Ryan Demaray, MD of SMB EMEA at SAP Concur
The economic crisis has prompted business leaders around the world to re-evaluate spend management. Although reworking budgets will help to control costs, navigating the cost-of-living crisis will require looking beyond today’s challenges.
Few companies will be able to survive this economic period without preparation for longer-term success. For all businesses, the goal will be to stick to a budget to keep expenses in check, including invoices and travel. For employees, they might seek a higher salary to cover the rising costs of fuel, energy bills, food and services.
Whatever the size of your business, it is critical to be proactive about the business spending policy to support cashflow and ensure compliance. To build long-term business resilience, business leaders will need to have a holistic grasp of spending behaviours while also improving employee experience to retain talent.
So, how can businesses decide on what spending cutbacks to make? Let’s look at how technology can turn this challenging economic climate into a great opportunity.
Focus on cashflow visibility
As external costs continue to rise, businesses will need to adjust their expense policies to tighten cost controls and compliance.
It may seem like the most obvious solution but complete visibility into spend will help businesses to eliminate wasted time and keep costs under control. Visibility into spending habits will provide business leaders with confidence that cashflow is being safely controlled, helping to manage fraud and out-of-policy spend whilst also securing better rates or reclaiming more VAT from suppliers.
Controlling the right costs is crucial. Businesses need tools that give them the visibility to understand key drivers for areas of growth or critical success and protect those. Cutting costs as a peanut butter spread strategy can be wildly hurtful but controlling the right costs and fuelling the right activities will help companies operate from their positions of inherent strength, driving profitability.
Businesses can save both time and money by implementing artificial intelligence and other intelligent automation technologies to improve visibility. According to SAP Concur’s Expense Management report, 62% of businesses saying that digital tools helps to manage expenses more effectively across their organisations, making the process smoother for the finance team. Automated spend management can give finance teams a near real-time, accurate view of spend and helps professionals align spend management with their business goals. For example, every employee invoice will go through the correct approvals and be double checked for accuracy.
Additionally, cashflow visibility allows teams to see where allocated time is being wasted, helping them to eliminate laborious and administrative tasks. Through collaboration and integration across departments, business leaders can work with finance teams to align spend management with business goals and unlock a strategy to improve efficiency. This will give employees time to focus on more rewarding and high-value work, keeping them engaged and improving performance and consistency during these tough times.
Streamline internal processes and policies
While cashflow visibility is key to building business resilience, another critical element is streamlining internal processes and procedures. Connecting automated expense, invoice and travel processes together will ensure that spend data flows into one place. This will give professionals better insight to make agile decisions, adapt to change and build additional goals into spending processes. So, business leaders will be able to establish the most effective long-term plans, achievable goals and roadmap to get there.
With spend flow data available on one platform, finance teams will be able to review each expense report and identify what needs urgent attention. Using intelligent technology will mean that this process gets continuously faster and better as the system continues to learn. Teams will be able to manage budgets proactively, reduce operational interruptions and improve efficiencies of planning activities.
And streamlining processes doesn’t just have to involve technology to find new ways around challenges. Hybrid working is a great example of streamlining work procedures during times of stress and adapting working environments to increase agility and convenience for employees. To support spend management goals, connecting an ecosystem of partners and collaborating with multiple departments to work out cost controls is another great way to build business resilience during this economic downturn.
Choosing the right solution for your business
Not only will managing spend with intelligent technologies help to cut down time spent on admin-heavy tasks, but it will also reduce errors, waste and fraud. It also gives businesses the chance to align their spend management process with long-term goals such as sustainability, agility and resilience.
However, investing in the right technology is easier said than done. It’s important to identify any gaps in your current technology that hinder your business. Does the current technology help to improve agility and efficiency? Does it allow you to easily forecast budget and decide where next to invest? Does the technology drive the business towards personal goals, such as sustainability KPIs?
The right technology will help to close the gap between expenses, invoices and the people who need to get paid. Making sure that you can turn each expense report into an opportunity to save on costs and boost compliance will strengthen the business against the full impact of these turbulent economic times.
