Business-Travel Reduction: Busting some myths

Several mid-sized tech companies have had us create business-travel-reduction programs, for significant Lean (money savings in the millions annually) and Green (carbon reduction in the hundreds or thousands metric tons annually) benefits. In every case, we’ve reduced travel — sometimes more than projected. Yet in the process of customizing travel-reduction programs we run across five myths that we must bust to give clients’ profitability and environmental benefit a full shake.

Myth #1: Employees will resent travel reduction. If because of business travel you have ever (1) missed your kid’s graduation or performance, (2) not registered for an evening course that requires steady attendance, or (3) felt reluctant to book vacation in a fabulous distant place because flying has worn you down, then you know to question this myth. We begin customizing a client’s travel-reduction program by interviewing frequent travelers; these interviews quickly reveal that most travelers would like to curb non-essential travel.

Myth #2: The Sales Department must be insulated from travel-reduction programs, to prevent sales erosion. We used to go along with this view: after all, no consultant wants a client to experience lower sales based on a cost-savings recommendation. But then the evidence starting flowing in, such as from Oracle’s Green Sales program, which has the sales force reduce travel via web-based demos and reduce the number of demos needed based on consultative insights. For example, instead of sending about 5 sales-related people to a customer’s site, they’ll send 1-2 and have the others participate by the web. And what was the affect on company performance? –Profits up and sales decline (owing to the economy) lower than anticipated. For effective travel reduction in the Sales function, conduct objective interviews with Sales as well as customers to uncover non-essential travel, and provide easy-to-use travel-avoidance tools.

Myth #3: Travel reduction is only about reducing airfare. Corporate expenditures on airline tickets can be only 40% to 60% of total business-travel expenses, which include steep costs for rental cars, ground transportation, parking, lodging, and meals. When you capture all travel-related costs and carbon emissions, the significant savings may surprise you.

Myth #4: Travel is a long-term strategy for integrating combined business units. Travel can help bring acquired-companies’ employees into the parent-company culture, but frequent travel is not necessary for the long term. Our research has shown that “internal meetings” is the business-travel category that travelers report they can reduce most readily — even at companies that have grown recently through acquisition. Company culture is driven in large part by the CEO, who — along with other top executives — can regularly address employees using video recordings, video-conferencing, web-conferencing, conference calls, employee newsletters, monthly “What’s on my mind” emails, and other inspiring travel alternatives. This sends a strong message that employees can likewise work productively with off-site employees without traveling each time.

Myth #5: We’ve already reduced business travel as much as we can. Owing to the economic climate many companies have recently reduced business travel. By analyzing why employees travel — through interviewing frequent travelers and requiring all travelers to specify how the trip contributes to corporate objectives — we discover process changes that render classes of business travel unnecessary.

It is undeniable that sometimes face-to-face meetings are best. Having lived and worked a year in EMEA and now back in the San Francisco Bay Area, I can attest to the value and enjoyment of having met with TFI’s EMEA clients in-person during the past year, and now reuniting with my Silicon Valley clients and colleagues. But by using a green lens to re-look at conventional business processes, we find new ideas for savings. And instead of finger-wagging employees (”Don’t spend so much money!”), we inspire them to improve the quality of our lives and the environment.

What travel purposes are sacrosanct at your organization, and should they be? (Please leave a reply below.)

Posted by Pamela J. Gordon, August 14th, 2009