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Who's the Boss?

Keep your company's travelers in line with a clear-cut business travel policy.

Managing your company's travelers is almost like managing kids--both need clear boundaries. If you're finding it increasingly difficult to rein in travel expenses (typically the third-highest controllable cost at most companies), it's time to set those boundaries with a travel policy. Here's how to get started:

  • Review recent expense reports and talk with your most frequent travelers about their travel patterns, preferred hotels, airlines and car rental companies. If you engage your travelers in the policy's formulation, buy-in will be much easier.
  • Based on their input and your need to control costs, write a travel policy that establishes boundaries such as maximum allowable hotel rates, rental-car size or use of low-fare carriers. You can set per-diems for food, beverage and entertainment expenses; determine a fair per-mile rate for business use of personal cars; choose whether to allow for extraneous expenses like in-room movies; and determine specifics, like whether receipts are required for all expenses or just those over $25. Your policy should also spell out rules about securing management approval prior to booking the trip.
  • Choose a single travel agency, and require travelers to use it exclusively to book all business trips. Depending on your company's travel patterns, you can choose to use a traditional travel agency or one of the new online business-travel booking services from Expedia, Orbitz or Travelocity. A single agency helps you to ensure policy compliance, track unused tickets, collect data for negotiations with suppliers and easily locate travelers in an emergency.
  • Tired of sorting through a stack of receipts from employees seeking reimbursement for business-trip expenses? Create a standardized form that itemizes expenses for each trip, and tell employees they must use it to get reimbursed. You can also invest in expense-management software programs. These programs are numerous, and one size does not fit all, so check out several. Start by typing "travel expense software" into Google.

Chris McGinnis is author of The Unofficial Business Travelers' Pocket Guide.

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This article was originally published in the September 2005 print edition of Entrepreneur with the headline: Who's the Boss?.

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