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Security 21st November 2019 - 6 min read

Why do finance directors hate the travel category?

By Joni Lindes

It is the end of another month. Time to submit your programme spend reports to senior management, finance directors or business unit budget owners. Only problem? You have not submitted it yet and are not even close to finishing it.

This is a typical situation, and is not the travel team’s fault. Poor travel and expense data quality standards, time-consuming data analyses and the fact that data, in itself, is sometimes alienating to senior stakeholders all contribute to the issue. As such, there are three major challenges when it comes to promoting the travel management’s company profile: travel and expense reporting figures are inaccurate, reporting is late and the data itself is alienating.

The three major challenges to achieving improved stakeholder relationships

1. Reporting figures are inaccurate

There is a reason why travel data needs subject expertise when it comes to dealing with it. It is complex, full of inaccuracies and is inconsistent. Most players in the industry have little incentive to change this. As such, data discrepancies often arise.

TMC data is often thought of as adequate, yet TMC reports miss a massive part of the picture. After all, they can only go on what is booked through their channel. This means that a budget vs actual figure is difficult to come by if we are leaving out ad-hoc expenses placed on credit cards or expense reports.

As a result, travel category reports almost always have incorrect figures if we compare it to the money leaving the bank account. We all know incorrect figures are a quick way to lose credibility with finance directors.

2. Reporting is late

In a 2016 survey, conducted by Amex GBT and Business Travel News, senior management leaders were quizzed on how often they receive reporting from travel managers.

Frequency of data reporting to stakeholders

 

The results show reporting frequency to be incredibly varied. Other categories, however, tend to report at least monthly and on a prompt and regular basis. In many businesses, data for other categories is available live (or at least up to the end of the previous day).

Unlike travel managers, most categories have a linear pattern of spend. They choose their suppliers, decide on a budget, and report on what is actually spent. This is easy to do as the manager holds the purchasing decisions. In travel, as we all know, the travellers decide on what they spend and, most inconveniently, how and where they spend it. Off-channel bookings are a common occurrence which makes it difficult to mitigate risk and reporting becomes hard to do.

An analysis on data from all TMCs, payment cards and/or any other payment solutions used in a programme takes time. This data exists in a variety of standards that may not work well with each other and needs further consolidation, enrichment and cleansing. Hotel properties, for example, often have different names according to who is processing the data. This makes it challenging to map it correctly and come to a complete figure when you are demonstrating demand for each property, for example.

Sometimes you may be lucky enough to have a team of analysts digging deep into the data and taking on this task yet sometimes you may even be rolling up your sleeves and doing the work yourself.

This process takes weeks – taking travel managers away from doing important work in the programme. Given as the job title is travel manager, not travel reporter, this is not ideal.

Finance directors therefore see travel as a “flakey” category by default.

3. Even when reports are submitted, they are seldom ever read

A travel manager submits a report on traveller behaviour to a business unit leader only to find that they don’t remember it or haven’t read it in the first place. This is a common occurrence.

This time it’s not finance directors and procurement leaders that have issues. They are often comfortable with figures, numbers and reports. The rest of the company may not be quite so comfortable. This becomes an issue when we want to drive better travel programme engagement or promote more compliant traveller behaviour.

Many P&L owners or business division leaders are not data analysts and, most would agree that a report with rows of numbers is not something we look forward to first thing in the morning. Reading a long travel policy document is also not awe-inspiring which makes it difficult to enforce.

How can we change this?

Finance directors and procurement do not hate travel, rather they just recognise it as a complicated category – a challenge they need to deal with. Instead of allowing the challenge to defeat us, a newer approach to stakeholder engagement may be needed.

1. It all starts with the data.

The common problem here is the fact that, whenever communication or reporting is done, the figures are late and/or wrong. Walking into meetings with finance directors with only a promise to deliver the report in two weeks does not look good. The same can be said for data that is immediately shot down as incorrect.

Even though the data remains complex, the systems used to manage it have become smarter. Computer processes can match data automatically based on predefined rules. The more data the system is exposed to, the easier it is for it to learn.

Relying solely on TMCs or spending weeks pouring over Excel spreadsheets is no longer necessary if you have the tools to do this automatically. Accurate data delivered at month end is not as far-fetched as you may think.

2. Ask stakeholders what metrics they want

In the Amex and BTN survey, a handful of travel managers listed travel spending as a percentage of company revenue and traveller satisfaction as metrics senior management are interested in.

When asked to identify the three most important metrics to them, senior management, respondents however, rated these two factors least important out of nine. Travel managers might want to ask their stakeholders what they want to see and how frequently they want to see it before churning out reports.

3. Improve engagement

So your data is correct. You are sharing the right information. Only problem is it is still boring to read. Drowning business unit leaders in rows and columns may not be the best approach. Communicating policy compliance, for example, needs to be done in a way in which people can understand. You can’t comply with a policy you don’t comprehend.

Travel managers need to get an automated travel communications strategy in place. Just like companies send you adverts through your inbox in a way that is meant to engage you on something you care little about, travel management policy compliance and spend figures need to be more engaging. Or at least engaging enough so people will read it.

Creating cool visualizations, charts and graphics is a good way to get people excited about the travel programme, what you have achieved and what more is there to come. You can also engage them through story or narrative shown through a text report.

Another approach is to drive competition between departments by benchmarking their behaviour against another company division, for example. This competition can prove interesting and drive improved traveller behaviour.

If you want to find out more about how you can do this, read more on our stakeholder engagement project, The Story.

Travel is a strategic part of any business, and, with the right reporting, the whole company, including finance directors, will see it.

Joni Lindes
By Joni Lindes
6 min read

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