don’t have one) will help you determine your priorities.
Step 1: List down what works in your teference travel program. This can be as simple as “travel expenses are exceptionally high in X city” or “employees still book flights or accommodations out of policy.”
Step 2: Set clear core goals. We recommend having two to three core goals for updating or creating a corporate travel policy. An example of a core goal could be “to meet the needs of a growing company or team.” Under each core goal, you can list down secondary or specific priorities.
Here are several basic travel policy priorities that most businesses share:
- Limit unnecessary travel expenses
- Improve transparency and visibility
- Boost employees’ travel autonomy
- Increase overall efficiency and satisfaction of business trips
- Reduce employee confusion
- Streamline manual work for the HR and administrative departments
- Improve traveler safety and duty of care
- Boost travel policy compliance
- Improve convenience in making travel arrangements
Step 3: Discuss upcoming changes in the business. Doing so will help you future-proof your travel policy, at least to a certain extent. Important changes to take note of include office consolidations, expanding to new locations or offices, hiring more people, and any potential long-distance business partners.
Ensure Every Employee Can Use the Travel Policy
There are two ways you can create your company travel policy. These are:
- Classic or traditional method: Providing employees with a hard copy or a PDF document of the policy handbook, a link to an intranet page, or publishing it on the company’s internal wiki page.
- Automated or in-app method: Customising a travel management platform according to your policies and providing access to the employees. This allows the company to automate business travel booking arrangements in real-time.
We also recommend combining these two methods. Having an easily accessible app automates the process but having a classic corporate policy document gives employees something to refer to in case they have questions.
Aside from publishing it internally through a company wiki page or intranet page, it’s also common to provide employees with a link to a shared file folder or PDF via cloud data services, like Google Drive for example.
Additionally, it is a good idea to provide new employees with either a hardcopy or digital file during the onboarding process.
All About Travel Management Platforms
One way to make sure that everyone in the company can use the travel policy you create is by using a travel management platform.
A travel management platform or system, also called corporate travel management software, helps improve travel coordination and booking processes. It is one of the most convenient ways to manage travel arrangements internally.
Instead of spending more time manually planning trips across different websites or platforms, you and your employees can simply use one system to manage everything. This includes finding the most affordable flights, the best accommodation locations, and even arranging reimbursements for canceled or missed flights.
We highly recommend choosing a travel management tool like Locomote (shameless plug) that allows you to incorporate and or create your travel policy in its system. This helps ensure automatic policy compliance.
Decide on the Travel Management Style and Strictness
It’s crucial to determine your travel management style and level of strictness before listing down what you want and need to include in the document.
Travel management style refers to how you want to structure your corporate travel arrangements. This essentially means deciding on whether to have a hands-on or hands-off approach.
Will an administrator or manager handle all the bookings? Or will you give employees the freedom and autonomy to choose their travel arrangements? Will the employees be allowed to extend official business trips to mix it with personal or leisurely travel?
As for the level of strictness, this mainly refers to the restrictions set on your chosen booking tool or travel management software.
For example, will the system still allow employees to make bookings outside of your set policies? Will they need a manager’s approval to do so? Will you require approval for all travel arrangements they make, even those that follow the company’s policies?
In deciding the style and strictness level, it’s crucial to seek the opinions of your stakeholders. The company executives, HR department, and Finance teams have the most say in this case.
Figure Out What to Include in the Travel Policy
So, what exactly goes into a corporate travel policy? It’s simple: anything and everything employees might want or need to know about traveling — both domestically and internationally.
Remember, the goal in building a business travel policy is to provide employees with a helpful reference in case they have questions. Here is an overview of some basic rules and modern guidelines:
Booking and Approval Process
- Who makes the airline and hotel bookings?
- What are the requirements for travel approval?
- What tools or platforms should employees use?
- What type of travel insurance do employees get?
- Who is your duty of care vendors?
- What are your emergency procedures?
- Who is your employees’ point of contact in the company in case of travel emergencies?
- What is the maximum allowable spend per night?
- Are there different budgets for different cities?
- How can employees get corporate hotel rates when booking by themselves?
- Are employees allowed to book alternative accommodation, such as AirBnB?
- What types of alternative accommodation are allowed?
- Are there circumstances where alternative accommodation is not reimbursable?
Airline Travel Expenses
- What is the maximum allowable spend per domestic flight?
- What is the maximum allowable spend per international flight?
- Can employees book flights without approval?
- What is the required minimum amount of time to book in advance?
Ground Travel Expenses
- What are employees’ options for ground transportation?
- What are the company’s preferred modes of ground transportation?
- Is there a maximum cost per train ticket?
- What are the rules for renting vehicles?
- What are the rules for using personal vehicles?
- Are employees entitled to fuel and accommodation reimbursements for multi-day drives?
Food and Daily Allowance
- Will daily allowance be provided?
- What will it include and not include?
- What are the daily allowance limits?
- What counts as client entertainment?
- What is the maximum cost per entertainment ticket?
- How much can employees spend without needing approval?
- What is the maximum spend per meal for clients?
- Until when can employees file for reimbursements?
- What purchases or expenses count as non-reimbursable?
- Who approves reimbursement claims?
- How should the reimbursement claims be submitted?
- How do employees submit expense reports?
Leisure Trip Extensions
- Does the company allow “bleisure” or business leisure travels?
- What counts as business leisure trip extensions?
- Will the company shoulder accommodation extensions?
- Will employees continue to receive an allowance during leisure trip extensions?
Create Your First Business Travel Policy Draft
The key to creating a business travel policy that employees would find helpful and gladly follow is to always put the employees’ needs first.
Moreover, make sure you take into account the current size of the company and its expected growth in the following years. Although the company may be limited to business trips to neighboring cities or states, for now, a fast-paced growth may require international travel in the following year or two.
As such, it’s important to try to include policies for everything the employees may experience in the future. Future-proofing your business travel policy allows you to keep it for a longer time and avoid rewriting it each year.
Get feedback from different people after finishing the first draft. If there are points that need to be revised, do so before submitting the first draft for management approval.
It’s normal for travel policy drafts to go through several rounds of revisions. Don’t be disheartened by these. Instead, use it as an opportunity to improve the policies and get actionable feedback from the people who would eventually use them.
Implement the Business Travel Policy
Once the travel policy is approved by the company executives and other stakeholders, you can start to share it with all the employees. We recommend having a town hall meeting to introduce the new policies and brief employees on the most important points.
Another way to improve policy implementation and compliance rates is by providing all employees with a copy of the document. You can do this through a company wiki page, an intranet page, a shared folder or file on the company cloud platform, or a printed booklet.
But how can you ensure employees will read the document?
The best tip we can give to boost policy read-through rates is to include the reimbursement information in the travel policy document. Everyone loves free stuff — and reimbursements count!
Including information that employees genuinely care about in your business travel policy increases the chances of them reading through the whole document.
How to Create an Automated Travel Policy in Locomote
After creating or updating your travel policy document, make sure to create an automated version, too. This is what will boost your travel policy’s compliance rate and further improve employee freedom and autonomy.
Locomote is one of the best business travel management platforms in the market. Our award-winning technology allowed us to help large and small companies streamline their travel programs.
Using our system, travel managers and employees can book, manage, track, and report in one convenient platform, globally.
Now that we’ve guided you on how to build a travel policy document, you can use it to set up an automated travel policy using the Locomote.
Benefits of Using Locomote
Locomote offers a wide variety of benefits for both businesses and employees, including the following:
- Clean and modern user interface
- Easy to navigate mobile app
- Transparent pricing
- Offers group booking
- Dedicated 24/7 travel support at no extra charge
- Allows employees to book their trips
- Real-time data reporting
- Per department budget limits
- Integrates with expenses or finance management tools
- Accepts multiple payment methods
In today’s post-pandemic world, business and leisure travel can still be quite tedious. As infection rates go up and down, and cities and states react accordingly, responding as fast as possible are necessary.
That is exactly what Locomote provides.
Using our platform, travel managers can easily make adjustments based on new travel restrictions and pandemic rates.
You can also adjust the settings based on the data our platform collects from all the travel bookings and costs reported.
How To Cut Travel Expenses Using Automated Travel Platforms
Thanks to our clients and their thousands of employees that use Locomote, we were able to gather enough data and find more ways to help businesses like yours cut down on travel costs.
- Booking flights at least a month or farther in advance if possible
- Providing access to low-cost airlines or carriers, such as Jetstar, EasyJet, Spirit Airlines, and more
- Offering flexible booking rates for easy cancellation or changes
- Setting caps for hotel costs and daily allowances
- Providing options for streamlined account reconciliation
All of these are possible through Locomote. Together with our per-trip pricing setup, exclusive rates, and discounts, companies can save up to 34% in total business travel costs.
Improving Your Corporate Travel Experience
Better business travel management equals a smoother overall travel experience. Help your employee travellers feel more empowered by giving them freedom while also optimising your travel policy.
See how we can optimise your travel program and make your company more efficient.
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