Is there a business case for creating a better traveler experience?
Wednesday 12 June 2017
Article by Michael Ryan and Niklas Andreen
People tend to have a very glamorous view of business travel – flying business class, five-star hotels, lobster dinners, piling up the points, cutting epic deals. But as people who have travelled frequently for work for well over a decade, we assure you that the reality can be starkly different!
Business travel is one of the top controllable expenses for many organizations – many big American and Australian businesses spend tens or even hundreds of millions of dollars a year flying their employees around the world. And so cost management – and containment – has always been a top priority when it comes to business travel. This is often achieved by enacting more restrictive travel policies. Ask any seasoned road warrior and they’ll tell you “things ain’t what they used to be”, as they reminisce of a time before the 2008 financial crisis when they could fly business class on a three-hour flight.
No one can doubt or underplay the importance of cost management – and cost management is something most business are good at. However, more and more organizations are realizing that while crucial, it is only one dimension of their success. Leading organizations are therefore increasingly focusing on the strong business case that exists for putting the traveler experience at the center of their strategy. Data shows it improves retention, boosts performance, and even lifts the bottom line when you don’t just treat travel as movement of people, but understand how employees see this as part of your company culture.
In fact, in a recent survey of business travelers by CWT, more than three in five (61%) respondents to the survey said they factor in a company’s travel policy when evaluating a new job opportunity. This pattern is even more pronounced with road warriors who have taken more than 10 trips in the past year – close to three quarters (71%) said corporate travel policies influence their job search.
Striking the right balance between cost control and the traveler experience is the Holy Grail in business travel.
2019 is shaping up to be an exciting year for business travel because technology is reaching a point where it will, for the first time, allow companies to achieve these goals simultaneously.
The Golden Trinity of business travel – Cost, performance and traveler experience
Part of our strategy at CWT is joining the dots between many masters. We think of it as a golden trinity: the cost of travel that needs to be managed; performance – what you expect to achieve by sending someone on a business trip; and the experience your people have when they are traveling. Our industry used to think about these things in silos and also quite often see them as mutually exclusive, but it’s essential that we transform our thinking. It’s “both, and”. It’s not “either, or”.
Our focus is making sure we can define the optimal solution between the three for our clients. We know from research that successful companies are using employee engagement to drive other areas of the business: namely recruitment, retention, performance, and savings. It’s the same in the business travel sector. There’s no longer a binary effect between cost and service. It no longer has to be the case that effectively managing your program needs to result in a worse service for your travelers.
With the capabilities brought by data science, the opportunity now exists to move away from looking at the three points of the triangle separately, and instead finding the ideal mix for each company.
Here’s an example: In a past role, one of us had to fly out to Chicago for a training week. With the old rules, any flight over six hours was booked in business class. But there was no real need to fly business for that trip. On the other hand, if someone is flying two hours to make a big pitch for their company, you definitely want that person stepping off the plane fresh and shipshape, mentally and physically prepared to nail the deal. The return on investment (ROI) of an economy class ticket which leaves them stuck in the middle seat in row 52G, with a kid drooling on their shoulder on one side and a loquacious co-passenger on the other, is probably not great. Data science can help us design better travel policies which factor in more context about each trip, allowing business travelers and their companies to get more bang for their buck.
Of course, the challenge is we all have data coming out of our ears. It’s not always easy to know what to do with it. But companies that can truly understand what their data is telling them about the traveler experience they are generating, will have the power to develop systems that allow you to run a very cost-efficient travel program, as well as build a brand that resonates with your travelers.
Getting the green light from the C-Suite
Our industry has been talking about the traveler experience for a long time, but historically companies have struggled to put an ROI on it. Now, technology is at a point where the data exists to make a well-rounded business case: To show how the travel program can drive the culture of who we want to be as a business, generate savings, and achieve both a financial and organizational ROI.
The challenge now is how organizations change the conversation internally.
How do I engage with my travelers? How do I make a business case to start talking internally about this shift from just talking about cost – the binary – to defining what a holistic approach looks like?
Successful companies who are pivoting the conversation to a strategic and holistic view of travel aren’t trying to boil the ocean. They aren’t looking to technology to solve a problem immediately, or as a one-off solution. This is because by the time you have solved your current problem, there will be new ones.
Successful companies know where they want to head, understand the importance of the travel program in their company culture, and have figured out how to move the needle step-by-step while also taking their travelers along for the journey.
What’s exciting is that more and more organizations are saying, “We can accomplish all three objectives – costs savings, better performance and an improved traveler experience – simultaneously.”
We are now all asking: “What’s the actionable insight?”, “What can we start to change today?”, and “How can I make sure I service and engage travelers better across all the channels we use to interact with them?”
Once travelers have the right tools, they change their behavior naturally. If an employee is able to book a trip the way it best suits them – whether that’s through a mobile app, on a computer, or picking up the phone and speaking to an agent – and they’re offered an easy, efficient and personalized experience, they will have little reason to break the rules. You will then have fewer discussions around increasing compliance to corporate travel policies. Instead, the discussion will be around how you help travelers get the most out of the tools you provide.