Angus Milledge, Head of New Business EMEA, SAP Concur
For decades, organisations have been automating financial processes. Whether it’s expenses or invoicing, using digital tools to track finances in detail is an asset to any business. However, solutions in place are often outdated or not fully integrated. Relevant data can therefore often be dispersed, making it difficult to accurately track and get true visibility on financial information.
If businesses don’t keep up with trends in travel and expense (T&E) management, they risk being left behind and exposed to unforeseen risks. Taking action now can eliminate these risks and place the organisation back on the leading edge.
So, what should companies be aware of to not lose out on money?
- Employee spending habits are changing
The way employees spend and submit business expenses has undoubtedly changed. Spending categories that were previously under company control have shifted to employee control, leading to a more autonomous, employee-led way of keeping track of expenses.
Furthermore, suppliers are marketing directly to employees, encouraging direct purchasing. Employees are using new ways to book travel and accommodation. Company cards are used for more than just travel expenses. The diversification of payment methods and booking tools is creating more disconnected silos.
The effects are widespread: cost management and the growing complexity of financial forecasting and budgeting are the biggest internal challenges that finance leaders are facing. They are struggling with blind spots when it comes to their company’s expense, travel and invoice spend. This is being bolstered by time being wasted and money being left on the table, for example by missing out on VAT reclaim opportunities.
Moving into a fully automated, connected T&E and invoice system with cloud-based, mobile-optimised tools can encourage adoption and increase compliance with company T&E policies. Employees are more incentivised to make responsible spending decisions while managers gain complete visibility on any excessive, fraudulent or unnecessary costs. For the business, that means less fraud and more funds.
- Regulations and laws are more dynamic
Regulations and tax laws are in a state of constant flux and companies working internationally face country-specific environments to operate with. Keeping up to date and playing by the rules is a key challenge for every business. The risks of financial crime, data breaches and regulatory infringement place extra importance on transparency, data integrity and internal auditing.
Fines aren’t the only risk when it comes to finance management, however. According to the SAP Concur Business Spend Insights report, companies lost $5.2 million on misclassified or missing receipts in 2023.
The cumulative risk makes it more important than ever to take a connected approach to business expenses. By adopting integrated T&E systems and maintaining compliance, businesses can improve the robustness of their spend data and reporting, as well as spot red flags earlier on.
- Digital transformation is the new kingmaker
Technological advancements such as AI, machine learning and mobile services mean finance departments are considering how to refine their processes to deliver greater productivity. Increased pressure demands a more strategic outlook, shifting focus to bringing value to the organisation and driving solutions for growth.
Businesses still using older systems to manage employee T&E are losing time to menial tasks. According to Gartner, Chief Financial Officers (CFOs) rely on technology for monitoring performance and informing business decision-making using quality data. Updated technology allows for greater visibility, which can capture opportunities for early payment discounts and support contract negotiations. By properly informing strategic decision-making, organisations can minimise operational and financial risks.
Technology can ensure all transactions are captured from every payment method, streamlining multiple channels into one source of truth. Employees today expect consumer-like experiences at work, and where there’s a shortage, they can miss opportunities to contribute to overall company vision and strategy, leading to dissatisfaction. Finance or accounting employees can save up to 13 hours per week on T&E and 12 hours on invoices, according to Analysys Mason.
By modernising and optimising processes, finance teams can keep ahead of the curve. Digitally transformed systems allow businesses to keep abreast of market developments, as well as increase compliance and minimise the risks of employee dissatisfaction.
It’s an investment in your long-term future – and it comes from upgrading technology.
