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What Is Corporate Travel Management?

By K. Kinsella
Updated: May 23, 2024

The corporate travel management (CTM) department of a company manages all aspects of the travel arrangements of company's employees. Contracts with travel partners, such as hotel chains, are arranged by the corporate travel management group, and employees have to make arrangements for business trips through the travel management department. Major corporations have corporate travel management departments, while smaller companies tend to employ travel agents to provide some of the same kind of services.

Policies related to corporate travel are usually formulated by the travel management group in conjunction with the human resources and finance departments. Major corporations have an annual budget for travel expenses, and the corporate travel group has to ensure that the total cost of employee travel does not exceed the annual budget. Some travel groups assign a travel budget to each division of the corporation, and the departmental managers are responsible for overseeing the travel arrangements of their own employees.

A corporate travel management group normally establishes ties with companies that can provide transportation and accommodation for employees during business trips. Large companies agree to contracts with several hotel chains to ensure that employees can find partner hotels to stay at regardless of where they must travel for business. Companies normally receive a significant discount for group bookings and receive discounted rates for agreeing to work with particular hotel chains and airlines. These discounts are contingent on the fact that the corporate travel group agrees to conduct a certain amount of business with each partner firm. Hotels and airlines can discontinue the discounts if corporations make bookings less frequently than originally agreed.

Employees who have to travel on overnight trips are normally reimbursed for expenses related to meals, laundry, and dry cleaning. The corporate management group conducts research to determine the cost of meals and other services in different geographical regions, and uses this information to establish daily expense limits for employees. Companies only reimburse expenses that do not exceed the limit, although employees are free to spend beyond the daily limit if they use their own funds. Some corporate travel management groups provide employees with corporate credit cards, which enables employees to charge expenses directly to the company rather than submit claims for reimbursement.

When annual expenses exceed the stated budget, the corporate travel management group is responsible for ensuring that company employees change or cancel travel plans for the remainder of the year. Many companies require employees to conduct meetings via conference calls in order to reduce costs. Budgets for travel are reviewed annually and can be increased to accommodate rising prices, but most companies regard travel expenses as controllable expense and tend to keep travel budgets to a minimum.

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