Reinventing the System: Ensuring that Travel & Expenses do not become a Company's Worst Nightmare
By Nicholas Evered, Senior Vice President and General Manager, Concur, Asia Pacific
Lost receipts, duplication of claims, late submission of expense reports, if these are regular occurrences at your company, it is safe to say that something is amiss with your T&E system.
Findings from a global research show that, on average, T&E comprises 10 percent of a company’s operating expenditure (OPEX)– one of the largest spend item. Given that T&E makes up a huge chunk of a company’s expenses, it is worrying that it has been identified as the second most difficult OPEX to control. What’s more worrying is that an average of 20 percent of claims are usually non-compliant or out-of-policy. To put these percentages into perspective, if your business’ total OPEX is US$100 million, T&E on an average will be US$10 million (10 percent of OPEX), out of which a whopping US$2 million will be out-of-policy spend! That is hardly a healthy figure for any business to be losing.
"From day-to-day communication, conferences and social media, employees expect fast and practical tools in every aspect of their work"
Despite this, businesses are reluctant to forgo archaic and time-consuming T&E systems, such as paper reporting and semi-automated systems, for a variety of reasonsincluding worries about cost and infrastructure.
Whoever said money isn’t everything hasn’t been acquainted with the job of an accountant. Apart from being in control of non-compliance factors including fraudulent claims, a good T&E system is able to tell a business’ real spend. With this information in hand, business intelligence can be improved. For example, having insight into how much is being spent with the same supplier enables a company to obtain better pricing from these regular vendors.
Managing the T&E function of a business well does not only save costs but also saves time. Employees spend an inordinate amount of time during and outside of work hours trying to reclaim travel expenses, looking for lost receipts and attempting to recall the details of each spend.
Additionally, with a generation of mobile-savvy millennials entering the workforce, mobile connectivity is essential. However, mobile connectivity is not just an integral part of a millennial’s life. The digital world has become the workplace norm. From day-to-day communication, conferences and social media, employees expect fast and practical tools in every aspect of their work. Paper expense reporting is the exact opposite – slow, tedious and frustrating. So how did T&E get left out of the technology loop?
By integrating mobile technology with T&E capabilities, expense reporting becomes real-time, bringing convenience, speed and seamless reporting for user satisfaction.
More convenient options as well as online deals are resulting in employees turning to direct booking with suppliers as opposed to going through corporate travel partners. This results in no trace ability of the employee’s location. What we need is a T&E system that can capture all travel information, no matter where the booking takes place. Employers have real-time location of their employee’s where abouts. To top it off, finance teams are able to capture the big spend picture upfront as opposed to retrospective budgeting by analyzing post-spend trends.
In short, a good, smart, real-time T&E system will provide full visibility, faster processes, and greater efficiencies across the board while ensuring compliance with your company’s T&E policies.