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Business Travel is Here to Stay
Advances in communication may have given you the impression that business travel is actually on the way out -- nothing could be further from the truth. While it is true that a lot of out-of-town meetings can now be avoided due to the availability of video conferencing, some modes of doing business still require the handshake and personal touch.
The Global Business Travel Association underscores this point of view. In its 2009 business travel report, the Association details that “face-to-face meetings are an essential part of building successful business relationships;” this is true even in a floundering economy. Nevertheless, American companies are spending less on business travel. In 2009, the funds allocated to company travel reached $234 billion, which represents a 10.3 percent decline when compared to the figures from the prior year.
With an estimated return of investment equaling $15 for each travel dollar spent, is curtailing really the right answer? The answer must be a resounding ‘no.’ Instead, a sound policy governing all corporate travel may accomplish what a red pen to the budget’s bottom line can never manage: smart spending.
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1. Establish Boundaries
International travel is expensive, but crucial for a global corporation. It stands to reason that only executive-level staff undertake these trips. Consider the rationale for the trips as well; it pays to have decision-makers head out internationally, since they have the power to move business negotiations forward. National travel may be opened up to general management staff, if needed. Local travel -- usually within the reaches of one gas tank -- can be opened up to staff members at the supervisory level.
Be sure to also address the number of employees who may travel at any given time. Ensure that project management is not adversely affected by the absence of too many key players. On the flip side, do not hamper support personnel by taking too many decision makers out of the office at any given time.
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2. Name the Travelers
Limit travel privileges to seasoned workers who have a proven track record with the company. Be clear in differentiating between full-time and part-time workers, seasonal staff and cross-training employees. Include in your policy if you are willing to offer travel privileges to exempt or non-exempt workers. It is vital to spell out the inability to accommodate spouse, partner or dependent child travel arrangements. Sure, a worker could still bring -- on his own dime -- a wife and child for an overseas trip to Germany, but if the company has a policy specifically forbidding any corporate involvement in these plans, it also cannot be held liable for any mishaps, missed connections or lost luggage.
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3. Who Pays?
Generally speaking, there are two options: Up-front pay or reimbursement. Sending off the worker with a company credit card or petty cash can lead to lax fiscal restraint. Reimbursing the worker -- up to a stated per-diem amount -- for invoiced incidentals forces the employee to be frugal and document each penny spent. Not surprisingly, employees are not too keen on the latter. This is exacerbated by sluggish reimbursements and prolonged invoice review times. If your business does opt for a reimbursement policy, make sure to place a five to seven business day limit on resources managers to okay original invoices and expense sheets.
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4. Limit Liability
Note which travel agents, airlines, rental car companies, eateries or insurance carriers the traveling employee may use. If the worker goes outside these parameters, make it clear that the business is not responsible for the charges incurred. Spell out the presence (or absence) of a travel insurance policy that covers the worker’s physical wellbeing. Be sure to include information about legal problems the employee may encounter, such as traffic tickets or arrests -- this not only helps you as an employer, but also makes for a better business trip for the employee who is welladvised from the start. A worker, who agrees to hold a company harmless from any damages related to legal costs, will have a difficult time suing later on to recoup attorney’s fees or ticket costs. Furthermore, ensure that travelers understand that it is the company’s policy to comply with local law enforcement and applicable laws.
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5. Standardize Authorization Processes
If there are just you and a few workers, it is easy to oversee the company’s travel. Fast forward to five years from now, and you may be located at a headquarter office with five satellites in different states. Suddenly oversight is not all that easy anymore. So go ahead and define early on the types of circumstances that warrant travel authorizations, who makes these determinations and also who verifies them. Institute an authorized party for in-the-field personnel to call on if there are questions or a need to deviate from standard travel policies.
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A business travel policy that can grow with a business is of value for the company and its workers. Antiquated procedures frustrate workers, while outdated accommodation allowances make the business look cheap. Remember: Letting your workers travel in affordable style not only forges good relationships with other business entities, but it also goes a long way to ensuring increased staff retention.
- Global Business Travel Association, http://www.gbta.org/Lists/Resource%20Library/Business%20Travel%20Report%209.15.09.pdf
- Photo Credit: “Suitcase made with cloth material” by Mk2010/Wikimedia Commons via GNU Free Documentation License, Version 1.2