Decoding key elements, tips & tricks for effective corporate travel policy

Decoding key elements, tips & tricks for effective corporate travel policy

Never underestimate the value of a well-crafted corporate travel policy. A strong travel policy should be non-negotiable for smooth corporate travel management, especially for multinational companies operating out of Singapore with regional travel complexities, frequent travel demands, and diverse teams. 

A corporate travel policy is not just about booking flights or hotels. It is about optimising processes, achieving business traveller satisfaction, driving cost-effectiveness, while identifying room for improvement. For procurement heads, travel managers, and bookers, an efficient business travel policy improves workflows with an employee-friendly framework that supports business goals.

In this guide, we delve into why a corporate travel policy is essential, its key components, common pain points, and strategies for creating a thorough policy.

Decoding business travel policy

Think of corporate travel policy like an instruction guide for a board game. Every rule, dos and don’ts, and rules for different players are described. Likewise, corporate travel policy is a go-to document which enlists clear guidelines to be followed by different personas- travel managers, bookers, arrangers, business travellers and other key stakeholders.
Your corporate travel policy defines all the processes, right from booking business trips, approval process, employee expenses, to emergency protocols, and other documentation within these processes.

For instance, while mentioning travel guidelines in the corporate travel policy, you can mention how early should employees start with travel arrangements (air, hotels, car, insurance, etc.). Your company's travel policy can put a spending limit on bookings for both employees and VIPs, or give a more structured approach to reimbursable expenses.

Understanding the need for clear policies

Without a well-defined corporate travel policy, corporate travel management can become chaotic. Your business travellers can book last minute trips despite days of advance notice. It is possible to lose track of frequent travellers during disruptions, and there won’t be any accountability. When processes take a hit, it can be expensive, risky, and leave you with no data for insights. Here are a few reasons why a corporate travel policy is required:

1. Cost savings & track expenses

A corporate travel policy sets limits on airfares, hotel categories, meal allowances, and more to control costs and overspending. This helps procurement and finance teams track spending and negotiate better rates with preferred suppliers. It also helps plug expensive and unnecessary travel spend.

2. Improved compliance and accountability

Multinational companies need consistency across other locations. A centralised policy, tailored with local flexibilities, ensures teams across geographies follow the same travel standards, promoting fairness and clarity in expectations.

3. Duty of care and traveller safety

Employee safety is paramount. A travel policy supports duty of care by ensuring employees book through approved channels and have access to support in emergencies. It also helps track travellers in real-time, which becomes important in times of medical issues or disruptions.

4. Consistency across global teams

Multinational companies need consistency across other locations. A centralised policy, tailored with local flexibilities, ensures teams across geographies follow the same travel standards, promoting fairness and clarity in expectations.

5. Streamlined booking and approval workflows

A smart business travel policy defines how travel should be booked. Whether via a travel management company, different vendors or self-booking, and who approves it. This removes ambiguity, reduces delays, and empowers travel bookers and managers to act swiftly.

6. Better data for better decisions

Structured corporate travel policies result in clean, consistent data. This helps in analysing trends, identifying savings opportunities, and building more effective supplier strategies to achieve business goals. It also enables meaningful reporting for finance, HR, and C-suite decision-makers.

7. Supports sustainability goals

A modern policy can include sustainability as well. For instance, the policy can talk about reducing carbon emissions via air travel or selecting eco-friendly hotels. This helps companies align travel with their Environmental Social and Governance goals and report on carbon impact

Listing not-to-be-missed company travel policy elements

Whether you are creating a new one or just refreshing the corporate travel policy, here are some key components you should incorporate in the document:

1. Define the purpose

Your company's travel policy document should state the objectives of the policy, whether it is for first-time business traveller, frequent travellers, or VIPs, clearly mention the personas in the policy, type of travel- domestic or international, and the processes.

2. Booking processes

Define how and where business travellers should book, through a travel management company like FCM, self-booking or via travel managers. Besides, it’s worth mentioning the window for advance booking for business travellers. 

3. Preferred suppliers

Add a list of approved airlines, hotels, and car rental providers and ask your travellers to book through them. This step will help you to maximise costs through negotiated rates.

4. Travel approvals

If a traveller books a business trip, who’s going to approve it? Define who needs to approve trips and from whom. Also, mention the approval process, time, and what happens in emergency scenarios. Here, online tech tools like FCM Platform can help with smooth approvals through emails/notifications.

5. Travel and expense management

When your employees hit the road, they are going to spend on stays, meals, cabs, etc. Your travel policy should include the spending limit on different line items and mention steps for reimbursement.

6. Duty of care

 Detail how your company will protect employees abroad, including emergency contacts, travel insurance, and location tracking.

7. Payment methods

Include corporate cards, virtual cards, or central billing accounts that streamline expenses and reduce fraud.

8. Sustainability guidelines

If reducing carbon footprint is your organisation’s goal, encourage employees to book eco-friendly hotels, check carbon emissions during air travel, etc.

9. Exceptions and escalation procedures

Travel policy compliance is an ongoing activity. To avoid non-compliance, list down escalation processes if someone makes an out-of-policy booking, books travel last-minute, and anything that doesn’t fit your organisation’s ethos.

Common mistakes to avoid and keep employees happy

Even though the goal is to have a structured and consistent policy, always keep travellers at the centre. Your policy should be flexible and agile to make adjustments. Here are some common mistakes you can avoid

  • Overly rigid rules that frustrate travellers
  • Too much jargon
  • Lack of clarity on exceptions
  • Ignoring local market nuances
  • Failure to update regularly with market and tech changes
  • Not emphasising traveller experience and safety
     

Ensuring travel policy compliance from key stakeholders

Once you have introduced a new/renewed travel policy, what about the results? How do you ensure policy compliance? Awareness and training.

A policy is of no use if your employees are not aware of it and don’t follow it diligently. Everything begins by educating travellers, handholding them during the initial stages of adoption, and listening to the feedback. For instance, training sessions, awareness programmes, regular meetings, etc., can go a long way.

That said, it is also essential to remind and track compliance. Travel technology tools such as the FCM Platform send notifications whenever employees make out-of-policy bookings. Such bookings get notified to travel managers, bookers and arrangers, who can identify missed savings opportunities.

Unlocking smarter ways of corporate travel management

A smart corporate travel policy is more than just a rulebook. It covers all the cogs of the corporate travel programme wheel. As global business travel is expected to accelerate, now’s the perfect time to revisit your policy and align it with the future of work.

FCM Travel in India can help you shape a policy that works locally, scales globally, and keeps your people moving safely and efficiently. 

Take your travel programme to the next level. Talk to our experts today.

By proceeding, I agree to the website terms of use and to my personal information being handled in accordance with the privacy policy.