A very warm welcome to our very special guest, Kate Hart. With nearly a decade of experience in the travel and expense space, Kate currently serves as a customer success manager at TravelBank. Kate loves connecting with clients to understand their unique business needs and help them get the most out of TravelBank’s travel expense and card management features. She regularly hosts office hours to coach finance and accounting executives on topics including expense policy automation, expense program rollout, FinTech, user adoption, corporate travel rates and more. Kate’s career in T&E actually started on the business travel sales team of Hilton Worldwide where she grew passion not only for business travel but also helping our clients make the most of their travel budgets with benefits such as negotiated hotel rates. Welcome Kate. The floor is yours.

Kate:

Thank you Stephanie and welcome everybody. I’m really looking forward to talking to you all today about travel and expense policies. We will be focusing on specifically travel and expense policy failures and how they are costing your organization money and some tips that we recommend for how you can fix those failures fast. There’s a few trends I’m going to go back to today. So, one with policy compliance, we can typically see about 20% cost savings, which is why this is such a hot topic for us to discuss with you all today with our clients here at TravelBank. The difficult part of that though is policy violations are rampant. So how do we fix that? We recommend that organizations make their travel and expense policies both accessible and digestible and have you all create policies for emerging spend patterns. A lot of spend patterns have changed, especially from the pandemic and now coming out of the pandemic and what all that looks like, especially in the travel space. So how can you keep an eye out for those emerging trends and patterns and how to shift them? And then we also want to talk about how to automatically enforce your travel and expense policy at scale just to make sure people are following what you have in your policy.

Forrester Consulting study said that the greatest financial benefit is improving policy compliance. So, whether you’re using a platform like TravelBank for Travel and expense or a similar platform, you can start to see anywhere from 40 to 91% adherence in there in your policy. So that can save about $321,000 over three years and that’s a very big number. So we want to make sure that you all are getting this maximum savings. We see it in four different buckets as you see on the screen here. So the first is going to be cost savings from retiring legacy expense and travel solutions. With that we mean coming to platforms like TravelBank and others like ours that make it easy for you to build your travel policy rate in a software instead of having paper trails with it. So really using software to your advantage. The second is going to be cost savings through increased policy adherence and that comes back to using a software and making your policy accessible and digestible. We also see reduced travel spend when you are using different platforms since you can build your policy in there once again, and one of the best savings that I know you all as finance leaders will really care about and your teams time savings for managers, finance and end users. At the end of the day, time is money, so how can we save you all time?

A poll’s going to pop up, but I’m very curious, how often are your travel and expense policies being violated? Is it happening frequently? Is it sometimes that you feel pretty okay about it? Is it rarely happening? Do you feel like it’s never happening? People just know your policy, they are never going against it or you just might not know. So we’re getting a lot of answers in here sometimes seems like the most popular answer and we are seeing frequently and rarely too. The 1% that says never. I would love to see how you’re doing that because that’s awesome that if people are really adhering to it and there are no violations and those that just aren’t sure too, that’s something we will really talk about how you can get that information.

So, thank you all for answering that. It’s definitely sometimes we’re sitting there at 61%, so a lot of you are seeing this sometimes. So how can we use that data to get more information? For most organizations, violations are rampant, which we just saw in that previous poll. Some people are seeing it frequently and some of you all are just seeing it sometimes. So whether you’re at your desk at the office, you’re working from home, let’s think about these five bullet points here. The first one, 61% of finance executives report that their travel and expense policies are frequently and sometimes violated.

That’s funny because the poll we just did, 61% of you did say sometimes. So this is completely spot on with the data that we’ve seen in the past. A large amount, 73% also agree that employee violations of travel or expense policies become a bigger issue over the next five years. And why is that? That can be from organizations growing, from trends changing, from the industry, adjusting. So there’s a lot of different things that come into play with that. So we want to help you get your travel and expense policy violations down right now, so as you grow in the next five years, they stay down. They are not at that 61% that we’re seeing. A lot of organizations frequently set travel and expense policies, but there’s no way to encourage or enforce those. So wherever you are today, put a hand in the air if you feel like you have no way to enforce these and then that’s something that we will talk about too.

Finance teams tend to be the leanest at the company. If that’s how your team is, let’s put another hand in the air. So with the finance teams being very lean, it can be hard to get that information. I see those hands being raised, which I love. So how can you all work with your lean team by still getting that information out there? We also see that there are reports that expense reimbursement, fraud, it is a thing unfortunately. So the cost that can have an impact on your company is a median of $40,000 and it can take up to two years to catch, which is a really long time. So as you start to think about audits that you might be going through financial planning for the next year, what your policies look like, we want to keep this number in the back of our minds too just to see how we can reduce those.

And then our fifth one for the policy violations being rampant, we talked about this a little bit, but as organizations scale, whether that’s in complexity, so maybe you do some reorgs where teams are shifting, priorities are shifting, goals are shifting, or if it’s headcount, whether that’s going up or it’s going down, it gets harder for finance teams to review every transaction against the policy. So whether that means you go from 10 employees to 200 employees, there’s a chance that maybe your finance team hasn’t grown that much and now they are responsible to get all of those transactions. So when employees start to overspend, the feedback loop takes a little bit too long and we want to see how we can shorten that.

So curious, does your team today have a way to encourage or enforce policy? So whether it’s automated, it’s manual, or if you just don’t have a way to do it today, it seems like for a lot of you all it is a manual process, which that takes a lot of time from your day-to-day. So if we start to think about looking at expense policies and when they’re getting sent to you for approval, for reimbursement for month end close, if that’s a manual process, your team is taking quite a lot of time to do it. We’re seeing about 20% of you have it automated. So, if you are using a platform like TravelBank or something very similar, that’s typically how you can get automation very quickly and then some of you all do not have a way to see it today. Going back to that first slide that we talked about too, we can see 20% cost savings just by having your people adhere to your policy. We really want to start thinking about how can we use it.

So why do travel and expense violations happen? It’s usually not intentional. I mean if you have somebody sitting right next to you, ask them quickly, have they ever had a violation? What did that look like? Was it intentional? It probably wasn’t. Everyone on this call may have even had an unintentional one, and the reason could be that the policy is just not accessible to you where you don’t know necessarily can you expense $50 a day for lunch or is it $30 a day for lunch? And maybe that’s just not ingrained in your head with all the other work that you’re doing. So by not having that policy accessible, it’s very easy to violate it without even realizing there aren’t always policies for emerging behaviors. We really look at the emerging behaviors such as Uber Eats or any of those DoorDash, anything of the sort where those are starting to take over a lot of the spend and expenses that are going through and coming to you all for in the expense reports for you to approve where not every company has a policy in place for that.

Same thing with working remotely, especially now that we have organizations that are doing more hybrid where they have people going back two days or three days and then also working at home. So thinking about what does that look like now? Are you starting to pay for parking again? Are you starting to pay for any travel costs for people to get into the office? So thinking about how those behaviors are shifting but also emerging new behaviors and then going back to that feedback loop. So when employees overspend the feedback loop, it can take months or it could even take longer than that and by the time you get to a quarter out, two quarters out, you’ve already closed those books and now you’re seeing that a violation happened. So how can you have that violation be caught quickly or have that violation not even happen? So just keep it in mind that your employees are not always doing this intentionally. So we need to find ways to help them know what is right and what’s wrong within your policy.

All right, the big question, how long does it take your team to catch out of policy expenses? We have instantly. So the second that policy, that expense comes in as soon as the expense is submitted. So when we think about this option here, the expense could be submitted within the month, it could be submitted the next month, the month after that. So people are not submitting expenses right at the time of it happening or within the month. It could be a few months later than the expense happened within a month. So if your team is very, very good at their expenses in monthly, you’re getting your approvals in monthly, all of that, you can usually capture a rate within that month, two to three months. So we’re starting to think maybe a quarter out or four months longer where we are going past a quarter out.

So, we’re definitely seeing a lot of you are getting the, if somebody’s out of policy, it’s as soon as the expense is submitted or within a month. So about 50% of you answered either one of those ones. So that’s actually very, very good and that’s what we’d love to see too, where it is of course on your team to submit their expenses in a timely manner. And then usually since you are closing the bucks once a month, within a month or as soon as the expense submitted is a really, really good time to be catching that. So those of you that answered B or C, there’s a good chance that you have an automated system in place there, or if it is the manual system like some of you do all have, then that manual way that you’re capturing it so quickly. It could be because you have a large finance team or you have maybe 10 people submitting expenses where you can get a lot of eyes on it manually. But those that do have it automated, we typically see you answering B or C. But how do we get it to a, if you can find out exactly that an out of policy expense happened when the expense incurred, that can really, really change how much you save.

So how do we do all this? I’ve asked a few questions, I’ve given some statistics out there, but what actions can we change to make this all possible? One is make your travel and expense policy accessible. Outdated policies happen. We definitely understand. We do recommend if you can take a look at your policy, usually twice a year, once a year minimum, just to be able to review any emerging trends or even if you have a section in there for mileage reimbursement and you use the IRS rate, you’ll want to update that once a year as the IRS rate changes to have that correct amount in there. So it’s little things like that that you want to think about. And then if you’re going in once a year to update the IRS rate in your policy, take a look at everything while you’re in there, is what we would recommend.

The PDFs though can be really hard to track down and read on company intranet. So that’s going to your likelihood of violations jump up a little bit. So there’s static policies and there’s manual checkpoints and those are going to open up a lot of slack between the employer, the manager and the employee. And once you start getting through all of those people is when people are not retaining what the policy looks like, they’re not sure where to get it and then they just start spending. So chances are, I’m sure some of us on the call today, if you’re traveling for business, picture this scenario, you’re traveling for business, your flight gets canceled, there’s a really big snowstorm in the northeast when you’re traveling, what do you do? Are you just doing whatever you can to you just get home, get a flight, new flight booked, you want to get home to your family?

But there are policies around that. So we want to make sure in those scenarios, especially more of those high stress scenarios, it’s really easy for your team to find the policy. So in those instances that you get stranded somewhere, you want your team to know what should they do if a flight is canceled, should they book a new one? Should they wait for the rebooking from the airline? Should they just wait for the delayed flight? What should they do with refunds? Should they get an airline credit if it was booked on the company card and they’re offering to just refund the card, should they do it that way? Should they get a credit to use for a future flight? What are your expectations there? If the airline’s offering them a hotel for them to stay in, if they’re stranded, should they be accepting that or do you have a policy where you want them to stay?

If there’s a hotel at the airport but the airline has them staying a couple miles away, would you prefer them just to be staying right at the airport for convenience, for safety, whatever that might look like within your policy. So starting to think about that and then how much can they spend? So if the airline doesn’t offer them a hotel, you probably don’t want your people sleeping in the airport. So how much could they spend on that last minute hotel for when they’re stranded? If they are delayed seven hours, I was recently delayed five hours and it was one of those, could I use the airport lounge? Is that a cost that I could submit to my company knowing that the airport lounge would give me a lot of space to do my work? You typically have the food included in it. So is that going to save money than buying two meals at the airport?

Is that going to give me the better WIFI so I can get work done while I’m waiting for the 5, 6, 7 hours? Thinking about what those policies mean, one, what that looks like in your policy. Two, how is your team going to get that policy, especially in these high stress situations because we also of course want to save you and your manager’s time where they don’t keep getting calls saying, Hey Kate, I’m stranded. What the heck do I do? You just want them to be able to find that on their own. So make your team policies accessible.

A few tips here, how to make them centrally available. We recommend linking them in multiple different places. So whether you are using Slack or teams, you can just pin it. So if you have a general channel or a travel channel, an HR channel, however those channels are set up at your organization, you can put that policy rate in there and just pin it to the top of that channel. And anytime somebody needs it, they know they can go right there. You can cross-link it in the employee handbooks and different trainings. So if you do have quarterly trainings that people have to take and maybe summers around policy, you can typically add that into the training where they can download the PDF of it and have it stored. It’s also really helpful you all being on the finance team, add it to your internal email signature.

So anytime you email somebody internally, it’s just right in the signature. So if they’re out on the road, they can search your name, pull it up in the email, and they’re going to have the policy right there. So that’s one of my favorite ways to do it and you can have other people pin it to their internal signatures too. So whether that’s your HR team, even managers, because typically whatever email system you’re using, you can have a signature for internal or for external. Same thing with out of offices too. So really helpful to put that in there. And then you can add it to any transactional emails within the TE workflow. So however you’re doing your travel and expense workflow, if there are automated emails that you have the option to adjust, I recommend just putting that link to your policies right in there too.

So, if we think about all four of these options and we do all four of them, your employees are going to know where to find your policy at any single point in time. If you were just to do one of these, I would say just pin it into Slack and teams channels. If you were to do two of them, I would say add it to the finance email signature or any other internal signatures, and then if you can do all four, that would be the preferred, but that’s kind of my tips of how I would think about this.

So, with the tips that I just gave, I’m curious how your TNE policy is available. So do you have it saved as a file just in one place? So whether that’s an intranet, it’s Google Drive, a SharePoint, do you have the file linked all over the place? I’m seeing some people having that, which is awesome. I would love to hear about how that’s for you. And do you have a policy built into your travel and expense management platform? And it’s very possible you could have B and C as options too. So if you do have a travel and expense management platform, that’s always a really good place just to have it built out. But then it’s also helpful. So if people are not booking a trip right away, they can still go into a file to find it too. So we’re seeing 77% of you all have it saved as a file just in one place. So I definitely some homework once this call is over, I would recommend saving it in more than one place because having it accessible is going to make things very easy for your team. So just going back to what we had previously talked about after this call, add it to teams, add it to Slack, add it to your email signatures, and that will be a really, really great starting place for you.

So, we can make travel and expense policies digestible too. So the too hot, too cold, just right. Thinking of the Goldilocks version there. So strict policies, while in theory they sound like they would help you out a lot and save a lot of money, the strict policies, especially if you’re rolling them out for the first time, will make your travelers feel unsupported. You will get a lot of pushback. I’ve seen this with clients before. They come to TravelBank and they say, Hey Kate, we have a travel policy. This is the first time we’re rolling it out. We want to build it into TravelBank so that way we can roll out TravelBank and our new policy. My biggest suggestion in those situations though is hold off on doing both very strongly, which may seem opposite of what some people expect, but if you push out a travel and expense software with a very strict policy and it’s the first time people are seeing that policy, you will get a lot of pushback, a lot of violations, and it can be hard to come back from sometimes.

So, decision makers might see a decrease in cost if you have it too strict of a policy. So when we think about a strict policy, that’s going to be ones where people have to book the lowest hotel cost. They have to book the lowest flight cost. The lowest flight costs might have them leaving at 5:00 AM with one to two layovers versus if they spent $50 over the lowest, they could get a little bit more sleep, have one layover, just give them a few more options so they’re getting to their location well rested and quickly. So just thinking about by giving that flexibility is going to make your team feel seen, it’s going to make them feel heard and they’re going to have the trust in you that you are giving them some flexibility. So in return they’re going to be booking within policy. The whole other side of that spectrum, the two cold. If loose travel policies are happening, your travelers are going to have minimal guidelines, maybe no guidelines, and they could go crazy with it.

People are traveling for leisure, it’s their money they’re spending. They are going to be thinking about booking maybe the basic economy, booking an economy flight. They’re going to not pay to be able to select the seat at the front of the plane. They’ll just say, oh, I got the middle seat. I’ll spend that extra money when I get to my destination. If they’re traveling for business, they might say, oh no, I’m selecting a seat at the front of the plane. I’m going to pay the extra. I’m going to get the premium economy. I’m going to treat myself. If people have that much flexibility, they really can take control of the spend of the situation. So decision makers in these situations can see costs skyrocket offhand. Policies aren’t always reasonable and they’re not scalable. If you are a smaller organization, and I’ve seen this with some clients I’ve worked with where they have about 10 people and their first policy is in this bucket where it’s very free range and they think we know these team members very, very well.

There’s 10 of us. We work so closely together, they’re booking everything. It’s their own money. And that could be very, very true when you have a small team, but why this is not scalable is say you add 10 more people, 20 more people, 30 more people, you cannot keep track of what they’re spending. And the reality is, is you lose that tight-knit community once you start to grow a lot where you have different tight-knit communities within the company. So it’s hard to be scalable where once that’s part of the culture of people just booking whatever they want, it’s hard to come back from that. So it’s always good just to get it just right. Just right is different for every single company. So why we really strive for this is one, you’re saving money. People are not in the too cold option. They are not booking whatever they want, but then your travelers feel supported so they don’t feel like they have to book these awful times.

Flights, the basic economy. They don’t feel like they’re being really restricted that way. So the decision makers, you all are going to create a positive culture and then you can start focusing on other areas of the business to be able to adjust cost. So this comes down to it’s making your employees happy and it’s making your bottom line very happy. So I definitely want to avoid the too strict and the too loose. Biggest thing here too is you want to make it human friendly. So an 80 page policy is not super human friendly. If you can make it just bullet points, make it super quick for people to understand, then that’s going to help you a lot. So if it can be a quick TLDR one page, this is what we expect you to spend, this is what we expect you to think about, then that’s going to help people just read it once it’s in their mind and then they’re going to understand how to spend money moving forward. Put yourself in the employee’s shoes. You all are probably going to be submitting expense reports and traveling. So put yourself in the shoes of, okay, if this were me, would I remember this 20 page document? Would I know where to get this 20 page document? And if that’s not coming naturally to you, then we need to think about a different way to do it just to make it more employee friendly, more human friendly so people know exactly what the outcome is expected.

I’ve mentioned a couple of times today the emerging spending patterns. So last year we spoke to you all and we pulled the CFO Leadership Council and most attendees that we spoke to did not have a clear policy for general retailers. So like Amazon, we’ve looked into this data even more as trends are merging, but what companies have seen, even just one year into the pandemic expense violation rates increased by 292%. Those trends, while that was one year after the pandemic have continued more or less where since a lot of companies have not created policies over emerging spending patterns, we’re still seeing that a lot higher than it should be. So corporations tend to look at hotel rates, they’re looking at the meals, but they haven’t looked at the general merchandise retailers. So that’s something that I really homework number two, something to think about when we get off this call if you have some reporting that can tell you what your most expense merchants were, either we just finished H one of the year, what that looks like for H one or what that looks like for 2024 for you.

And if you can compare it to the prior year and see what merchants are starting to make their way up to the top of your list. So in 20 22, 20 23, you may have had Amazon a little bit lower on your list, but it might be creeping up and let’s be honest, I am guilty of it. I see Amazon packages come to my house pretty frequently. It is so easy to go in there and just buy something and it’s very possible that that’s what some of your employees are doing too. They might have a cord that breaks and if they have access to the Amazon business account, just go in and order a new one or something super quick like that. So take a look at what those top retailers are and I would recommend starting to put a policy in place for those. So, whether that is if you have, for example, in TravelBank, people can create a category of general merchandisers.

So, if people were to select that, they can build in a policy saying you can spend a hundred dollars a month against this category. If that’s something that your platform that you’re in today or whether you’re doing it manually can do, I would start to think about that. So capping people on either an annual basis, quarterly basis, or monthly basis of how much they can spend at Amazon, that’s going to make them spend a little bit more wisely. So maybe you give everybody $200 a year to be able to buy things for their home office on Amazon. Start putting those policies into place and see how that shifts your most expense merchants into 20 25, 20 26.

Amazon of course is a big one, but the same is true for meal delivery fees. So once again, if you can access this data just looking at the merchants that’s for the meals. So what you saw popular in 20 22, 20 23, even 2024 compared to year to date, it very well may have shifted. So whether that’s moving DoorDash, moving Uber eats up to the top of the list versus people going to the restaurant themselves, it’s something we really, really want to consider when you’re building out these TE policies. As you can see on the screen, the same exact sandwich from GrubHub, DoorDash, Postmates, Uber Eats and going to the restaurant directly. The costs are extremely different. The cheapest one of course is going to the restaurant directly. The reason being is restaurants will typically mark up the cost of whatever the meal is if it is being ordered through one of the delivery services because the delivery services charge them money to be able to use their platform.

Of course, there’s benefits for them to be using those delivery services just to get more business, but they have to keep their cost in mind. You all also have to keep your cost in mind. So this is why we really recommend getting a policy around meal delivery fees specifically. It’s very convenient just to go into Uber Eats order the sandwich, but maybe the restaurant is just a couple blocks away. So if you have a policy in place where people, if they’re within a certain area, they just need to go to the restaurant themselves or depending on how you have expense reports collected, so maybe that’s through a platform or maybe that’s manually having people pull out the meal delivery fees from the meal itself. So you could split those expenses. For example, how we do it in TravelBank is people can split their expenses by different departments as well as different categories.

So, what I see companies do is they will have people split anything that’s in the meal category where it has to be just the food cost and then it has to be any taxes and fees. That way the companies are now able to see how much are we spending in taxes and fees compared to the previous year, compared to the year before that as well. So we’ll give you a lot of information into, hey, are people just spending way too much in these delivery fees? How can we cut this back? But if you don’t have that data, it’s really hard to know where to cut it back. So another piece of homework go in there and if you don’t have that built out today, I would recommend adding something in place where you can split out the delivery fees from the food cost and then start looking at that on a quarterly and a yearly basis to see how it compares. Chances are you’re overspending a little bit on those delivery fees and we can see a lot of savings there.

If you do start that homework though, with looking at your merchants, restaurants people are spending at, that will be a good place to start because if you don’t have Uber Eats and DoorDash up at the top of your list anyways, you can put your efforts elsewhere. If you see those as merchants that are constantly being expensed, jump right into that please. Another emerging category is having people know when to drive and park versus when to get an Uber or a rental car. So when we did a poll last year, we asked, do you all help employees decide between driving, flying, taking a train or taking a left? 71% of the CFO Leadership council said no. So, this is another way that you can really start to save money because personal vehicles we saw being used 63% of the time across all TravelBank users in 2024.

With this of course comes the mileage expenses. So this is really helpful to compare from previous years to see, have your mileage reimbursements come up, have your Uber Lyft costs come down? Where are your rental car costs? So if you have people that are doing a lot of personal vehicles, would it make sense for them to do a rental car instead of doing mileage? Because of course when people are submitting for mileage, it’s not only covering the gas, it’s also covering the wear and tear on the car. So would a rental car be more cost effective to not have to pay that mileage fee? What I see a lot of companies do within their policies when it comes to driving and parking is saying if it’s over a certain amount of miles to do a rental car, depending on what your mileage policy says and how much you reimburse for mileage, this is going to help you figure out where that number is that a rental car is going to be more cost effective versus paying the mileage.

So, I would recommend going in and seeing when people submit mileage, those mileage costs that are the highest ones on your list. How many miles did they drive? Was it over the course of one day was over the course of two days, and how much would a rental car be over the course of that amount of days? And then compare the cost that way. And then thinking about Uber and Lyft. So typically if you have people that are traveling to cities more frequently than rural areas, Uber and Lyft and taxi is probably going to be more cost effective. But also taking that into consideration of what do you want in your policy? Do you want to say anytime they are traveling to a city where parking is super expensive, they have to do Uber and Lyft, that’s probably a good thing to put into your policy.

But if they are going somewhere where they need to be driving to this client and then this client and they’re driving all over, you might want to start thinking about, alright, a rental car might be the way to go. So you’ll want to look at one, your trends of where your people are traveling to see if Uber and Lyft is readily available. If it’s not, start looking at those mileage costs of when it makes sense to do a rental car versus paying for the mileage at the rate that you reimburse. So just to reiterate your next piece of homework, go in, see what your mileage reimbursement costs are, the ones that are the highest, look at how many miles they drove and look at over how many days and think about and then price out what a rental car would’ve been over those couple days and then you can decide whether they should have gone the rental car route and then put that into a policy when we continue this conversation around clarifying, emerging spending patterns.

So beyond setting and publishing a policy, start thinking about a travel and expense software. So how can this help? Once again, whether you’re using a TravelBank or something similar, the software can help you build out the policy. So typically as admins, if you all were the admin in the software, you would have company settings that you can set up based on this is how much people can spend on a flight. These are our policies around how much to reimburse for mileage. These are our policies around how much people can spend against the client entertainment category for example. And then you can work in approval flows too. So by using the software, those that answered that, it’s a very manual process for you. This is going to eliminate it. So yes, software does cost money, but it saves you a lot of time and since your policies are built in, it’s going to be saving you money at the end of the day.

So, I highly recommend looking into a software to streamline this When the software is built out, when we think about it on the travel side, when employees go into book a flight, a hotel or a car, their policy is automatically going to populate. So when we think about making a travel policy accessible, this is a really great way to do it where they go in, they’re searching Boston to LAX and they can see my policy says I can spend $500, it’s right in their face. There’s no questions to be asked. If they spend over $500, you can typically set it up for it to be routed for approval. So somebody needs to say, okay, you can spend $500 over $500 because your reason is legitimate, or they can say no, please find a new flight. So you’re capturing those policy violations at the time of booking through a travel platform.

On the expense side, there’s a few different ways to start capturing the policy violations. For those of you that said that you’re seeing your policy violations when people are submitting the expense or within a month, my guess is you’re probably using an expense platform because when people submit it, what you can do on the backend is build in the policy once again saying if there’s a certain amount they can spend on a category or if there’s a certain amount they can spend monthly, you can start gathering that information and then when they submit the expense report, as you see the images on the screen there, it will flag this expense is $40 over policy because of X, Y, Z reason. And then when it gets routed to somebody for approval, they’re going to see it’s out of policy. They’re going to see why and they can approve or reject the report.

This way you’re capturing at the time of people submitting expenses, there’s other ways where you can capture the policy violation at the time of the expense. I know no one on the call today said that they were doing it that way. When we think about it that way, you’re really thinking about it on the card side of things. So if you can build in policies through your card platform of how much people can spend each month, some platforms you can link it to the MCC code. So if they can spend $500 a month against the meals MCC, then that way their card would just stop once they spend it. So there are different platforms like that out there that you can stop it at the time of spending. Most expense platforms similar to TravelBank, it’s capturing at the time of the expense being submitted.

So, there’s a few different routes you can go that way a lot of times too. So when employees are submitting expense reports, they will immediately see why their expense is out of policy. So that also creates this feedback loop where if they go to spend the next month, they’re like, oh, I got in trouble for that. I was out of policy last month, I’m not going to do it again this month. So it’s very much in their face versus in six months if they have a conversation because they’ve been spending a lot saying, well five months ago you overspent on parking, why did you then overspend the following month? And maybe they just didn’t know. So going back to those policy violations, not being intentional by using a travel and expense platform, it will just have it in their face where they hopefully will not make that mistake in that violation the following month. So I will say that if a manager has 10 direct reports who are traveling all the time, it takes a long time for them to go through those reports. So if you can automate it, you’re going to be saving a lot of time for your team.

I know that was a lot of information and there were some questions that came through. So would love to dive into some of the questions that you all have and then any other questions that have come up during it. Stephanie, I believe that you can throw the questions in the chat too.

Stephanie:

Yes, I’m so excited. So let’s start with how often should our TN policy be reevaluated and updated? Any advice on how to set realistic guidelines with travel pricing fluctuating so much?

Kate:

Yeah, absolutely. So the first part of that, I would say looking at your travel and expense policy minimum once a year. If it is a brand new policy for you, I would look at it quarterly. The reason I say to do it a little bit more often if it’s new is to see you want to go from the too hot or too cold to that just right bucket like we talked about and new policies. Typically we start to see trends very quickly of when to adjust it. If it’s a policy that you’ve had in place for a while, it’s working very, very well for your company. You haven’t had significant changes in headcount or emerging spend categories or emerging trends, you can probably look at it once a year and that will be plenty. And then that second part too. So advice on setting realistic guidelines.

So yes, travel pricing fluctuates so much by the time. If you were looking at a flight when we started this call and you’re like, oh, I’ll book it after the call, that flight price could have already changed. So, using a platform like TravelBank or anyone else for travel bookings, you can typically add in dynamic trip budgets. So what that means is it will build an algorithm to say, if you’re searching from New York to la, this is the budget that we’re suggesting based on your parameters. So if your parameters are economy and nonstop flights, and then if you add in dynamic trip budget, it’ll let people book maybe $50 over the lowest or 10% over the lowest amount. So that’s going to help when people are, with the flight prices changing very frequently, it’s going to help people be able to adjust with it, knowing that if I book today versus I book tomorrow, the flight price is probably going to change, but I’m still getting the flexibility to book what I want with dynamic trip budget. So I would really think about it on that side of how much you want to let people spend over budget and know that it will adjust based on the flight price.

Stephanie:

Thank you. I think you covered actually the second question of how to set price limits with the price adjust and goes up between the time employee searches for flights and the manager gives approval to book it.

Kate:

A little bit more to that one too. So the biggest thing, when we do think about the approvals for people to book a lot of platforms, the booking will not go through until an approval is granted. So keeping in mind in your policy too of if you want to put in saying managers, you have to approve it within 24 hours. Just knowing that the flight price is going to change really quickly, I recommend doing that just to keep all parties accountable.

Stephanie:

Kind of on that same related topic, we had a question come in of have you seen good solutions and policies for time of booking? Meaning if people make plans early and book flights early, it’s usually more cost efficient.

Kate:

Yeah, that’s a big one. What we typically recommend and what you can do in travel platforms is say people need to book within a certain amount of days before takeoff. We recommend 14 days or more out for those. If you all are traveling to go to the CFO Leadership Council conference that Stephanie talked about at the beginning, you’re going to know in advance that you’re going so book as soon as you can. But at the end of the day, business travel is just not predictable at times. So if you can put in your policy to have people book 14 days out or more, that is ideal, 30 days are out is even better, but that’s just not as practical. You would start to see a lot of just changes in cancellation. So 14 days in out is what I would recommend.

Stephanie:

We had another interesting question of going this idea of how do you hold folks accountable for policy violations? Is there some sort of punishments that should be given or executed?

Kate:

Yeah, I don’t know about punishments, but typically what you can do and what I recommend to clients is I’ve heard it called the naughty list, where if people are looking at their violations for booking out a policy, seeing if it’s a trend, looking at that on a quarterly basis and see who’s on your naughty list, and then having those very real conversations with them the same way that you would with any situation at work where people are not following your company policies. Policies are created for a reason. As long as the policy is accessible to people, there is no reason that they should be violating it. Yes, you do need to understand violations may have to happen once in a while, but have that real conversation, bring in that data and say in the last quarter you booked seven trips, six of them were out of policy.

Why? If you’re using a travel platform, you’re also going to be able to capture at the time of booking why it’s out of policy. So you’ll have that data before, but you’ll get that information from them. And then after you have that conversation, see what they do in the next quarter if they’re still going over policy frequently. I have seen companies tell people that they can’t travel anymore. So you can bring it to that if you need to, but by using a travel platform, you’re going to have the data, you’re going to have the backup for it. And 98% of the time, I will say when companies have said they’ve had those tough conversations, it’s changed their trends. So the biggest,

Stephanie:

I like the idea of a naughty list. I think that’s a great way to approach it and real conversations are always needed.

Kate:

Yes, I know. So you can call the report the naughty list. We’ve definitely heard it called that before.

Stephanie:

I am going to throw one more question your way. If our company has a credit card dedicated to booking flight slash travels, how can we enforce staff to use the company card versus their personal card?

Kate:

Oh yeah, that’s a good one. Especially if your company card gets you a lot of different perks. So that is the biggest reason you want to enforce it. So two ways. If you’re using a travel platform, you can build, put that card right in there and you have it in your policy, you have to book on this card. Another way too is if you aren’t using a travel platform, once again, putting it in that very accessible travel policy. If people are putting it on their personal card though, and it is clearly in your policy, you cannot use your personal card, don’t reimburse them. I’ve seen clients do that a lot where they say, if you put on your personal card, you will not get reimbursed for it and that works. But I recommend if you have a company card, push your travel to it because you are going to get rebates. You’re going to get so many perks. So add that into your policy and it’s kind of tough, but just don’t reimburse people if they don’t follow that policy.

Stephanie:

Thank you, Katie. I do want to close it out and I wanted to give you any chance to leave a closing thought for the audience.

Kate:

Yeah, I just want to thank you all for taking the time to listen to me listen to the travel and expense policies. We went over a lot. So this presentation will get sent out. Definitely take a look at the different topics that we spoke about and look at your data and see if you can use any of your data to tie back to this conversation and be able to save your company money. But thank you all so much and it was awesome talking with you today.

Stephanie:

Thank you, Kate. And of course, the entire TravelBank team, like she mentioned, we’re going to reach out post event email, which will include the full link to the recording, the presentation, and a handout with more information on TravelBank. Encourage you all to look out for it and keep the conversation going. This does conclude today’s program. Until next time, stay cool and stay connected.