What is corporate travel management?
Corporate travel management, or CTM, encompasses everything to do with the organization, execution, and aftermath of business travel.
It implements corporate travel policy and tackles any problems which arise during and after business travel. The factors it deals with are:
- Hiring services such as flights, accommodation, and transfers
- Health and safety of employees
- Travel and expenses (T&E) and credit card management
- Record keeping
Why is corporate travel management important?
Corporate travel management is crucial for businesses as it organizes travel and expenses, which are often a company’s second-highest expenditure, behind employee salaries. Travel expenses go above and beyond flights and hotels to include meals, client gifts, tips, in-destination transport and much more.
Well-managed corporate travel can increase efficiency, while lowering the cost of business trips.
Types of corporate travel management
Some companies provide in-house travel management, usually organized by the finance or HR departments. One advantage of in-house management is how close employees are to decision makers.
However, most SMEs and large corporations cannot give their finance and HR departments the extra workload of organizing business travel for all employees, and look for alternative arrangements.
Travel management companies
Many companies lack the resources to manage the travel of all their employees. It is common practice for large corporations to delegate their travel expenses to Travel Management Companies (TMCs). These companies are heavily involved with the world of travel and can, therefore, provide better deals than those contracting individual agreements.
Travel companies focus all of their efforts solely on the concept of business travel. This saves many businesses the stress of organizing business travel with many more benefits along the way. It also means that businesses only pay one main business travel invoice, rather than multiple.
Corporate travel tools
Corporate travel tools, such as TravelPerk, add an extra level of flexibility to travel management. For example, employees can book their own transport, accommodation and more, while the tool limits all choices to keep them in accordance with a company’s travel policy.
These tools also keep a record of travel and expenses. This means that the finance department is not only free from the booking process, but it can create or modify travel policy based on solid data.
They usually include a booking tool, an app, reporting and analytics, and excellent customer service. Using Global Distribution Systems, corporate travel tools show flight, accommodation, car hire etc. prices in real time.
Corporate travel tools also have the advantage of simplifying accounts. All aspects of travel are booked through one tool, meaning companies only need to send one invoice for business travel.
How is corporate travel management different from a travel agency?
Both concepts are closely linked, however, a travel agency is an entity that can put a company’s corporate travel policy into action. Corporate travel management sets a company’s rules on what a travel agency can execute. For example, corporate travel management may dictate what class their employees can fly in, or what category of hotel employees can stay at. Therefore, a travel agency is limited by guidelines and must make arrangements in accordance with said guidelines.
Are corporate travel management companies cheaper than in-house travel management?
As corporate travel companies are specialists in the travel industry, they have more experience and expertise, and can get preferential deals. Overall, business know-how usually makes corporate travel cheaper for businesses, which explains their success.