Report: Cost-Conscious Business Travel Programs Have Hidden Costs

A new report from Airlines Reporting Corporation makes the case that more flexible travel programs can pay for themselves by ensuring road warriors are happier with their jobs. Programs that aren't flexible, on the other hand, could be pushing employees out the door.

Could a heavy focus on the bottom line turn corporate travel into a chore?

That’s a big concern highlighted in a new report from Airlines Reporting Corporation (ARC), along with American Express Global Business Travel and tClara. The report, based on a survey of more than 750 business travelers, makes the case that programs focused on cost over the employee’s productivity and comfort level make the business trips less effective overall. The report found that business travelers in cost-conscious programs took 22 percent fewer effective trips than their counterparts and were 13 percent more likely to be interested in a new job.

“Tough, tight travel policies have significant business costs,” tClara Managing Partner Scott Gillespie stated in the report [PDF]. “You’ll save money in the travel budget, but you’re buying less effective trips and causing more frustrated travelers.”

Part of the problem involved issues of comfort and timing: Business travelers in cost-focused programs said they were likely to sleep much better at home (82 percent), struggled to keep a healthy lifestyle on the road (74 percent), worried about impacts on their personal life (72 percent), and felt that they had little advance notice when traveling. With the exception of sleep quality (at 53 percent), respondents in traveler-focused programs generally said they ran into these problems less than 40 percent of the time.

The report made the case that these sorts of issues created problems that could affect an organization’s ability to hold on to employees who heavily travel.

“Assigning an exact cost to traveler friction is difficult, but a business’ road warrior attrition rate can help corporate travel managers quantify the impacts of travel program policies on talent retention,” the report stated. “Attrition rate can also become a powerful tool in communicating priorities with senior management.”

But even in programs that are focused on controlling costs, there is room to make travelers happier. The survey suggests that business travelers are interested in relatively modest asks, such as more nonstop flights, better seats on the planes, less frustrating expense reporting, reimbursed airport lounge membership, and access to programs that ease the airport security process, like TSA PreCheck or Global Entry.

“Basically, they want more productivity,” Gillespie explained.

The full report is available at the ARC website.


Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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