Published on : Wednesday, July 12, 2017
Companies believe travelling to be quintessential for expanding the top lines, bottom lines and the customer base. Although some regard it often leads to inefficiency, employees adhere to being comfortable while on road and try to gather money focusing less on the profits.
Dan Ruch, founder and CEO of Rocketrip mentioned that corporate investments can be saved once the employees are sensitized about how to save the money while booking for travel.
He further added that the employees can be motivated in two ways, intrinsic and extrinsic. The former is associated with some material value while the latter brings in some feel good factor.
However, motivation in the corporate travel has to be a bit trickier, for instance there is a policy for employees to fly business class. Persuading them initially might look as an intrinsic motivation which gradually takes the form of status on a leadership board. This happens until a travel agent creates a situation that steers the employees in doing what is good for them.
In order to change the things at the macro level one has to counteract what will actually be given and it is seen that financial incentives is a powerful motivator of human behavior.
Ruch further added that getting the right value exchange can be a challenge for corporate travellers. Modern corporate travel policies expect the travellers to stay in a certain place and are not bothered about where they hang out.
Employees lack the motivation of saving as they are spending the company’s money and don’t feel like ‘sacrificing’ for the company, they adhere to the fact that they are the ones who are battling it out. Corporate travel policy spends around $1.25 trillion each on flights, hotels, cars and trains and the employees have no intention of saving money.
Travel manager can tighten the expenditure but this might lead to a tiff. However, the operative part here is the cost and how in the long run it will help the employees in switching behaviours.
Ruch has devised a plan for his own company where an employee gets a reward of fifty percent of the travel’s saving and the rest accruing to the company. Client company’s uses technology to manage travel, their corporate policies and a ‘budget to beat’ determined from the clients data. ‘Budget to beat’ is a tentative assumption of the employees expenditure had there been no incentive to save.
The trips can be tailored by optioning for cheaper hotels or flying in the economy class, the employees will be reimbursed at the end of the trip and the points will be substituted with dollar or redeemed with things.
Ruch observed that the employees behavior had changed trips were booked well in advance that resulted in cost savings between 20 to 30 % ensuring a mutual benefit.
The employees turn enthusiastic participants and get vocal about cost sensitivities in the organization and they do it because there is something in it for them.