You’ve crafted a great travel policy and shared it with all your travellers. You’ve negotiated hard to get good deals in a tough market. You’ve put all your preferred suppliers on your booking engines.
Yet, you still have staff staying at non-mandated hotels and flying on non-preferred airlines. Welcome to the world of leakage.
Almost all travel programs, no matter how big or small, suffer from “rogue” behaviour; people using airlines and hotels outside of policy. And often, they think they’re doing the organisation a favour and getting better value.
This behaviour, especially if it gets out of hand, can have serious consequences:
- generally costing you more – even if travellers think they’re buying cheaper
- undermining your supplier contracts and impacting on your rates and discounts
- making it harder to track your travellers in case of an emergency
- complicating your accounting processes
- undermining your relationship with suppliers, including your TMC
Does your organisation suffer from leakage?
There are estimates that up to half of hotel bookings are made outside of corporate programs and booking tools. These probably don’t even show up in your reports. The first step is to check how much leakage you have, using your expense reporting tool and comparing approved travel with actual spend data.
How can you contain leakage? You can probably never eliminate out-of-policy travel altogether (there are legitimate reasons sometimes to do so), but here are some tips to at least help limit that behaviour.
If travellers don’t know what’s permitted and what isn’t, they can’t be expected to do the right thing. So it’s vital to have a comprehensive policy that details preferred suppliers, class of travel, etc. But it’s even more important to communicate the policy and make sure anyone who travels is familiar with it. Highlight the need for visibility should something go wrong and urgent help is required.
Mandate or buy-in
Mandating (or forcing traveller behaviour) is an effective approach, but one that is going out of vogue. Many organisations prefer to encourage “buy-in” - getting travellers to embrace the policy and willingly follow it. Your approach will be determined by your organisational culture.
Online booking tools (OBTs) are now commonplace and should be configured to make it easy for travellers to use. Remember that everyone is now an ‘expert’ online booker of leisure travel, so your OBT must be at least as easy to use as the leisure tools.
Prioritise preferred suppliers
Make sure your chosen hotels and airlines are the first thing travellers see when they hop on the OBT. Some organisations choose to “hide” non-preferred suppliers, but with everything now available somewhere online, you can’t fully prevent travellers from seeing the alternatives.
Use pre-trip approval
Make sure that any out-of-policy bookings are flagged early in the booking process and follow up promptly. Of course, that doesn’t help when bookings are made outside the system.
Encourage good choices
Many organisations use peer pressure to curb rogue purchasing. It may not be appropriate to name repeat offenders publicly, but at least make sure their superiors are aware of ongoing transgressions.
Get management on side
Although senior executives are often the worst culprits, by educating upper management about the negative effects of leakage, you can secure their buy-in and support.
Co-opt your suppliers
Enlist the help of your suppliers. Ask for their help to make it easier for travellers to do the right thing.
Use loyalty programs
Frequent flyer programs and hotel loyalty schemes encourage certain behaviours. This can be frustrating when travellers are rewarded for out-of-policy choices, so ensure that your travellers are signed up to the right programs. That way, you’re all pulling in the same direction.
Keep watching and remain vigilant
Unless you keep on top of compliance, leakage may reappear from new hires or through new travel options like the rapid growth of disruptors like Airbnb and Uber.