More and more employees are going off the beaten track of their company's travel policy when it comes to booking business trips or services. So, why do business travellers use open booking? What should travel managers be doing in response to this fast-growing practice?
Open booking – whereby employees go elsewhere to book their transport, hotel room and hire car, as opposed to making use of the company's pre-negotiated offers with service providers – is riding on wave of popularity for several reasons:
- Initially, the rise of the sharing economy contributed to the development of reservation and service channels, which made it possible to obtain rates or offers that were often more favourable.
- The next phase saw comfort-seeking employees feeling the need to customise their trip and/or to avail themselves of more intuitive tools than the ones offered by their company.
- Finally, certain employees see the system provided by their company as cumbersome and out-of-date. Indeed, according to a survey carried out by FCM Travel Solutions in June 2018, only 9% of business travellers said they use the online booking tool provided by their company for the majority of their trips. This percentage is rather low, making it even more difficult for a company to control its travel policy. Whilst 59% of the travellers surveyed said that their company does provide them with this kind of tool, 25% were of the opinion that the system needs to be improved.
Because of its extent, this phenomenon poses a threat to the existing economic model of travel management, which relies on data exchange between buyers and vendors to obtain competitive rates. This is why 32% of companies have toughened their travel policy by making it less flexible in terms of reservation channels, according to a survey
conducted in 2015 by Acte Global
, an international travel manager association, and American Express Global Business Travel
, travel management solution provider.
According to the survey 'Creating a frictionless travel experience
' conducted by Sabre and GBTA in EMEA regions (Europe, Middle East and Africa), 41% of travellers admitted to having already booked a trip outside of the company-authorised channel to make the experience less stressful. More precisely, this concerns 28% of plane tickets and 50% of hotels, according to another survey conducted by GBTA with the support of Concur.
The challenge for travel managers is to strike a balance between their interest and that of business travellers, all the while keeping the company's travel policy under control. This is also what other providers are aiming to do, like Concur with the TripLink application. The perk of this app is that it lets travel managers approve or reject an employee's request to add a particular vendor to the supplier network.
Indeed, it is no use banning open booking, the principle behind the app being that trips – no matter the chosen booking method – must comply with the company's travel policy and be incorporated into the system so that travellers benefit from the offers that their company has negotiated with vendors, whilst also making it easier to track and monitor employees for their safety.
The scope of the travel manager's task not only entails satisfying and guaranteeing the comfort of their business travellers. There is another objective that is even more ambitious than data management, one in line with their expense management objectives
: to anticipate all travel-related expenditure to be able to determine their TCO (Total Cost of Ownership). This total cost, in addition to direct costs, takes account of all indirect costs, such as technological developments and the human resources mobilised. The TCO is therefore a key piece of information to be able to analyse the financial viability of a business trip.