What growth hackers know about business travel

In a fast-growing organisation, managing business travel often gets pushed down the list of priorities. Founders, directors, and CEOs of companies enjoying rapid growth are more focused on growth than they are on the costs of travelling. But a managed business travel program, including a travel policy, can help toward growth hacking your company.

Companies may report revenue and costs, but the difference between the two — profit — is key. If you’re a fast-growing company, don’t look only at the costs of business travel, but at the difference between your investment in it and the value it can generate.

Look at more than the cost of travel

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Business travel as an investment

Business travel is an essential element for growth. A study commissioned by the World Travel and Tourism Council (WTTC) concluded that “business travel... yields a return on investment of 10: 1” and that “if business travel were cut by 25 percent over two consecutive years, global GDP would be 5 percent lower than would otherwise be the case after a five-year period.” 1

Companies that don’t currently manage their business travel need to make it part of their business plan.

A quickly growing small to medium business or fast-growing company may have already introduced a managed travel program to organise the increased need to travel. This is a good start, but an understanding of the broader benefits of travel management can yield greater benefits, especially for fast-growing companies.

Take for instance the fast-growing software business Splunk, which increased their headcount by 55 percent in the last two years. Joy Anzinger, senior manager of global travel, said “Growth is challenging, and we need to pick technology that fits our culture. A lot of new technology is not scalable for us. A lot of great new players may fit our culture but are not scalable for us. We’re picking technology for where we will be in five years.”

Company cultures vary so no standard template exists. Travel programs’ objectives, priorities, and delivery for companies with

complex decision-making processes and extensive rulebooks can be very different from those with flatter structures.

Fare savings are just the tip of the iceberg.

Start-ups and fast-growing companies, whether they’re growing organically or through mergers and acquisitions, can also negotiate fare savings from leveraging the volume of trips they book, as well as enjoying further advantages such as refunds from unused tickets, and efficient reconciliation and payment.

Travel programs need to deliver these benefits at a minimum, but organisations can gain so much more.

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The importance of data

Big data isn’t just marketing jargon. Ninety percent of all data has been created in the last two years — 2.5 quintillion bytes per day.2 Capturing that volume of data is a very different matter from identifying the right data metrics for analysing your challenges and producing solutions.

Travel data can be about much more than the number of trips taken, fares, and room rates paid and, as a business grows, how and which data is collected and analysed should change. For example, when a business is new, the business travel bookings will usually be done by one person on their favourite website.

As you scale up, choosing one booking channel — and a user-friendly booking tool — is an extremely efficient way to pull together consolidated data that can be used to reveal insights into travel patterns and behaviour.

Booking tools that deliver data visualisation are invaluable. These tools can take data and transform it into a report that clearly communicates to stakeholders and staff which cost savings or improvements to employee well-being might result from small changes in bookings or behaviour.

The company-wide benefits are endless.

It’s about data — I need that data to leverage our spend, but most importantly to provide duty of care.

“

“

— Joy Anzinger, Splunk

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For example, collecting data on individuals’ total air travel time can alert managers as to who might need time off. Likewise, numerous car or rail journeys for business can also wear down employees. Monitoring this and compensating those who are traveling excessively can aid traveller satisfaction, safety, productivity, and help retain top talent.

“It’s about data — I need that data to leverage our spend, but most importantly to provide duty of care,” Anzinger explained. “It allows us to know where our travellers are — relocate them, rebook them, etc. [There was] an active shooter outside the woods in front of the Seattle airport. I had two employees headed there, so I sent them both a note about it, changed the flight on Egencia, turned Uber around.”

Any tool you choose should integrate easily and quickly into your tech stack to increase efficiency across the company, whether it’s finance’s need to manage staff expenses or HR’s ability to locate employees.

Getting the most out of business trips

Business travel is usually seen as a company’s second largest controllable expense after salaries. But controlling costs is not the same thing as cutting expenditure. It’s all about getting the best logical fare or room rate — in other words, the best price for the travel choice within policy. This ensures that employees can have the best possible trip, positively affecting their well-being and productivity.

There are indirect benefits, too.

A travel program doesn’t automatically mean central control and lack of traveller choice. Managed travel programs play an important part in the trend for more traveller centricity in trip decision-making.

Travellers want to manage their itineraries from their devices, in the office, or on the road. Flights are missed. Travel plans change. Travellers want the ability to change flights themselves on any device, with instant visibility into any potential fare increases or penalties.

Greater traveller involvement means more engagement and awareness, ensuring travel programs and travel policy can be adapted to support a company’s culture. This kind of brand reinforcement is important for attracting customers and prospective employees.

This paper will focus on three additional advantages: Travel’s role in recruitment and retention, how travel can support company culture and promote diversity, and how it can increase a customer-centric outlook with employees.

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The importance of an effective recruitment and retention strategy

Management guru Peter Drucker said, “The most valuable asset of a 20th-century company was its production equipment. The most valuable asset of a 21st-century institution, whether business or non-business, will be its knowledge workers and their productivity.” 3

This is still true.

Business author Stephanie Vozza wrote about the cost of losing an employee in Forbes and the cost (in addition to any recruitment fees) to a company — QPRE, the quantifiable revenue per employee — of losing that employee. She said a crude measure of QPRE would be “to divide your entire annual revenue by the total number of employees on your team. For example, if your annual revenue is $5 million and you have 25 employees, each employee is worth about $784 per day.” 4

With numbers like that it’s no wonder that Kronos and Future Workplace® found that 87 percent of employers believe that improving employee retention is a priority for their organisation.5 Other benefits of staff retention are more difficult to quantify, such as team spirit, customer confidence, and loyal, content employees.

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Successful companies are increasingly creating strategies to improve their staff recruitment and retention rates whether it’s updating the workplace, offering greater compensation, or improving traveller well-being.

The organisation’s business travel policy is a great place to start.

Using business travel policy to support recruitment and retention

Opportunities for business travel can give an organisation a competitive advantage in recruiting top talent. The quantity and quality of that travel can be critical in retaining those employees.

The Society for Human Resources Management (SHRM) believes that travel policy is a factor that organisations need to address if they want to improve their recruitment and retention rates:

“HR departments and organisations invest significant resources into designing benefits packages that can be used both to recruit new employees and to retain the talent they already have. In a SHRM survey on job satisfaction and engagement, the clear majority (92 percent) of employees indicated that benefits are important to their overall job satisfaction.

“Results also showed a relationship between benefits and retention, with 29 percent of employees citing their overall benefits package as a top reason to look for a position outside of their current organisation in the next 12 months; 32 percent of employees who were unlikely to look for an external position cited their overall benefits package as a top reason as well.” 6

Despite this, SHRM’s annual survey found the number of organisations offering fundamental benefits such as compensation for airport parking fees while on a business trip had decreased.

of employees indicated that benefits are important to

their overall job satisfaction

92%

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Employee benefits

5-Year Change 2014 2015 2016 2017 2018

Transportation and Insurance

Reimbursement for taxicab or car service to and from the airport 84%

88%

79%

37%

13%

70%

8%

70%

54%

30%

13%

4%

5%

70%

19%

13%

3%

5%

2%

3%

3%

<1%

<1%

0%

87%

89%

82%

39%

13%

72%

9%

69%

55%

37%

14%

4%

5%

70%

20%

17%

4%

6%

4%

3%

3%

1%

<1%

<1%

87%

88%

79%

41%

16%

76%

11%

68%

58%

33%

14%

3%

4%

67%

17%

13%

4%

2%

2%

1%

1%

1%

1%

<1%

87%

87%

80%

40%

15%

76%

9%

66%

59%

36%

14%

4%

4%

65%

14%

12%

3%

2%

1%

1%

1%

1%

1%

1%

81%

87%

82%

36%

12%

84%

12%

71%

64%

35%

13%

3%

4%

74%

15%

11%

3%

2%

1%

1%

1%

1%

<1%

<1%

Parking reimbursement at the airport while on business travel

Mileage reimbursement for the use of a personal car to travel to and from the airport

Travel accident insurance

Rental car upgrades

Meal and Snacks

Per diem or reimbursement for meals

Paid minibar snacks at the hotel

Hotel and Services

Employee keeps hotel points

Paid Internet access while on business travel

Reimbursement for personal telephone calls while on business travel

Paid dry cleaning while on business travel

Hotel and Services

Employee keeps frequent flyer miles

First or business class airfare for international travel

First or business class airfare for international travel

Paid airline club membership

Paid pay-per-view movies at the hotel

Paid health club fees while on business travel

Hotel and Services

Paid travel expenses for spouse

Paid travel expenses for dependent children

Paid travel expenses for opposite-sex domestic partner

Paid travel expenses for same-sex domestic partner

Paid child care expenses while on business travel

Paid elder care expenses while on business travel

Paid pet care expenses while on business travel

The Society for Human Resources Management: 2018 Employee Benefits Survey

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Letting their executives travel at times that are most convenient for them is a benefit that all fast-growing companies should consider offering. But Egencia’s survey of business travellers found this to be what nearly a third of all travellers cared about most.

The Egencia survey also found that for 32 percent of employees the top priority was booking direct flights. These flights sometimes cost more, but they save time and avoid employee burnout.

Additional industry research also indicates the importance of having a traveller-friendly strategy.

A study by the Global Business Travel Association (GBTA) found a strong correlation between business travel and traveller well-being: “79 percent of business travellers in North America say their business travel experience impacts their overall job satisfaction at least somewhat.” 7

Egencia’s survey confirms this. Wendy White, vice president of marketing, said, “The days of mindless cost cutting out of a travel program are now gone. While travel managers are still expected to deliver savings, the stakes are now much higher. Company culture, employer brand, capacity to attract and retain talent — these are key to the growth and success of companies. The modern travel manager knows that and will set the travel program to play a determining role in shaping the company culture.”

Not all travel policies are created equal. Consider what employees like or don’t like about travel if you want to attract and keep the best and brightest.

However, the importance of business travel doesn’t stop with recruitment — digital natives expect to be involved in decisions that affect them.

“I want people to feel free to do what they need to do for business,” Anzinger explained. “I trust them to know what they need to do for business, knowing [they] value Splunk and their job.”

of employees’ top priority was booking direct

flights32%

of business travellers say their travel experience impacts overall job satisfaction

79%

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Culture and diversity

Fast-growing companies typically don’t see diverse teams as a challenge to be managed, but as a positive benefit. Paddle.com, which ranks sixth on Deloitte’s list of the 50 fastest growing companies, said that “we passionately believe that a diverse team builds a better product.” 8

Diverse workforces will have travellers with varying objectives, tastes, and needs that travel programs will need to support. Some employees will be attending conferences that have been planned in advance while others will be asked to see a client on a moment’s notice. Some travellers want to get home to a new baby as soon as possible, while others are keen to take some bleisure time. Accessibility factors will need to be considered for travellers with physical disabilities. Frequent travellers will be confident in managing their own itineraries, but others may rely on the 24/7 support that TMCs and their tools can provide.

Start-ups often have a high number of entrepreneurial employees who may resist travel programs because they like to make their own travel decisions.

“Corporate travel programs are sometimes a tough sell among employees, but they don’t have to be,” Business.com reported. 9

The Egencia survey also found that for 48 percent of travellers the “most important element of a travel program is the ability to control bookings themselves from initial bookings, to any needed changes — speaking to the importance of empowering travellers and providing travel management tools built for ease-of-use.”

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Growth is challenging and we need to pick technology that fits our culture.

“

“

— Joy Anzinger, Splunk

Companies also have diverse departments, some of which are relevant internal stakeholders: HR, IT, security, finance, and department heads are all interested in aspects of travel policy.

The IT department needs to ensure that the platform works as part of the tech stack. The platforms used in travel for booking, payment, and expense management should easily and cost-effectively integrate with other departments such as finance and HR.

Department managers and budget owners will know if meeting a prospect or visiting a client is worth a trip’s cost. An outsourced specialist, such as a TMC, can advise on systems that will facilitate approval before travel.

Keeping all departments and travellers content with a travel program requires regular reviews and input from all stakeholders. How can you know how employees feel about their business travel without asking? Fast-growing companies can set up a procedure to use feedback to adapt and improve travel policy. Some use private communication networks such as Yammer to let business travellers share travel experiences with peers and ideas for improvement with management.

Managers shouldn’t worry that travellers might come back and ask for first-class travel. The Egencia survey found business travellers’ priorities were more in line with established policies than you might expect: “Keeping up with daily work duties” and “making the trip worth my company’s money” were ranked second and third.

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What do you care about most when travelling for business?

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

0.0%

Travelling at times that are most convenient for me personally

Being able to keep up with daily duties

Making the trip worth my company’s money

Maintaining my well-being routine (e.g exercise, diet, sleep, etc.)

Getting personal time, finding time to explore local attractions or adding leisure travel to the trip

Other

Egencia survey: What business travellers value

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No one doubts that the cost of a sale to an existing customer is less than finding a new customer. Estimates vary but some think that it costs a company six to seven times more to get a new customer than to keep one.10 A study by Bain & Company found that “a 5 percent increase in customer retention produces more than a 25 percent increase in profit... Return customers tend to buy more from a company over time. As they do, operating costs to serve them decline... And they will often pay a premium to continue to do business with you rather than switch to a competitor with whom they’re neither familiar nor comfortable.”

Growth and change, whether because of a merger, acquisition, or organic growth, will inevitably lead to an evolution of company culture. During these transition periods, it’s crucial to remain focused on retaining long-term customers as well as attracting new ones.

Companies need to maximise every opportunity to be customer-centric.

Monitoring and analysing business travel data is vital during periods of rapid growth, which are likely to be accompanied by increased business travel and changing travel patterns. Having a business travel program that facilitates an employee’s ability to promptly respond to their customers is crucial.

Organisations often treat business travel as a fixed cost, but it could be beneficial to think of it as a direct cost linked to a specific project or objective. In this way, it can be viewed as an investment and a way to generate revenue rather than as general overhead.

For example, a service department may have set a travel budget based on the number of trips they had to book for their engineers in the previous year. Since then, the sales team may have delivered a contract that expanded the customer base by 20 percent. Should the travel manager remind the operations department to stick to the budget, or should the increase in travel spend be seen positively as a cost that needs to increase when the volume of business — and revenue — grows?

Max Altschuler, vice president of marketing for Outreach explained how important travel is to their business. “For us it’s very much something we look for ROI out of. We know what deal potential [is], how much meetings will cost, etc. We’ll spend upwards of $2,000 to get a meeting with a certain customer. So, we’ll spend that money multiple times — deals will pay, and multiply over time.”

Becoming customer-centric

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Business travel can improve customer relationships and communication — you can’t see body language in a conference call — and face-to-face meetings are widely considered to be more beneficial to client retention than talking remotely. According to Maritz Global Events, “73 percent of executives believe meetings and events have a significant impact on employee performance and 93 percent of executives say face-to-face meetings and events improve their ability to close deals.” 11

Customer centricity can be achieved indirectly by paying attention to details such as booking people into properties that reinforce the brand. For example, booking properties with fitness centers would be important for companies that prioritise employee well-being. A company that wants to be known as environmentally friendly would want to reflect this in their travel choices and their approved accommodations could be confined to properties certified as eco-friendly.

When an employee is working remotely, they’re taking the brand with them. Business travel is essentially your company’s brand on tour, offering employees the chance to show their customers exactly why their brand stands out.

“We look at it [business travel] like an election — turning red to blue, blue to red,” Altschuler said. “If we go to Chicago and don’t have a presence there, and our competitors are on the ground, we send reps to market once a month to feel like we have a local presence.”

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There’s no doubt it’s important to get a business traveller from A to B, but there’s much more to gain from adopting a managed travel program. Here are some steps that any company, regardless of size or age, can take to ensure its travel program supports corporate goals and strategy.

1. Use your TMC to get the lowest fare from A to B and the lowest total travel cost for your objective — that means taking extra costs into account, from checked baggage fees to airport transfers.

2. Ensure your travel strategy doesn’t focus only on room rate and airfare but can identify the travel and accommodations as a means of delivery that’s fit for purpose. If travellers want to book their own travel, choose a user-friendly tool that enables them to manage their itinerary while still complying with company objectives.

3. The travel program should be able to deliver total trip data, administrative needs such as duty of care provisions, and be a tool to recruit and retain the best team for your business.

4. Analyse travel data to determine what different traveller groups need. If possible, personalise the content to make the booking process easier and more attractive.

Making travel programs part of company growth strategy

5. The new generation of workers is increasingly entering a world where the distinction between leisure time and work is blurring. Construct a travel policy that takes traveller priorities, likes, and dislikes in to account. This can give businesses a competitive advantage in recruiting and retaining the best and the brightest.

6. Have an effective plan to communicate travel policy to travellers and managers.

7. Implement a plan that enables internal stakeholders to communicate their viewpoints.

8. Seek feedback from travellers to build a travel policy that reflects company culture, meets corporate objectives, and serves the diverse needs of travellers, internal stakeholders, and customers.

9. Make sure your travel policy is communicated in every recruitment initiative.

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Footnotes:1 “Business Travel: A Catalyst for Economic Performance,” World Travel & Tourism Council, 2011, https://www.treasureisland.com/images/groups/2011-wttc-business-travel-roi.pdf

2 “Data Never Sleeps 5.0,” Domo, 2018, https://www.domo.com/learn/data-never-sleeps-5?aid=ogsm072517_1&sf100871281=1

3 “Let’s Value People as an Asset, and Bring Financial Statements into the 21st Century,” Huffington Post, 2011, https://www.huffingtonpost.com/r-paul-herman/lets-value-people-as-an-a_b_1063698.html?guccounter=1

4 “What Is the Cost of Losing an Employee,” Forbes, May 31, 2018, https://www.forbes.com/sites/adp/2018/05/31/what-is-the-cost-of-losing-an-employee/

5 “The Employee Burn-out Crisis Study,” Kronos and Future Workplace©, 2017, https://www.kronos.com/resources/employee-burnout-crisis?fs=200&at=g

6 “2018 Employee Benefits: The Evolution of Benefits” Society of Human Resource Management, 2018, https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/2018%20Employee%20Benefits%20Report.pdf

7 “Business Travel’s Influence on Employee Retention, Recruitment and Results,” Global Business Travel Association (GBTA), 2017, http://blog.gbta.org/2017/10/11/business-travels-influence-on-employee-retention-recruitment-and-results/

8 Deloitte, UK Technology Fast 50, https://www.deloitte.co.uk/fast50/winners/2018/

9 “How to Deal When Employees Go Rogue Booking Business Travel,” Business.com, 2018, https://www.business.com/articles/going-rogue-business-travel/

10 “Prescription for Cutting Costs,” Bain & Company, 2001, https://www.bain.com/contentassets/2598a2341fed40eba41954ee442ead22/bb_prescription_cutting_costs.pdf

11 “Driving business value,” Maritz Global Events, 2013, https://www.maritzglobalevents.com/Driving-Business-Value

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Additional helpful resources:• Egencia’s Survey of Business Travellers 2018 (https://www.egencia.com/public/au/egencia-uncovers-what-business-travelers-value-most)

• Hidden effects of policy on traveller well-being (https://www.egencia.com/public/au/hidden-effects-of-policy-on-traveller-well-being)

• How To: Boost compliance and savings through increased business traveller satisfaction (https://www.egencia.com/public/au/how-to-boost-compliance-and-savings-through-increased-business-traveler-satisfaction)

• How To: Choose a business travel management company – don’t settle for software OR service – give your travellers both! (https://www.egencia.com/public/au/how-to-choose-a-business-travel-management-company-dont-settle-for-software-or-service-give-your-travelers-both)

• Is your travel management company future proof? (https://www.egencia.com/public/au/is-your-travel-management-company-future-proof)

• Travel expense management and the path to revenue growth (https://www.egencia.com/public/au/travel-expense-management-and-the-path-to-revenue-growth)

• Traveller satisfaction helps build strong organisations (https://www.egencia.com/public/au/traveller-satisfaction-helps-build-strong-organisations)

• 3 ways to use your travel policy as a recruitment tool (https://www.egencia.com/public/au/3-ways-to-use-your-travel-policy-as-a-recruitment-tool)

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The challenges you face today are never the same ones you faced yesterday. That’s why business travel should just be, well, easy. And that’s why there’s Egencia — the world’s leading business travel technology service. We constantly re-imagine how to give you the convenience, support, care, and simplicity you need to make business travel as easy as it can be.

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