A complete guide to corporate travel management

Corporate travel is an integral part of operations for businesses of all sizes, whether it’s to attend conferences, meet with clients, or visit remote offices. However, managing the logistics of booking flights, hotels, and ground transportation can be daunting.

How do you manage all of that while keeping costs in check? Corporate travel management provides a structured way to simplify business travel.

In this article, we explore the world of corporate travel management, examining its complexities, key strategies for streamlining the process, and ways to maximize cost savings while ensuring employee safety and satisfaction.

What is corporate travel management?

Corporate travel management (CTM) is coordinating and optimizing all aspects of business travel. It's a comprehensive approach that includes setting travel and expense (T&E) policies, booking business trips, managing travel costs, and ensuring employee safety while on the road.

Corporate travel management includes:

• Travel policies: Developing guidelines for employees
• Itineraries: Arranging, scheduling, and booking employee travel
• Accommodations: Booking stays in hotels or AirBnbs
• Transportation: Booking flights, car rentals, and other transportation
• Costs & Compliance: Negotiating the best rates with travel vendors
• Support: Ensuring traveler safety through implementing risk management practices
• Reporting: Managing business travel expenses, reimbursements, and reporting
• Data Analysis: Analyzing travel data to identify cost-saving opportunities

Ultimately, the main purpose of CTM is to make business travel as smooth as possible for employees, while keeping costs under control and ensuring travel supports business goals.

The importance of corporate travel management

Effectively managing corporate travel is essential for several reasons:

1. Cost control

Business travel is a major expense category for many companies. A structured corporate travel program keeps costs under control in several ways. First, it leverages purchasing power to negotiate discounted rates with airlines, hotels, and other vendors. Second, it allows companies to set and enforce travel policies that prevent overspending and budget overruns.

2. Team productivity

A well-run corporate travel program simplifies employees' travel experiences, allowing them to focus on their trip’s business objectives. With pre-arranged travel, they can avoid the nightmare of last-minute bookings. Automated processes reduce administrative overhead, and having support available lets them hit the ground running once they arrive.

3. Employee safety

When employees travel for business, their safety and well-being is the company's responsibility. This "duty of care" obligation is a major part of corporate travel management. It involves rigorous risk assessment protocols, providing travel advisories and alerts, facilitating emergency assistance if needed, and prioritizing traveler security overall.

4. Compliance with travel policies

Most companies have internal policies that govern booking procedures, preferred suppliers, expense limits, and more for business travel. An effective travel management program is key for clearly documenting and ensuring employees follow those policies. This helps maintain compliance with both internal guidelines and relevant external regulations.

5. Data and reporting

Corporate travel management programs provide valuable reporting and analytics capabilities by centralizing all travel data—bookings, expenses, supplier usage, and more. With insights into travel patterns, spending trends, and overspending areas, you can optimize travel programs over time.

Who manages business travel?

Procurement, finance, or operations departments typically manage corporate travel within an organization. The scope and structure of corporate travel management can vary based on the company’s size and the volume of business travel required.

Large enterprises with substantial travel needs may have a business travel management team. This team is typically led by a corporate travel manager who coordinates across finance, HR, and other departments to implement travel policies, negotiate with suppliers, procure travel management software, and ensure compliance with travel regulations and duty of care obligations.

In smaller organizations, travel management responsibilities may be shared among multiple roles within the finance or operations teams or assigned to a single employee..

What is a travel management company (TMC)?

A travel management company is a travel agency that handles travel planning and booking for other businesses instead of using in-house resources. These organizations have specialized travel booking systems, access to better rates thanks to strong relationships with travel providers, and extensive industry knowledge.

TMCs offer round-the-clock support for travelers who encounter issues during their journey. They also provide analytics on travel expenses, allowing companies to track expenditures and identify areas for improvement in their travel program.

What does a corporate travel planner do?

While the travel experts at TMCs can be valuable partners, many organizations also have dedicated internal resources to manage their travel programs. This is where the role of a corporate travel planner comes in.

A corporate travel planner oversees all aspects of a company's business travel planning. Their main job is to ensure employees can easily book business trips while managing costs and enforcing the company's travel rules. They often wear many hats, from negotiating deals with airlines and hotels to helping employees book complicated itineraries.

One of the most challenging parts of the job is creating and enforcing the company's travel policy. Travel planners have to balance convenience and ease of booking with the company’s travel budgets and expense management needs. They must also stay current with the latest travel technology and other tools to improve efficiency.

Components of a corporate travel management program

A well-structured corporate travel management program is essential when employees travel for work. By combining clear policies, helpful technology, and ongoing support, you can ensure business travel is as smooth as possible for everyone involved.

Let's break down the key pieces of an effective business travel program:

Travel policies

A well-defined corporate travel policy provides guidelines for booking trips, submitting expenses, getting approvals, and other travel-related procedures. The foundation ensures everyone is on the same page and playing by the same rules. When policies are clear and cover all the bases, it's easier for the company to keep costs under control.

Online booking tools

These websites and mobile apps let employees book their flights, hotels, rental cars, and other travel needs while following company travel policies. These self-service tools streamline the booking process while enforcing policy guardrails.

Expense management software

With expense management software, employees can keep track of expenses, like meals, taxis, and other costs while traveling. These tools integrate with corporate credit cards and accounting systems, making it easy for employees to report expenses, get reimbursed, and keep everything organized. Automating expense reporting and approval saves time and reduces errors.

Policy enforcement

This is about having automatic checks to ensure employees follow all company rules when booking trips and submitting expenses. Anything that looks suspicious or violates the policy is flagged for closer inspection. This helps keep spending under control and ensures the policy is enforced fairly across the company.

Vendor management

This involves negotiating deals with—and evaluating the performance of—airlines, hotels, rental car companies, and other travel suppliers. Effective supplier management leads to better rates and terms, and regular review helps optimize preferred vendor lists.

Challenges of corporate travel management

Managing corporate travel isn't all smooth sailing. Companies often face significant challenges when trying to run an effective travel program, which can include:

Cost control and policy compliance

One of the biggest challenges is managing travel spend. With the cost of flights, hotels, and other travel expenses constantly fluctuating, it can be tough to stick to a budget. Setting clear policies that outline spending limits can help, but getting employees to follow those policies is another challenge entirely. It often requires a lot of communication, education, and sometimes even enforcement to ensure everyone is on the same page about travel spending.

Difficulty tracking approvals

Another common challenge is managing expense approvals. Many companies have a lengthy approval process that involves multiple people signing off on travel plans before employees can book their trips. This can lead to delays and frustration for travelers, making it a real headache for travel managers to keep everything moving. Streamlining the approval process can significantly improve the program’s overall efficiency.

Managing expense fraud

Unfortunately, expense fraud is a real problem in many companies, and it can be especially tricky to catch when it comes to travel expenses. Employees might exaggerate expenses, claim reimbursement for costs that aren't within company policy, or even submit fabricated receipts. This kind of misreporting can add up to significant losses over time. Robust expense management software can flag suspicious activity and help prevent fraud before it happens.

Integration issues

Another big hurdle in corporate travel management is organizing all the data flowing in from different parts of the travel process: online booking tools, expense reporting software, invoices from travel suppliers, corporate credit card systems, and more. Without the right tools, putting all that data in one place so you can use it to improve your program can be a real headache.

Logistical inefficiency

Even the basic logistics of corporate travel can be hard to manage, especially when you're dealing with many employees traveling at once. Getting everyone to use the company's booking tools correctly, making sure traveler profiles are up to date, and keeping your various processes running smoothly can be a full-time job in itself. These kinds of inefficiencies can be frustrating for managers and travelers alike, and finding ways to simplify things is an ongoing battle.

5 tips to manage business travel effectively

1. Create a clear and easy-to-follow travel policy

The first tip is to have a travel policy that lays out your guidelines in a way that's easy to understand. This policy should cover:

• How to book trips
• What kinds of expenses are allowed
• How to report expenses
• The approval workflow process

Make sure the policy is easy to find and access. Review it regularly to keep it up to date with any changes in the company or the travel industry.

2. ​​Improve efficiency with technology

Investing in the right travel management solution can streamline processes and save time. Online booking platforms and expense management software can automate many tasks and make it easier for employees to make their own travel arrangements. If you can’t bring on a tool, use corporate cards to keep tracking and reimbursement as simple as possible.

3. Build strong relationships with travel vendors

Building strong partnerships with suppliers like airlines, hotels, and rental car companies can yield better rates and customer service. Negotiate favorable contracts and establish preferred vendor programs to get the most value. Regularly evaluate supplier performance and be open to making changes to ensure you're getting the best deals and meeting your business needs.

4. Emphasize communication and education

Effective communication ensures everyone understands and follows the company's travel policies. Provide regular training and updates and encourage open feedback to hear travelers' concerns and suggestions. The more engaged and informed employees are, the smoother the travel process will be. This will also help them feel they have 24/7 travel support while away.

5. Use data for continuous improvement

Business travel generates a wealth of data you can use to identify areas for improvement. Regularly analyze spending patterns, policy compliance, and traveler feedback to spot real-time trends and issues. Use this data to make informed decisions about policy changes, supplier negotiations, and program enhancements.

Ramp: A modern solution to corporate travel management

Ramp offers everything you need to improve your corporate travel management process. Combining travel booking, expense management, AP automation, and financial reporting allows you to control costs, improve efficiency, and simplify your tech stack with a single solution.

Simply input your T&E policy, and Ramp Travel will handle the rest. We pull compliant flight and hotel options into a single dashboard for employees to book. Our integrated expense management platform collects data on every business travel expense made with our corporate charge cards for real-time expense tracking and automated expense reporting.

Corporate travel doesn’t have to be a headache. Try Ramp and see why customers save an average of 5% a year.