Escalating health care costs in the last decade gave rise to managed care. Could managed travel be the answer to controlling business travel costs?
Runzhiemer International Inc. estimates that the median annual cost of business travel for American companies is $1.4 million. Obviously cutting even a fraction of that could mean a tidy savings.
John Ackerman, president of E-Travel Inc., a Concord, Mass., company that produces software for just such purposes, says that to realize travel savings, corporations must establish a travel policy consisting of negotiated rates with preferred airlines, hotels and rental car companies. That’s an arrangement not unlike the type struck by managed care companies on behalf of their subscribers with health care providers.
Ackerman suggests companies can enforce their corporate travel policy through online corporate travel management software tools. His company’s software, for instance, allows automatic booking with preferred vendors.
Companies can work deals with an airline for reduced fares, but such agreements usually stipulate they purchase seats on a specified number of flights. Employees traveling on business, however, often have their own agendas, says Ackerman, and regularly stray from corporate policy to serve their own ends, usually to accumulate frequent flier credits for their personal use.
But will employees gripe if they can’t use their own travel agent?
Find E-Travel at www.e-travel.com.
