INSIGHTS

Out-of-policy travel (and it's impact on your bottom line) 

Half of UK business travellers book outside company policy, driving up costs and undermining negotiated deals. This article breaks down where and why employees go out-of-policy — and how travel managers can shift behaviour through compliance strategies rather than enforcement.

According to a recent survey conducted by the Global Business Travel Association (GBTA), half of UK business travellers (52%) make a travel choice which does not follow their company’s stated policies.

This results in a significant impact on the cost of travel and also has the potential to undermine negotiated deals dependent on achieving targeted volume. Furthermore, future savings are at risk through diminishing an organisation’s ability to leverage volume to drive better rates in future.

There is also an additional impact on productivity with those who went out-of-policy reportedly spending more time making their reservations than those who followed policy.

Where do employees go out of policy and why?

 

  • Business travellers are somewhat more likely to use the company preferred method of booking plane/train tickets than they are of using the preferred method of booking a hotel
  • They are willing to go out-of-policy to stay the hotel of their preference. When costs are equal and the personal preference hotel is not on the company’s preferred list, more than half (56%) would go out-of-policy and choose their personal preference.
  • Of travellers who go out-of-policy on flights, 71% would go out of policy to take a direct flight with a non-preferred provider. At a £30 cost increase half (47%) would still go out of policy and a quarter would still make the same choice with an £60 increase.

Out-of-policy hotel behaviour: the most common violations

When staying at a hotel, business travellers go out-of-policy in a number of ways:

  • Ordering room service – 24%
  • Staying at a non-preferred hotel 13%
  • Getting in-room entertainment 11%
  • Staying an unnecessary extra night 10%
  • Staying at a more expensive/higher-class hotel 8%
  • 39% of these travellers state the choice is for personal reasons.

With business goals at risk, even marginal shifts in non-compliance can have a significant impact on your bottom line. Your FCM account manager will already be working with to analyse out-of-policy behaviour through exception and missed savings reports. While some companies choose to impose some method of disciplining non-compliance, more and more are working with us to firstly identify the reasons behind the behaviour and creating and implementing initiatives to foster a culture of support rather than ‘using a big stick’ to enforce policy.

How FCM can help you improve travel policy compliance

There are two key areas where FCM can help you address the challenge of out-of-policy bookings:

  1. Are your travellers really clear on the benefits of policy compliance, not only to the company but to themselves?
  2. Putting in place strategies to bring to life the features and benefits of the travel product within your policy and even get them excited about it through site visits or supplier days.

If you are concerned about compliance and would like to discuss some alternative ways to cultivate more support from your travelling staff, call your Account Manager to discuss the options. 

Want to drive compliance? Let's talk.

Loading...

FAQ

  • What is out-of-policy travel? 

    Out-of-policy travel occurs when an employee makes a booking that doesn't follow their company's travel policy — for example, choosing a non-preferred hotel, booking a direct flight with a non-preferred carrier, or ordering room service beyond the agreed allowance.

  • Why do employees book out of policy? 

    The most common reason is personal preference — 39% of out-of-policy travellers cite this as their motivation. Convenience also plays a role, particularly for flights where travellers will pay a premium for a direct route.

  • What is the cost impact of out-of-policy travel? 

    Beyond the direct cost of more expensive bookings, out-of-policy travel undermines volume-based deals negotiated with suppliers, reduces an organisation's leverage for future rate negotiations, and adds time to the booking process.

  • How can companies improve travel policy compliance? 

    The most effective approaches focus on communication and culture rather than enforcement — making sure travellers understand the benefits of compliance, and using supplier days or site visits to generate enthusiasm for the preferred travel products.