New directions: Travel managers give policy a post-Covid makeover

When coronavirus pulverised business travel in 2020, many companies effectively adopted a one-sentence travel policy. Across Europe they communicated to employees the message that employees should restrict trips to “business-critical” purposes only.

But what does that phrase actually mean? “When we said ‘business-critical’ we meant operational: keeping our plants running, or anything to do with safety,” says Patrick Kuziw, global travel manager for BASF. “Going to a supplier meeting would not be classed as business-critical.”

Thinking a little more precisely about the semantics, what BASF and many other companies really meant, was that lockdown travel could only be for reasons critical to their business in the immediate short term. Arguably the big lesson learned about policy was that even after Covid all trips ought to be business-critical, whether for the immediate needs of the company or for more long-term viability.

“Policy has become more about making sure employees think about how and when they travel and that there is a return on investment,” says Festive Road consultant Carol Peter. “There has been a push to make sure people use virtual meetings rather than just jumping on a plane; and there is a message around travelling with intent, to make sure it is purposeful.”

In Peter’s view the biggest policy adjustment has been more emphasis on pre-trip approval. “Once upon a time there was pre-trip approval for non-compliance to policy,” she says. “Now we’re seeing approval to understand the value of that trip. Pre-trip approval has become more popular since the pandemic because companies really want to understand why their people are travelling. I think pre-trip approval is important to keep and is here to stay.”

BASF is a textbook example of the trend identified by Peter. “We’ve written into the policy that travellers should think about how and why they travel,” says Kuziw.

To assist that thinking, an intern assisting Kuziw used Microsoft Power Apps to create a decision tree. “It works on reason for travel, duration, location and cost,” Kuziw says. “The tool will then say ‘we recommend meeting virtually’ or ‘we recommend travelling for this meeting.’” If the employee does elect to travel, consent from a line manager is required.

The Denmark-based pump manufacturer Grundfos also requires pre-trip approval, although only verbally from a line manager. Very similarly to BASF, “we now have a sentence in the travel policy that emphasises considering very strongly whether you need to travel or if a virtual meeting would be sufficient. That’s the first sentence in the policy,” says senior global category manager for travel Anikó Nagy.

Line manager consent is also needed at Grundfos, though this may be given verbally. However, there are other levers to control demand. A consultancy exercise in 2020 determined that Grundfos was travelling twice as much as comparable companies. “When this was confirmed, management made a decision to cut down on the budget, so people are really conscious about their plans and already know [to be careful about when they travel],” says Nagy.

   
Businesses are adjusting travel policy post-lockdown for other reasons too. One is steering travellers back towards online bookings after a lurch towards offline during the pandemic when every trip became a complex undertaking to organise.

Now, says Mihai Dinu, global travel manager for robotic process automation software provider UiPath, the acute shortage of travel management company reservations staff is providing strong pressure for a swing in the opposite direction. “If you have online booking at this time when you can wait one hour for an agent, it could be a mess, so it’s important to encourage online booking for simple point-to-point routes,” Dinu says. “Offline is also more expensive.”

Kuziw is among travel managers addressing this problem. “Online adoption has not gone back to the level we would like because people have got used to booking offline,” he says. “We will reiterate what we need people to do. The wording has always said you should book within the travel service provider’s online solutions where possible. It’s just trying to reword that a little bit.”

Peter believes labour shortages also help make the case for adjusting policy to allow purchase of more flexible tickets. “One client has changed to allow business class because there have been a lot more flight disruptions, so it’s much easier for travellers when they want to make changes to their ticket,” she says.

Naturally, upgrading to business class adds cost but Peter draws a direct line to the growth of pre-trip approval and only travelling when truly important to the business. Consequently, while cost per trip may rise, this is offset by the number of trips falling. “It’s probably only for a short period you need to have that rule in place but if you’re going to have an ROI on the trip, then maybe it’s worth making those changes,” she argues, adding that upgrading to business class has the serendipitous bonus of helping companies fulfil their employee wellbeing aspirations.

For many businesses, however, the trend looming largest at present is not employee shortages but the growing risk of economic downturn. It is therefore very likely that some companies will turn off the travel tap off again as they did in early 2020, though for different reasons.

BASF reduced its bookings by 90 per cent when it switched to “business-critical” travel in 2020. The company is currently back to 60 per cent of 2019 levels. “By Q4 we were expecting to be back at about 75 per cent but with the current economic climate that’s not going to happen; we’re going to be hovering around 60 per cent,” says Kuziw. “Some countries have actually put in travel bans again because of budgetary constraints and the need to ensure we don’t spend too much.

“We wouldn’t write that in the policy itself. The board has said we need to reduce costs. Travel wasn’t specifically mentioned but whenever this happens travel is one of the first things to be impacted,” Kuziw says.

Many more such edicts may be issued by companies around Europe over the coming months.