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Are Executive Travel Policies Being Followed?

Creating and following travel policies that limit the number of executives that may travel together is prudent, but the added cost may prevent most companies from implementing them.


Creating and following travel policies that limit the number of executives that may travel together is prudent, but the added cost may prevent most companies from implementing them. June 21, 2010

Travel policies limit the number of executives that may travel together.

Travel policies limit the number of executives that may travel together.

Putting together a quality team can take years. Losing them can take seconds.

The tragic death of Poland’s president, his wife and other high-ranking offi cials, including the army chief and head of the country’s central bank, in a plane crash in April, showed the world how quickly a leadership team can be lost.

“When that happened in Poland, one of the fi rst things on my radar was, ‘Wow, how could this have happened?’ Because it’s one thing for a business to have to deal with it, [but] it’s another thing entirely for a country to have to deal with it. I hope that makes people sit up and take notice, but my guess is, it probably did for about eight minutes; then after that, you go back to living your own life,” says Helen Van Dongen, CMP, CMM, Toronto-based director of global conference planning at RBC Capital Markets.

The crash probably had many planners dusting off client travel policies to see a) if they existed and b) if they were being followed.

While that crash may not have occurred close to home, it began a discussion relevant to any meeting or travel planner: Should we be complacent in emergency planning? Or should we develop and implement travel policies?

It is often said that fl ying is safer than driving to work. But many of the international legacy airlines favoured by business travellers have suff ered horrifi c crashes.

On Sept. 2, 1998, Swissair 111, a McDonnell Douglas MD-11, crashed into the ocean near Nova Scotia, killing 229 people. In August, 2005, Air France Flight 358, carrying 309 passengers, slid into a ravine at Pearson International Airport in Toronto and burst into flames. Luckily, no one died. And for Pacifi c Gulf Airlines, in B.C., 2008 was a tough year. The airline suff ered two crashes, one in August, in which fi ve crew members died on their way to a logging camp, and another in November, where seven passengers, who were part of a team headed to the Plutonic Power Hydro site, were killed. The Vancouver Sun reports B.C. accounts for more than half of deaths from aircraft accidents in Canada because of the number of small planes fl ying over the mountainous landscape.

RBC Group’s guidelines, for instance, state that no more than three members of the executive committee, or four directors, or a combination of no more than six members of both groups, can fly together on the same aircraft , whether it’s a charter, corporate jet or scheduled airline. Less-senior staff members are limited to 12 per fl ight.

Van Dongen, who isn’t responsible for booking flights, says, “I can tell you that absolutely people don’t abide by this. It’s simply because of the nature of our travellers. We end up doing a lot of rebooking because people make changes in their itineraries right up to the moment they fl y. So because some of our guys fl y private and because they just want to get there when they want to get there and they don’t care what the rules say, I am absolutely sure that the rules are broken more often than not.”

She continues, “My own view is that if people are booking their air with Carlson Wagonlit, our travel provider, then undoubtedly Carlson is doing or attempting to do what’s refl ected in our travel policy. If our people are booking their own travel — I know they’re not supposed to but it happens — or if they’re fl ying private (plane), then there’s nobody to crack the whip and say ‘Hey, wait a minute, the rules say this.’”

Adhering to such policy limits is a challenge in an era when airlines, like United and Continental, are merging, route-sharing or reducing capacities. Van Dongen says, “Nobody likes to change planes. So if there’s one direct fl ight between Toronto and Phoenix in a day and I’ve got 200 people who need to attend a conference and they’ve got two days to get there, I’m going to have more than 12 people on a plane.”

Many professional fi rms, like Deloitte Management Services, in Toronto, whose assets are their talent pool, have policies. Deloitt e looks at how many senior managers are travelling to the same destination and arranges travel on a case-by-case basis, says a company source.

In Vancouver, Kelly Revell-Drdul, general manager of Uniglobe Specialty Travel, says a number of her clients have travel policies which limit the number of participants on a fl ight. “One of our clients has a 12-member executive leadership team. Only five of them can travel together at one time.”

These policies protect the company, but aff ect the operational budget. In 2009, one of Revell-Drdul’s clients took 50 store managers to Hawaii. Policy required the group be split in two “and they all wanted to be there on the same day, so I had to send half on Air Canada and half on West- Jet. Believe it or not, WestJet was $400 more per person, so that was 25 people at $400 more a person.”

The cost of smart travel policies

Ticket-price variations are only the start of the additional costs. Next is ground transportation. For a client’s Hawaii trip, Kelly Revell- Drdul, general manager of Uniglobe Specialty Travel, had to arrange for two motorcoach hires instead of one. Some planners say such costs can be as much as 30 per cent of the budget.

Francis Pare, an account manager at Montreal’s Zeste Incentive, agrees. The cost escalates when attendees arrive in waves. This is to be expected from people with busy schedules, which prevent them from travelling on the same fl ight. “If you have 50 people travelling from the airport to downtown and they all come in on the same fl ight, you can get a 56-passenger motor coach. It will cost around $800. If you do it separately, each transfer is $92, so with just 10 people coming in separately, you’re already over the budget for carrying 56.”

The bottom line: Limiting the number of participants allowed on a single aircraft will cost you more, but needs to be weighed against the costs of rebuilding a company, of replacing top performers and best customers, or losing the top management (which for some planners, may mean their client).

Spreading the risk and paying the extra cost is like insurance: you buy it hoping never to need it.

For example, to transfer 50 people from the airport to downtown:

a) One 56-passenger coach = $800

b) 50 individual transfers @ $92 each = $4,600 Therefore, the cost of smart travel: $3,800

— Allan Lynch is a New Minas, N.S.-based freelancer writer



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