Ask any Finance Director and they’ll probably tell you that business travel and expense management is an ongoing challenge that they struggle to accurately track and forecast. For the majority, assigning spend to any one particular sales or customer revenue opportunity often relies on a mix of painstaking research – pulling data sets from disparate systems – and gut instinct, rather than any sort of science. With corporate travel set to reach $1.7 trillion by 2022, this presents a growing challenge for organisations around the world.
The problem is especially acute in large, global companies where hundreds of employees are travelling for work each week. In itself, this creates huge amounts of admin and leaves little time for business leaders to perform any real analysis of spend versus ROI. Invariably, finance teams have to resort to the not-so-scientific ‘finger in the air’ approach, and when that predictably fails, corporate travel winds up being seen as a blight on their balance sheet.
Corporate travel: business driver vs business drain
The key to cracking the ROI conundrum of business travel lies in having access to more data, and at a very granular level, too. Business leaders should know exactly what they are spending on which sales and customer success opportunities, and crucially, be able to tie that spend to the ROI it brings in.
This is where the advent of technology is providing revolutionary insight. For the first time, technology is enabling business leaders to view corporate travel and expense spend as a mechanism for business growth instead of an uncontrollable cost. By adopting newer technologies that deliver complete visibility of spend against ROI, and which also hook into wider company data such as that found in a Customer Relationship Management (CRM) system, corporate travellers and finance teams can finally stop flying blind and put a science behind their spend.
The end of illogical spend
Of course, it’s one thing to realise that smart technology can reinvent corporate travel as an instrument for business growth, but it’s another to build the business case and get others to change their perceptions of it as a cost center. So what’s the best way forward?
Start by addressing Finance Directors’ long-standing pain points. Explain that tying specific spend to attributable ROI will allow them to work off intelligence rather instinct, leading to better cost control, and the eradication of guesswork. No longer will sales and customer success reps be aimlessly investing their precious time and budgets on customers who deliver little to no return. Conversely, comprehensive spend data will also help business leaders to identify which customers are delivering a strong return and are therefore deserving of more face-to-face attention. In essence, it’s the end of illogical spend and the start of logical investment.
Having a data-driven understanding of projected travel and associated ROI also empowers finance teams to forecast more accurately, further reducing the risks associated with illogical travel spend. Companies can adopt a dynamic budgeting approach to business travel and expenses, whereby different activities are assigned specific travel budgets according to their potential return – and where real-time data gives Finance Directors complete visibility of spend and control over cash flow.
This sort of insight has the ability to transform financial reporting given it’s possible to forecast spend just as well as you can currently forecast sales revenues. Harmful blanket travel bans become unnecessary as a result.The best part is that more data leads to greater intelligence, so the more these systems are used, the better the quality and quantity of insight. It’s direct impact on revenue-generating activities can easily be shared upwards to the board – something that is key to positioning business travel as a mechanism for growth.
Benefits that extend beyond the balance sheet
As technology precipitates this better insight and more informed decision-making, it is not only business, sales and finance leaders who are experiencing an epiphany when it comes to smart travel and expense management, though. Smarter systems that leverage AI and Machine Learning capabilities are also reducing – or in some cases, even eradicating – business travellers’ long-standing frustrations with trip booking and expense claims, creating significant time savings, and ensuring a better experience for the employee.
A good example of this is the application of AI to create tailored travel suggestions for the individual employee. Do they prefer AirBnB over a hotel? Do they prefer a daytime flight or the red eye? Systems need to flex to manage these nuances if they are to engage employees and deliver a strong user experience.
Smart technology is revolutionising the business of corporate travel ROI and providing new opportunities to ensure that revenue will outweigh expenditure. That which has long been the industry’s most elusive goal and the Finance Director’s pipe-dream is now an achievable reality, and its benefits to the bottom line present a compelling case for investing in modern travel and expense management systems.
To find out more about how SalesTrip’s intelligent business travel and expense management solution can help your organisation, visit our ROI calculator.