Case Study: Pre-Trip Approval
A multi-national manufacturing firm has been a Corporate Travel Management (CTM) client for over 11 years with offices across North America, EMEA, and APAC and over 5,000 profiled travelers. As part of our continuous improvement planning strategy for our client, CTM conducted a study to assess if hard stop pre-trip approvals on airfare reduced cost and guided compliant employee behavior.
Travelers were frustrated with hard stop approval processes as many times their submitted trips were delayed in receiving approval from managers. As a result, travelers had to repeat the process only to find airfares had increased. The challenges were identified on more than 10,000 trips issued out of North America:
- Traveler frustration in waiting for manager approvals; often the manager missed the airline imposed ticketing deadline
- Traveler loss of time to have to rebook the trip when a manager failed to review for approval
- Increase in airfares when travelers had to rebook same flights
- Impact on travelers’ schedules when selected flights are no longer available
CTM conducted a study to assess if hard stop approvals were inflating travel costs and negatively impacting employee productivity and program satisfaction.
Since our client’s senior leadership did not want to abandon hard stop pre-trip approvals, CTM recommended we engage in a study to assess if hard stop approvals were inflating their travel costs, the overall impact employee productivity, and poor view of the travel program. We used the following parameters to engage in study for a period of 6 months by assessing the following:
- Number of trips approved by managers
- Number of trips declined by managers
- For the trips that were not reviewed in a timely manner and had to be repriced and submitted again, we created coding to compare the first fare submission to the repriced trip to assess cost differential
- Traveler time to reprice trips
Based on our study we found on average our client was losing $5,000 per month by requiring approvals on every trip. In this same period, there was not one trip that had been denied. In surveying managers who had the highest level of missed approvals, they cited their inability to provide approvals due to their travel and meeting schedules. This does not take into account the employees’ frustration and loss of both traveler and manager productivity.
From our results, we recommended the following to our client:
- Increase cost savings in one of two ways:
- Move from a hard stop approval process to a manager notification process; this ensures managers will not delay ticketing and travelers will not be subjected to repricing trips and lost productivity
- Take a hybrid approach where only airfares $1,500 or higher need approval; all other airfares would be managed through a notification process
- Market the policy to change to employees to promote both compliance and a traveler-centric approach
Our client opted to move to the manager notification process and is on pace to save $60,000 annually.