How to get better ROI on business travel.

It’s official: business travel is increasing again. According to Deloitte, spending for corporate travel is expected to reach 2019 levels again by late 2024 or early 2025, with in-person attendance at industry events driving the bulk of the spending. What’s clear is that in the ongoing post-pandemic recovery of the last few years, business travel is poised to meet and even surpass its pre-2020 levels. Executives at all levels, from CFOs to travel managers should be prepared to adapt to these changes — creating opportunities for their employees to meet in person while still keeping costs under control.

In July 2023, we surveyed more than 200 travel and expense management decision-makers at US companies, and not only did they confirm these trends but also offered insights into what’s driving the recovery and how current patterns have made the management of business travel more complex.

Here are the key considerations for finance leaders like you who are in the same position and need to ensure they are tracking travel, automating controls, and improving ROI:

To increase the ROI of travel, you need to improve the business outcome or decrease travel costs — or ideally both at the same time. The way you do that is with an integrated T&E solution that is easy for employees to use, automates more of the process, and automatically enforces policies to keep everyone on budget.

Below, we dig even deeper into what the data tell us about the state of travel today, and how businesses can implement solutions that solve today's common business travel challenges.

Among our respondents, they identified a dozen different T&E solutions in use, ranging from legacy vendors to market disruptors. A common set of complaints emerged, with many stemming from a lack of automation and limited visibility into overall costs and returns. Other pain points included:

These difficulties are compounding on each other now that travel is coming back quickly. They have the potential to impede the productivity and efficiency of employees distributed globally; overburden managers and accounting teams; and lead to poor compliance, leakage, and low travel program adoption.

Improving ROI on business travel isn’t just closing the deal when you get to where you’re going. It’s also about how much you spent on the trip and the systems that enabled it. Unfortunately, many companies aren’t clear on their travel program costs, which inhibits their ability to calculate the ROI of business travel.

Some 88% of leaders said cost savings and travel management fee reductions are a priority, and that they wish to implement strategies like restricting employees from booking expensive flight classes and requiring advance bookings and preapprovals for going over budget, two tactics used by 44% and 42% of companies, respectively.

Among our survey respondents, only 58% said that they understand all their fees, while 39% said they understand some but not all. When it’s a herculean effort just to find out how much you're paying for your corporate travel program — and you’re paying multiple SaaS bills for different types of spend — you’re constraining your ROI before anyone even sets foot on a plane.

Companies are addressing travel budget overages and actively trying to rein in travel expenses without cutting back on important and business-critical trips and group events. In fact, 62% of respondents to our survey said that actual travel costs in 2022 were higher than projected, with 20% saying they were significantly higher.

Part of the challenge is also that some companies are still settling into the groove of a distributed workforce. The fully remote companies that we spoke to said actual costs were higher than they had expected, and half of them said costs exceeded projections by a whopping 50% or more.

All of these shortcomings of T&E solutions have led companies to understand exactly what they want in a corporate travel solution. Survey respondents have set a high bar for their dream T&E solution and show a strong desire to consolidate SaaS spend:

That last point is critical. One of our respondents’ biggest priorities: wanting all of their T&E functionality to be fast and automated. Finance leaders expressed a strong desire for AI-enabled automation, which can offer time-saving features like auto-enforced travel policies that simplify compliance, instant approvals of in-policy spending, and the auto-population of receipts.

A strong motivation for this pursuit of automated compliance is accounting automation. When compliance is automated through auto-enforcement of policies, automated receipts, etc., accounting teams have everything they need to close the books quickly and cleanly.

Companies are actively trying to rein in travel expenses without cutting back on important and business-critical trips and group events. And in a world of advancing spend management technology and T&E software, leaders shouldn’t be forced to decide between costs and collaboration.

Based on the data we gathered, these are the five overarching considerations and recommendations we compiled as you aim to increase the ROI of your travel program:

Organizations should look for AI-powered travel and expense solutions that make it easy to automate T&E cost controls and detect savings opportunities rather than require manual expense reviews and cost-cutting measures, which are highly tedious for employees, managers, and finance teams — and easy for employees to circumvent.

Travel solutions that are integrated with card and expense management software may allow companies to consolidate SaaS costs and embed their policies during travel booking, so employees will only see travel options that meet established rules. It’s the easiest way to control air, hotel, and transit costs and can lead to major savings.

Lastly, it’s important for companies to get a solution that gives them real-time visibility into how actual travel spending compares to budgets, and that provides AI-driven insights and alerts such as automatically detecting and flagging expense anomalies, concerning patterns, fraud indicators, or increases in MoM. This allows them to take swift action and ensure that travel dollars are delivering strong ROI and going to the most impactful purposes.