If you’re like many companies, you, in the spirit of budget-cutting, slowed down employee travel in 2010 — or even halted it altogether. According to a new CareerBuilder survey among more than 2,400 U.S. employers and more than 3,900 U.S. workers, 30 percent of companies say they cut back on business travel last year — and it wasn’t such a good move for many of them. Of the companies who cut back on travel, more than one-third (37 percent) said it negatively affected their business. Have you had a similar experience?
Lack of business trips and the bottom line
Budget cuts can often have ripple effects in other areas of the business. Many businesses who cut back on travel in 2010 had fewer opportunities for face-to-face meetings, leading to communication issues, hurdles in fostering client relationships, and, ultimately, fewer sales. When asked how fewer business trips affected their bottom lines, companies reported the following results:
- Less effective internal communication: 12 percent
- Fewer sales: 11 percent
- Less effective execution on internal business initiatives: 10 percent
- Less customer loyalty: 8 percent
How will this year be different?
Based on 2010′s results, will companies alter business travel frequency in 2011? For the most part, it appears they won’t. The majority of companies (77 percent) report business travel levels will stay the same as last year. Eleven percent said their companies will take more business trips this year (perhaps to counter the negative effects of cutting back in 2010), while 13 percent said business travel will decrease.
Although frequency of travel may be “business as usual” in 2011, many companies have started taking a different direction to help cut unnecessary expense: Altering the way that employees travel.
“Business travel is an important part of many companies’ operations as it lets them stay connected with clients and employees across the globe,” said Rosemary Haefner, vice president of human resources for CareerBuilder. “Some companies are revisiting their policies, though, to ensure they’re maximizing the effectiveness of their business travel initiatives.”
How are companies keeping a closer eye on travel expenses?
- Taking out the extravagance: Nearly one-third (32 percent) of companies are placing specific restrictions on business travel for employees since the recession, asking them to fly coach, lowering entertainment budgets, and having them only travel domestically.
- Virtual meetings: Forty-two percent of companies said they rely more on phone/Web conferencing now to conduct business with clients, with 31 percent saying they get just as much out of virtual meetings as face-to-face meetings.
Tell me — has your business cut down on employee travel, or otherwise changed policies around travel to cut costs? What has worked well — and what wouldn’t you do again?Related