Driving compliance is not a science, it’s an art, because at its very heart it involves influencing human behaviour.

In theory, improving compliance to travel policy should be easier for small to medium enterprises (SMEs). Decision can be made quickly, firms are agile, policies are simpler and there are fewer approval layers.

“SMEs may not have the same infrastructure as big firms, but they do have proximity. Smaller teams mean communication is easier,” explains Vicky Lerego-Wright, Project Manager at Festive Road.

Yet SMEs don’t always have advanced digital platforms and rich data insights with built-in compliance features, not to mention dedicated travel teams and strong supplier partnerships, which are more typical of large enterprises.

Rather than size, success is often down to other factors.

“How easy it is to stay compliant depends on how well each company plays to its own strengths,” states Ann Thomas, Senior Account Manager at Clarity Business Travel. 

What is crucial in this process is how people behave. Businesses that are all about employee autonomy and independence are less likely to stick to the rules.

“Traveller compliance depends more on company culture than size,” explains Kerry Douglas, Head of Programme at the Institute of Travel Management (ITM).

In a poll by ITM, 95% of travel buyers said the most effective lever in supporting compliance was leadership endorsement. If the big guys comply so does everyone else. So the C-Suite is a good place to start.

“We host an annual webinar in which senior leadership share their thoughts on business objectives and how this relates to policy compliance. This resonates well with the wider business,” says one travel buyer.

Control levels

The next question is whether to nudge or mandate. “In the SME space, a gentle nudging approach works best at first,” explains Lorraine Sergison, Account Manager at Gray Dawes Group.

But reminders, educating your travellers and presenting them with data can only go so far. It may ensure a low-friction environment, talent retention and happy executives, but buyers must know when to be stricter.

“Mandating policies, with clear consequences for non-compliance, ensures policy is taken seriously. This can drive immediate compliance,” says Carrie McCabe, Vice President, Enterprise Customers at CWT.

It certainly depends on the industry. Highly regulated and high-risk sectors, where duty of care matters, are more inclined to do things by the rules. Here audits and accountability are high, yet this limits traveller autonomy.

Many businesses use a combination of both, mandating essentials such as booking channels, while deploying nudges to encourage the use of preferred suppliers and good booking behaviours. Setting expectations is important, since it allows travellers to benchmark their behaviour.

“There’s this saying that ‘the standards that you walk by are the new standards that you set’. So, if you let somebody fly First Class once, they probably think they can do it all the time,” points out Cassie Petrie, Managing Director of EMEA at SAP Concur.

“Regardless of a company’s size, it all needs to be written down so people know what they’re entitled to, so they’re empowered to make their own decisions, while adhering to the guidelines.” 

Trickle or flood?

One of the biggest compliance challenges is leakage, whether it is incidental expenses at hotels or inflated car hire upgrades with extras paid for on collection. Education is crucial here, and so is visibility.

This is where good data and reporting comes in via a travel management company. “Many SMEs don’t have the systems or bandwidth to track non-compliant bookings until they hit the expense report. By then, the damage is done,” says John Stephenson, Managing Director at Your Travel Corporate.

Then there are issues with available rates. We’re all travel buyers these days, so when executives find public prices cheaper than negotiated rates via a TMC, compliance issues kick in.

“Changes in how airlines and suppliers distribute available inventory mean fare discrepancies are often now found in the booking experience. The way to address this challenge is to ensure you can have breadth of content available and have the mechanism to deliver this content directly to the end user,” says Sandra Green, Strategic Client Solutions Director at Take2Eton Group.  

With all of these challenges, communication is perhaps the most important of any travel policy. Travel bookers now need to be good storytellers. There will always be travellers who will try to game the system, and persuading them not to is crucial.

“There should be a plan for how travel policies are introduced during onboarding and reinforced during role changes. Travellers need to understand not just what the rules are, but why they exist and how they protect both the employee and the business,” explains Stuart Birkin, General Manager for London and Glasgow at CTM.

“Travellers often believe they’re saving the company money, not breaking policy,” adds ITM’s Kerry Douglas.

Tech trouble

Artificial Intelligence (AI) now has the potential to shift the compliance goalposts.

“I’m now using AI within an expense tool, which sits on top of my online booking tool,” explains one travel buyer.

In this business case, generative AI reads the travel policy, scans expense submissions to identify leakage, and then issues an out-of-policy spending alert to employees. This approach has already generated savings for the firm and nudged travellers to be more responsible, therefore driving compliance. Agentic-style AI has more potential, where it can act and deliver on command. 

“Currently, there’s limited evidence of success, and many clients remain cautious. That said, it holds strong potential for the future,” explains Angela Gallacher, Account Manager at Gray Dawes Group.

What also holds a lot of promise, especially for SMEs, is bringing travel policies to life. Many agree it should be a living, breathing document. The best managers get it. In an ideal world your travel policy must be flexible, reflect current business needs and empower travellers, as well as holding them to account.                        

“For us, the main factor is engagement. When travellers understand and are engaged with the policy, compliance naturally improves,” explains Katie Skitterall, Group Commercial Director, Direct ATPI. “It is so important.” 

Top 10 tips to drive compliance

• Lead from the top: Senior leadership needs to grasp the compliance nettle. If bosses stay in line then staff are more likely to follow policy.
• Company culture: Buy-in is essential. Make sure new starters are introduced to the policy right away. The aim is to create a travel policy that all travellers want to follow.
• A policy fit for purpose: Forget rigid rules. Compliance depends on a flexible policy. Rules should adapt over time as travel patterns change, and be aligned to broader corporate goals.
• Make it easy: Most travellers aren’t trying to bypass rules, but they do need clear and simple guidance. If it’s easy to understand, they won’t go rogue.
• Communication is key: Be clear and transparent when setting out rules. “Outlining the ‘why’ can pay dividends in terms of building understanding and adherence,” suggests Ryan Jackson, Quality Assurance Manager at SilverDoor.
• Education, education, education: Real life examples work. These can be more memorable than hard rules. It helps travellers understand the meaning of a policy.
• Explain out-of-policy risks: Setting out the pitfalls involved in rogue bookings is one approach used, whether it is duty of care or saving the firm money.
• Use an approval process:  A popular approach and highly effective, this also drives the right behaviour since it gives managers visibility so they can track budgets.
• Nudge first, mandate later: Get the balance right. Even strict mandates experience policy leakage. Balance cost controls with duty of care.
• Create a living, breathing policy: Whether it is refreshing people’s mindset or sparking internal discussion, compliance is dependent on an active, not a passive state, within the firm.