Ultimate Guide to Understanding the Benefits of a Travel Management Company
Managing and operating modern businesses often encompasses corporate travel. However, managing business travel is complex, especially with limited experience and resources. You must ensure that everything goes smoothly for the travelers while staying on top of the logistics and expenses.
That’s why many organizations decide to outsource their travel management to a dependable travel management company. Your company is a part of the vast business travel market. In 2020, it was valued at $656 billion, and it’s projected to reach $2,000 billion by 2028.
In this article, you will learn what a travel management company is, what benefits it offers, and discover real-life examples of using these companies to understand their value to your business and the travel industry as a whole.
Definition of a travel management company
Before we tackle travel management software and management platform solutions, big data in the tourism industry, and expense management, we have some ground to cover. You need to understand what a travel management company does, and the best way to do it is to learn what travel management exactly is.
Travel management encompasses numerous processes in a company that strategically manages a business or corporate travel. There are no two same travel management strategies out there as every company is unique, including its travel requirements. While a travel management strategy can encompass the management of a wide range of travel-related processes, the most common ones include the following:
- Standardizing corporate travel with a company-wide travel policy;
- Outreaching vendors and establishing partnerships with them;
- Making bookings;
- Monitoring travel costs;
- Expenses management.
Some companies do this internally, while others seek a partner to streamline all these processes for them. These partners are called travel management companies. A travel management company specializes in managing travel for its clients. Clients can include individuals, but they are most often businesses and other organizations.
Finally, a travel management company is different from a travel agent. Unlike travel agencies that specialize in sourcing, distributing, and selling travel packages, travel management companies are in charge of strategic management of their clients’ travel requirements.
Benefits of using a travel management company
If you are assessing whether your company is fit to manage travel on its own or it needs help, or you just want to learn more about travel management companies, you should discover the benefits these companies can offer.
After all, 91% of business travelers think that business travel is key to company growth. Using travel management services can help you reap even more benefits. Below you can find all types of benefits, from the obvious to the more obscure ones.
One of your primary concerns is probably related to costs. In other words, will working with a travel management company help you see some return on the investment? There are two charging models by which these companies operate. You will either pay for their services on a subscription basis or pay fees per service used. How will you save money then?
You won’t have to work with vendors directly anymore. Instead, you will get access to the network of vendors your travel management company uses. And, quite often, thanks to their years of experience in the travel industry, they will have better transportation and accommodation rates than you.
You will see significant reductions in overall travel costs, which will be more than enough to compensate you for paying for travel management services.
Internal travel management has only one benefit – you have complete control of your travel management. On the other hand, you have to take care of all the data, booking, compliance, paying invoices, tracking, and managing medical coverage. However, when you outsource it to a reputable and trustworthy partner, you can rest assured that they will deliver on their promises.
In return, you unlock the next-level convenience. What does it imply? You will get peace of mind. Your travel management company will handle everything ranging from booking to airport transfer, ensuring that nothing remains overlooked.
Access to a wide range of travel options
Travel options include transportation, accommodation, and medical coverage. Given that your experience in the travel sector is limited, the chances are that you will only research a few options before finally making your decision. When it comes to the number of options you can choose from, your situation will dramatically improve if you work with a travel management brand.
These companies have hundreds of vendors in their networks. Thanks to your new partnership, you can gain access to a wide range of travel options. You won’t be as limited as you used to be, and you will step up your corporate travel game.
Improved efficiency and productivity
Your efficiency and productivity depend on your available resources and how efficiently you utilize them. Internal travel management has a significant upkeep.
It simply means that every corporate travel-related task takes time. Your staff spends hours every time there is an event that includes corporate travel. They need to research available bookings, make a plan, and then execute and monitor it.
When you work with a travel management business, you don’t have to do anything related to corporate travel except engage in it. You will free your staff. They will now have time to spend on more pressing matters and core business processes, thus bringing your business closer to success.
Risk management and emergency support
Managing corporate travel is a delicate task as there are many things to consider. Overlook one of them, and you expose your entire effort to a risk of failure or delay. Plus, if something like delay or failure happens, there is no safety net you can rely on. All of this changes when you work with a travel management company.
Since these companies specialize in travel management for other businesses, they have significantly more experience than your staff. They know which tasks they need to complete and double-check, thus mitigating your travel-related risks. And, if there is an event of an emergency, they have policies in place to help you overcome unforeseen circumstances.
Customized travel solutions
We’ve already stated that no two travel management strategies are alike. That’s because every business is unique, and every travel plan is different. Working with your new travel management partner will help you unlock new flexibility and customization options.
All services you’ll receive will reflect your unique business travel needs, and nothing will be set in stone. You can still request specific changes if you deem the current offer incomplete.
It applies to each one of your future corporate travel events. You are still in control, but now you can choose what is best for your company and staff.
Relationship-building and networking opportunities
Building relationships with other brands and participating in networking events is important for every business, regardless of size or vertical. Using travel management services can help you step up your networking game, as it will unlock the new door and create many opportunities for you.
You can meet other clients of your travel management company, exchange important business insights, and maybe even establish new partnerships to conquer new markets. Building long-lasting and meaningful relationships with other companies can help you position your business better and make it more competitive.
Real-world case studies
Do you want to see a travel management company in action? Why wouldn’t you? Discovering real-world case studies can help you see what such a company can offer to your business. Below you can find six companies from different verticals and learn how travel management companies helped them achieve their goals.
Hotjar saves 70% by ditching back-and-forth emails
Hotjar is one of the leading platforms for collecting customer feedback and analyzing their behavior. The company has offices worldwide, making planning and organizing Hotjar biannual company-wide meetings quite challenging.
It takes managers days or even weeks at a time to plan and book all the travel. Another reason this task is so challenging is that team members use back-and-forth emails to book and manage travel.
The company decided to start using the services of a travel management company. They got access to a travel management platform and one pager dashboard to help them monitor travel. Hotjar staff members spent 70% less time booking travel and have all travel in one place.
Infineon finds a perfect solution for travel compliance challenges
Infineon is a world-famous semiconductor manufacturer. Back in 2016, the brand started company-wide digitization. However, when they began digitizing their travel management process, the staff experienced a challenge. The international travel and different travel requirements made the travel compliance rules very complex.
Instead of having their employees handle travel compliance on their own, the company decided to use travel management services. The travel management company managed to automate this process by integrating a risk assessment check into the workflow.
Overcoming travel compliance challenges became easy as every travel requestor and approver now had access to risk assessment to properly mitigate it before travel.
LivaNova gets ahead by prioritizing traveler well-being
As a global healthcare company, LivaNova often requests its employees to travel. However, the company has over 3,000 employees and a presence in over 100 countries.
It makes organizing and managing travel internally time-consuming, especially when every traveler has a unique role and comes from a different location. Plus, there was an issue of having a uniform policy that benefits all LivaNova employees despite their location.
The company decided to align with a travel management service provider. They managed to come up with a company-wide travel policy that puts employees’ well-being in the first place. As a result, the online booking rate through travel management companies went up to 85%.
They also gained access to a single DMP and data warehouse, equipping all their team with real-time data for smarter decision-making.
Danske Bank reduces travel expenses by up to 14% per traveler
Danske Bank is one of the largest financial organizations in Europe, and as such, it does business across the countries. The company’s travel program was far from consolidated. They had minimal to no travel program oversight, several travel policies, and minimal travel policy adherence. The bank decided to work with a travel management company.
They completed the following three projects: consolidate the travel program under one travel policy, implement online booking tools, and drive compliance. Thanks to the new approach, the bank had better control and oversight over how 7,000 travelers use company resources to book travel. In the end, the bank reduced travel expenses on airfare by 6% and hotel room rates by 8%.
Freenome cuts booking times by 50%
Freenome is a leader in the AI genomics market. It specializes in early detection and precision intervention. However, as the startup started growing, the managers found that the old platform they used to search and book flights and hotels was no longer efficient. They decided to partner with a travel management company.
Thanks to the new partnership, they were able to implement a new booking interface across all their offices. The final results were outstanding. Freenome managed to reduce the time needed for booking trips by 50%. Plus, their accounting team now has all travel expense data in one place.
eCommerce business saves $105,000 in travel expenses
A well-known eCommerce company launched its travel program through two internal travel teams located in their two main office buildings. They had two problems with this setup. First, call waiting times became lengthy because face-to-face interactions took more time. And secondly, they were not able to track the Service Level Agreements of the travel consultants.
The brand partnered with a travel management company. The new partner immediately consolidated internal teams to one team managed exclusively by the travel management company. The results were as follows: more efficient tracking of traveler cases and travel expenses reduced by $105,000 during the first two years.
A travel management company offers many benefits to companies across verticals despite the scope of their travel needs. With the help of such a company, you can reduce travel expenses, streamline compliance, access a wide range of travel options, reduce risks, and improve efficiency and productivity. While the above-listed case studies paint the picture of the value of collaboration with a travel management company, you should understand that communication is key. Once you decide to use travel management services, you should get in touch with several companies and base your decision on cost and how well your future partner understands your company’s travel needs.
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