30 October 2017 | Charlotte Lamp Davies
Corporate Travel Policy Alive and Kicking as Seen at DataArt’s Question Time Event in New York City
Building on the continuing success of organizing industry debates, DataArt hosted its 7th annual Question Time Event, in New York City on October 26, 2017. Titled “Is Corporate Travel Policy Dead?” the evening brought together senior travel executives for an open debate on the topic of business travel policy.
Jay Campbell, Journalist & Co-Founder of The Company Dime, expertly moderated the discussion, developing arguments, guiding the conversation and engaging the audience. He was joined on the panel by Andrew W. Menkes, Founder & CEO of Partnership Travel Consulting; Cynthia Shumate, Senior Manager of Travel & Meetings at Regeneron, and Board Member at GBTA; Daniel Ruch, Founder & CEO of Rocketrip; Dee Runyan, President of World Travel Inc., and Greg Abbott, SVP of Travel & Hospitality at DataArt.
Greg Abbott kicked off the discussion by noting that very little has changed in the business travel industry since the 1990s. Dee Runyan observed that, historically, travel policy has been ‘draconian’, ‘black and white’ with few ‘shades of gray’. She also noted that there is now more focus on the traveler than ever before.
There was general consensus that Corporate Travel Policy is very much alive. Dan Ruch commented that “policy guidelines are a fundamental part of any well-architected program. Human beings need guidelines, and this is just behavioral science, but within those guidelines there is a huge amount of room for optimization.” The challenge is how employees are going to behave within those guidelines. He added that around a quarter trillion dollars a year is largely spent at the discretion of travelers. The big question, according to Ruch, is how to get travelers to “behave in ways that are optimized, not only for their interest but also for the organizations they work for.” He later pointed out that incentives are a great tool.
Cynthia Shumate also spoke of travel policy as foundational for the well-being of an organization, providing direction and setting expectations for decision making and behavior in the travel aspect of business life. She believes that 90% of employees want to be compliant but that specificity is important. She described how she had just rewritten a heavy-handed travel policy with hard stops, controls, and approval requirements for small items. The new policy allows the traveler to use technology to book what he or she is seeing on the screen without encountering disruptive requests for approval. “There is a trusting factor there within a technology and we just use it and allow it to take us where we need to go.”
Dee Runyan cited a study in Voice of the Traveler finding that the least happy travelers are those without a policy or rules to follow because “if you don’t know the rules of the game, how do you play it?” Travelers want to be rewarded and compensated.
Andrew Menkes emphasized the need for relevance. “Travel policy is like the bill of rights. At the time it was written it made sense to the people who crafted it. But unless you keep it current and address your demographic it’s an old sheet of paper that no one is going to pay attention to.” He also emphasized that compliance should be as much an area of focus as the policy itself.
While the panelists agreed on the fundamental importance of travel policy, there were different perspectives on the form it should take.
Cynthia Shumate noted the importance of communication for ensuring compliance and the need to use all available channels to engage people with different communication and learning styles. Dan Ruch countered that he does not see poor communication as a problem: “Companies don’t have a problem communicating policies, companies have problems creating policies that appeal to the people they are designed to control. No sales guy has ever failed to understand their commission plan. Same thing with your vacation policy, bonus programs.” “The problem is that travel policy is not listening to the travelers,” he continued. According to Ruch, travel managers are effectively set up to fail because their interests conflict with those of travelers. “They are hired to mitigate risk and control cost. So the path of least resistance is to implement a strict policy that everybody can follow. That works to an extent and controls about 50-60 percent of the bad behavior.” The problem, he pointed out, is that strict policies don’t account for the interests of travelers, who are usually the people who generate the most revenue and therefore eventually get their way. For Ruch, lack of education regarding the benefits of travel policy is the real issue.
Picking up on this point, Greg Abbott commented that travelers’ individualistic behavior is caused by them not understanding the trade-off and the ‘why’ of the policy. He sees an increasing role for technology in communicating the ‘why” to employees.
Dan Ruch also argued that treating travel as a straight line procurement product is a mistake. He believes that travel has a vital emotional aspect and that simply negotiating rates from the vendor procurement perspective will not suffice. “When you are asking employers who are married who have kids who have loved ones to go out on the road and leave their house at five in the morning and go and sleep in a different bed, away from the people they care about on your behalf- the equation flips and emotions take over.”