Money On The Table

Professional Buying Decisions (Managed) vs Amateur (Unmanaged)

The headline for this section may sound a little harsh. Or perhaps arrogant. But those who manage travel or TMCs helping corporations manage travel have seen it all before. It’s the difference between teams of individuals with many years of experience and tools to help manage travel and expense, versus someone with an app on their mobile taking the lowest price flight. And I used the wording ‘lowest price’ rather than ‘cheapest’ as the lowest price isn’t always the cheapest. The lowest price may not have optimal services to lower the overall cost, like perhaps allowing for changes. 

Many Options For Individuals

Online travel agencies, airlines, and hotels all push consumers to their channels through various promotions and advertising. Some with perks and benefits to entice the traveler to buy with them. The challenge is that those perks usually do not help those who are actually paying for corporate travel: the corporation/employer.  That perception of value for leisure travel seems to migrate to business travelers but it may not be in their company’s best interests. 

Companies often will negotiate for better deals based on their spend with a supplier (airline, hotel, car rental). However, if those bookings are not well-accounted for or if the company cannot influence their travelers to change, then they have no opportunity to negotiate whether to reduce pricing or obtain benefits from those suppliers.     

Those companies also need to be mindful of their Duty of Care. They are responsible for the well being and safety of their employees while traveling. If their employees book outside of authorized channels, it leaves the company without knowledge or visibility in the case of an emergency.  

Managed vs Off-Channel/Rogue Bookings

The pandemic may have set us back in terms of well managed programs, or at least made it more difficult to have compliance in those well managed programs. The good habits within those programs may have been forgotten during the pandemic as people had to exchange the pleasures of connecting with people face to face with “sorry, you’re on mute” conversations. For the last 16 months, we either haven’t traveled for business or traveled minimally. Because of that, many may have forgotten that it’s best to stay with the preferred means of booking travel.  

In certain areas of corporate buying, the employer has conformed (in a way) to the employee. For instance, there are very few of us reading this article from a Blackberry. It’s an example where the individual’s productivity on their preferred device outweighed the security perceptions of corporate IT departments. It might be that employees feel that they can do a better job managing travel costs than a corporate policy. Some are well intentioned, trying their best for their employer and making buying decisions that are best for their employer. And sometimes others are looking to get some perks for themselves. Some employees want experiences as part of their travels, even in corporate travel, and this often occurs off-channel which could be fine but because the travel is initiated by the employer, there is still an element of Duty of Care to the employer. 

Additionally, outside of actual cost in dollar value, a number of companies since the pandemic have increased their awareness around sustainability. Booking off-channel will not provide any visibility to corporations on their impact of CO2 consumption and reduce their impact to be more responsible in corporate sustainability.

2022 And beyond

While it may take some time for business travel to rebound, it may take longer for employees to have the same good habits as they did in the past. However, for those corporations that struggled with effective travel policies, this might be a great time to recalibrate, reevaluate, and reset those behaviors within their organization.  And for the most part, it might simply be a question of providing more information and tools to employees to remind them that corporate policies are not only created to ensure the traveler’s safety and comfort - but to help company profitability too.

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