Corporate fleet and travel departments will merge in the next two to three years as employers adopt a ‘total cost of mobility’ approach, according to one of Britain’s biggest leasing providers.
Driven by a desire to have a complete picture of all journey-related costs, including hotels, meals, car parking, taxi fares, flights and rail tickets, some companies have already made the change. But, many more look set to follow suit, persuaded by the appeal of getting a tighter grip on costs and the emergence of ‘mobility’ platforms, giving access to a complete package of travel-related services.
A survey, conducted by LeasePlan UK and fleet representative body ACFO, suggested that 86% of employers would like a multi-transport booking platform and two-thirds (68%) would welcome a ‘mobility’ card.
It also revealed that one in 10 companies are already using some sort of web-based mobility platform. “That might just be a mobility platform that has trains, planes and hotels, but they are already using the concept of a platform to consolidate mobility,” said Hein du Plessis, head of product development at LeasePlan UK.
Its own studies have highlighted a growing interest in the concept of ‘usage’, with assets shared rather than owned, and a tendency towards subscription-based products and services.
They also showed, according to du Plessis, that separate fleet and travel departments could soon become a thing of the past. “In the next two to three years there won’t be a travel manager and a fleet manager, there will be one,” he told delegates at ACFO’s autumn seminar – Drive for Mobility, held at Fleet Management Live at the Birmingham NEC.
A year ago Ricoh fleet manager Chris Haynes was promoted to the role of fleet and business travel manager. He said: “The synergies between fleet and business travel had become glaringly obvious.”
The fleet and business travel teams were integrated into one operation, with the aim of reducing costs, boosting efficiency and improving employee experience.
Haynes told delegates the company has almost 2,000 ‘lines of travel’ per month which can range from one car or train journey, or flight, to split journeys embracing multiple forms of transport and hotel bookings.
It has now introduced a dedicated online travel portal, with an interactive dashboard, so the cost of every journey can be viewed. Revisions have also been made to journey expense approval limits so ‘best price’ can be achieved prior to booking.
He said: “Employees have been re-educated. Using technology equals cost and time savings and an enhanced customer experience.”
Graeme Banister, consulting director at Frost and Sullivan, believes the re-education of employees could be hastened however, by incentivising them to make the right choices. He explained: “Employees must be empowered to make choices and that can be encouraged by enabling them to share in the savings.
“If you’ve got something which says ‘you can take the hire car for £45, or if you take the car club for £10, we’ve saved £35, so we’ll give you £5’, that starts to get really interesting.”
The message to employees, says Banister, becomes instead “start making money out of your travel”.
He told delegates transport has been treated with a “silo mentality”, but “there is now a move to a total cost of mobility concept and the importance of understanding the full cost of travelling from A to B”.
That view was supported by Justin Whitston, chief executive of mobility as a service (MaaS) platform provider Fleetondemand, which supported the seminar alongside LeasePlan UK.
Describing how a single online platform could be used by organisations and their employees to “find, book and pay” for all travel and related costs, Whitston concluded: “Technology must be able to normalise multi-data sources. The platform must embrace business objectives and employees’ personal objectives, and deliver the best mode of transport for each particular journey.”