Corporate travel and expense management policy and practices have garnered attention from across the enterprise, with everyone from CEOs to CIOs looking at how T&E can promote growth, cut costs, boost efficiency and productivity, and enhance insight into the company via data analytics.
It’s a huge area of spend for businesses, meaning it’s a huge opportunity to cut costs and make a real impact on the bottom line.
Indeed, in the latest research by Amadeus released today (Monday, Sept. 18), analysts found that CEOs are prioritizing growth when considering T&E management, while other C-level executives also see travel and expense management as an opportunity to achieve their own goals for the enterprise. But in some ways, Amadeus found, companies are missing opportunities to make headway with those goals.
For instance, 95 percent of companies surveyed permit out-of-policy travel booking, which can lead to a lack of transparency in how employees are spending company money. Further, 80 percent of those surveyed said they did not have access to enough spend data for more strategic T&E sourcing, and 60 percent admitted they lacked sufficient tools for adequate T&E demand management.
Dr. Alexander Grous, lecturer in the Department of Media and Communications at the London School of Economics and author of the report, along with Arlene Coyle, COO of Corporate Solution Sales and Marketing of Business Travel at Amadeus, both spoke with PYMNTS about the research, and admitted there were a few surprises in the data.
For Dr. Grous, the results on how many organizations allow employees to book out-of-policy travel, combined with the high percentage of survey respondents who noted they don’t have enough insight into spend, is a troubling trend.
“It’s almost a contradiction between, ‘I don’t understand why I’m not getting the full picture,’ but at the same time, I’m much more flexible than the policy, and I allow employees to book travel without capturing [the data],” he said.
There are simple technologies that can address these issues, he added.
A corporate card program, for instance, may be considered a more basic piece of payments technology that can enable a company to capture spend data for T&E programs. But according to Amadeus’ report, while two-thirds of survey respondents said they had some type of commercial card program in place, only about 15 percent were actually in use, and only 10 percent of that total represented mandatory use of a corporate card for corporate travel.
There certainly are clear benefits to a corporate card program, as users of the tool outlined in Amadeus’ report. For instance, the integration of a corporate card program with existing accounting and T&E platforms means automated capture of spend data, and also enables a greater ability to analyze spend behavior and data.
Amadeus’ Coyle, though, said it was “one of the most surprising things” to find that there is a significant lack of use of corporate card programs for travel booking. Considering some organizations’ inability to track spend, it is interesting that businesses aren’t using an integrated corporate card program more often, she said.
“I would have assumed that the majority of companies would be using a corporate card to manage travel,” she noted. “That’s one of the big awakenings for a number of readers of the study.”
Some enterprises may feel that initiating a commercial card program may not be worth the time, money and energy, considering a significant portion of companies are willing to let employees book travel with personal cards and file expense reports later. But according to Dr. Grous, the opportunity to capture spend by integrating a corporate card program (and actually using it) is one of the low-hanging fruits the report identified.
The corporate card is certainly not the most cutting-edge technology to offer enhanced corporate T&E programs, but it can certainly be useful. Whether it’s a commercial card or the latest software, technology is now a critical component of effective expense management programs.
Today, she said, there is a “traveler-centric perspective” on technology, with solutions designed to be accessible on multiple devices while travelers are on the go, facilitating features like mobile receipt capture and automating data capture and analytics on the back end. But these tools must be deployed appropriately.
“Automation can validate or weaken a T&E program,” she warned.
Luckily, Amadeus‘ report found evidence that companies are eager to adopt technology. Ninety-four percent of executives surveyed said their top booking-related priority is to facilitate mobile booking, while 0 percent said expense data extraction capabilities are top-of-mind for expense-related tools.
With T&E innovations centered around the corporate travelers themselves, there is another trend in the enterprise that Dr. Grous said highlights the progress the industry is making.
“On a very positive note, employees have a much stronger voice now in corporate travel,” he said. Members of other aspects of the enterprise, like HR and IT, are now “sitting at the table with CEOs, COOs and CPOs” to discuss T&E strategy, a phenomenon he said wasn’t seen only a few years ago.
Coyle, too, saw a reason to be optimistic about companies’ evolving T&E strategies, despite Amadeus’ research revealing some obvious areas for improvement.
“I was very pleasantly surprised to see in this study that there is an interest and engagement across all levels into travel,” she said. “There is recognition that it is not the function of just one department to be responsible for T&E. It’s a fantastic message to get across.”