Focusing on Value When Making Decisions About Business Travel
Business travel is an intricate web of decision-making, and both travelers and procurement leaders often find themselves having to balance costs with quality service. For procurement leaders, the emphasis of these decisions often tilts toward cost reduction.
While focusing on costs is a critical part of the travel procurement process, travel managers find themselves in the unique position of ensuring business travelers are comfortable while they are on the road. As such, business travel leaders must also focus on quality when making purchases and defining travel policies.
This article provides insights on prioritizing value in business travel decisions.
Why Value is Essential in Business Travel Decision-Making
According to a report by travel industry news site Skift, budget cuts are already leading to "business travel tension" within companies in 2024.
Specifically, "As organizations hammer out their business travel plans and policies for 2024, another year of budgetary caution will become a source of rising tension with employees,” said Amy Padgett, vice president, of travel marketing strategy for SAP Concur in a statement. "Although budgets may increase, doing more with less in response to inflation will remain the organizational mantra of 2024.”
This suggests that companies are facing a delicate balance between managing costs and maintaining employee satisfaction while engaging in business travel. Value should be at the forefront of decision-making.
In the context of business travel, "value" means acquiring high-quality services from vendors and travel companies at reasonable prices. This definition implies that procurement leaders and business travel managers must make decisions that prioritize both cost and quality.
Thankfully, achieving this is not impossible. Next, we'll explore some of the ways procurement leaders can focus on value in their business travel programs.
Key Components of Value-Focused Business Travel
Value-focused business travel goes beyond just getting the best rates for flights and accommodation. It involves a comprehensive approach that considers various aspects of the travel experience, ensuring that business travelers receive the quality they expect at budgets that make the most financial sense for the organization.
Build Strong Relationships with Vendors
One way to achieve this is to build relationships with vendors who understand your company's specific needs and can offer tailored services. For instance, partnering with a hotel that offers flexible check-in and check-out times could potentially increase the productivity of employees who arrive early or depart late.
Leveraging Travel Management Technology
Another aspect of value-focused business travel is implementing technology solutions. Utilizing travel management software can streamline the booking process, provide real-time updates on travel costs, and allow for a more personalized travel experience.
Prioritizing Traveler Comfort and Satisfaction
It's also essential to prioritize traveler comfort and satisfaction, as these directly influence the success of the business trip. This means providing employees with adequate allowances for meals and incidentals and ensuring they travel at comfortable times.
Travel managers can also create a standard where business travelers are surveyed about their experiences after they return from a business trip. This will help them generate insights about the organization's current travel policies, as well as its purchasing decisions, and how they add value to the travel experience.
Balancing Quality and Costs When Accessing Travel Services
Naturally, cost concerns can't be set aside completely when attempting to create a more valuable business travel experience. Procurement leaders must therefore strike a balance between value-added travel experiences and cost-reduction measures.
Here are some steps leaders can take to achieve this balance:
- Negotiate bulk discounts with favored vendors: Procurement leaders can leverage the volume of their business to negotiate discounted rates with airlines, hotels, and car rental companies that travelers say provide valuable service. This allows them to reduce costs without compromising service quality.
- Incorporate flexibility in travel policies: Allowing employees some latitude to make their own travel decisions can lead to greater satisfaction, and often, cost savings, as employees may opt for less expensive options if they provide more convenience or comfort.
- Invest in traveler risk management: Ensuring the safety and well-being of employees on business trips can help avoid unexpected costs related to emergencies, thus protecting both the traveler and the organization.
- Review and revise travel policies regularly: Regular review of policies enables leaders to make adjustments that reflect changes in the market, traveler preferences, and organizational priorities, ensuring a balance of cost efficiency and value.
- Institute a rewards system for cost-conscious behaviors: Encouraging employees to make cost-effective travel decisions through a rewards system can lead to significant savings while also enhancing traveler satisfaction.
- Engage in regular vendor performance reviews: Regular assessments of vendor performance can ensure that they continue to provide high-quality services, and any issues that might affect the value derived from their services can be addressed promptly.
These are all cost-conscious ways of perfecting the business travel program so it continues to provide a valuable experience to travelers.
Add More Value to Your Business Travel Program
While budget cuts may continue to be a source of tension in business travel, procurement leaders can navigate these challenges by prioritizing value-driven decisions. Ultimately, it comes down to recognizing that value is not just about getting the lowest price; it's about striking a balance between cost and quality to ensure both the organization and its travelers benefit from the travel program.
To learn more about how you can add value to your business travel program, don't miss ProcureCon Travel 2024. It’s happening at the Marriott Tech Center in Denver, Colorado from June 3rd to June 4th.
Download the agenda and register for the event today.