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How to cut unnecessary travel through flexible work

A six-step programme for companies

Just about all organisations carry more costs than they need to because too much time and money is spent on travelling. Every now and then finance managers may throw a fit, and measures are put in place that have some effects at the margins. But work-related travel keeps on rising.  Usually only business failure will bring it down.

The reason initiatives to tackle rising business travel usually fail is that they try to tackle travel itself, rather than the causes of it. Work-related travel is generated by the ways we work, and the places we choose to do it. And for the most part, these root causes are not seriously questioned.

Here we provide a step-by-step guide to understanding the full costs of travel, and how to reduce them using new ways of working.

1.  Counting the cost

Nothing persuades quite like a good argument based on a strong factual basis (- something that several world leaders are currently finding difficult to understand as I write).

Changing the way people work is no small undertaking. And it will require some investment to make the savings.  The evidence base must be substantial. So for this reason it is important to build up a picture of the total travel costs. These consist of:

  • direct travel expenses - petrol, mileage, tickets, meals, accommodation, etc: i.e. everything usually counted under travel expenses
  • time costs - the salary costs of people while they are being unproductive or less productive in transit
  • travel investment - e.g. in company car fleets, leasing arrangements, parking spaces, etc
  • travel administration - time spent in organising travel, processing and reimbursing expenses, etc.

Take for example 4 people coming to a 2 hour meeting, each travelling for an hour each way. 8 hours travel, a days worth of productivity, has gone into just travelling for the meeting.  But more than that, additional direct and indirect administrative time has gone into it. The results may be worth it. But how many people coming away from a meeting would say that it true in most cases?

And the 2 hours of the meeting. Are they truly justified as the time needed for doing the business? Rarely so.  The value of this time is hard to quantify: but what is the cost of the "padding" of the meeting - the sharing of information that could more easily have been sent ahead online, not to mention the posturing and the waffle and digressions.

It's important to look on travel in a neutral way, however, and not to demonise it. Business travel is associated with many positives for the business - meeting clients, solving their problems, selling things to them, developing new partnerships, managing effectively across sites, and so forth. The question is not "Should we do it?", but rather, "Are we doing much more of this than we need to?"

2.  Auditing the "drivers to drive"

The compulsion to travel is not derived simply - or always logically - from working practices. The compulsion is often psychological, and embedded in the workplace culture.

The following slide outlines a range of factors that may contribute to unnecessary travel:

Just to take a couple of examples from these: many organisations require all managers above a certain level to be able to drive. There may be some reasoning in this, depending on the nature of the business: but often it's historic and habitual. And company cars are often part of recruitment packages.  In these ways an expectation of driving can be built in to jobs.

There's also a psychological component to the way we think about meetings. The concept of "meeting" implies place, and physical encounters - and so a need to travel. But this is no longer necessarily so. A meeting should be about activity, rather than location.

These activities can be carried out remotely, using a range of technologies. Various kinds of online collaboration (see below) can replace the physical meeting and its attendant journeys.

The value of the "drivers to drive" audit is threefold:

  • It helps to build the business case for change
  • It has a crucial awareness-raising value amongst managers and staff, who begin to identify areas of inefficiency in working practices and workplace culture, and so breaks down barriers to change
  • It begins the process of identifying alternative ways of doing things.

3  Identifying requirements for new ways of working

The solutions for reducing business travel are likely to fall into the following categories:

  • Online collaboration (to replace many meetings)
  • Videoconferencing
  • Remote diagnostics and monitoring
  • Various forms of telework that will reduce repeated trips back to base and enable shortest-route trips, e.g:
    • from the nearest local office
    • when on the move
    • from client sites
    • using home as a base

Examples of the kind of savings possible include:

  • Yorkshire Water 20% annual mileage saving by engineers, mainly due to fewer trips to office
  • RM Consulting 145 employees reduced business travel by 500,000 miles over 2 years
  • IBM 13% reduction in travel time, 36% increase in time spent with customers
  • Royal Bank of Scotland - which has calculated that it saves more than 70k per month by eliminating corporate travel through the use of video and audio-conferencing.

(Cases cited in ICT and Travel Plans report.)

One large national broadcaster used to bring regional mangers into headquarters for a monthly meeting.  It invested just under 200k in top quality videoconferencing technology to reduce the meetings to 2 per year. Within the year the new system had been paid for out of saved travel and accommodation costs.

Thinking about the alternatives to travel inevitably highlights deficiencies in systems that will support remote working. If current IT systems regularly fall over, or are incompatible with each other etc, staff will be sceptical about using it more extensively.  Organisations need to prepare themselves, their systems and their business processes for extensive remote work.  And they need to identify the costs.

It is also possible that comapnies do not have the in-house experience to identify the necessary systems and develop roll-out plans, so consultancy costs and outsourcing arrangements may need to be explored. But having at Stage 1 identified the total costs of travel, investments can be planned against future savings.

4.  Piloting and quick wins

Nothing will sell the case quite like seeing it in action. Potential quick wins should be identified in areas where there are good opportunities to reduce travel.

This gives the opportunity to test any new technologies and working practices, to monitor, evaluate feedback and to make appropriate adjustments. Piloting can also provide a sound basis of evidence for setting targets for travel reduction.

It is always the case, however, that the needs of different departments will vary, so results are not necessarily simply transferable to all other departments.

5.  Roll-out plan,  policies and targets

On the basis of the evidence gathered and the pilots, a plan for rolling out the new working practices can be developed.  It is worth noting that there may be some synergies policies to reduce staff commuting and with meeting the requirements of new employment law which allow a right to request flexible work.

The roll-out plan will also need good levels of cooperation between operational, HR, IT and facilities managers, and so will need support from the highest levels to overcome barriers and departmental agendas.

Having already identified the cultural factors that encourage unnecessary travel, it is important to replace them with appropriate policies that encourage and support new kinds of flexible working.  A checklist of these can be found in our Complete Guide to Flexible Working.  Needless to say, our advice in the Guide to integrate new ways of working with clear business objectives equally applies when one of the main objectives is to reduce travel costs.

Targets are important too.  By this stage of the process there should be a clear understanding of current costs and potential savings.  Targets should take the form of reducing travel by n% by such-and-such year, or reducing travel n% year-on-year over a specified number of years.  Targets can be set at company, department and/or team level.

Other targets may be more financially focused, and may concentrate on a particular aspect such as scaling down or ultimately eliminating company cars.

6. Roll out the new working practices

After all the preparation, the easy part! Based on clear business objectives and a "cultural clean-sweep", flexible working ought to progress much more smoothly than it would have done otherwise.

But there are bound to be issues and gremlins that arise. So flexible working should be seen as something which is continually evolving.  With new and better technologies and a changing business environment, it is also likely that options rejected at an early stage may become more viable over time. So a system of review is advisable so as to maximise the benefits.

Hopefully the result won't be that your staff are climbing the walls because they never get out of the office!  Instead, they should be happily working wherever is most effective to get particular tasks done. And your company's travel costs will be well under control.


Further Information

In other articles on Flexibility we report on research into travel reduction through telework and other online activities.

Here we get seriously practical, and tell you how your company can do it.

If you would like further assistance with tackling this issue in your organisation, please contact Bob Crichton
Tel +44 (0)1223 264485

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