Control Company Costs
Are Your Spending Processes, Metrics Up to the Times?
The past few years, without a doubt, disrupted spending patterns at your company and across the economy.
As spending changed, your processes to manage travel, other expenses, invoices, and other key business elements likely changed with the spending shifts. Because they had to.
Amid that evolution, the moments of clarity and confidence in each spending decision may have become moments of uncertainty for the finance team and others. It’s a fair question to ask if some measures you once counted upon still measure up.
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Do you know all your spending numbers and how much certain categories cost to oversee? It’s difficult to control what you can’t see.
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Have you adjusted your key performance indicators – adding some KPIs, jettisoning others – to track and reveal the challenges and opportunities of the times?
Let’s look at some key areas, metrics to consider, and ways adopting or extending automation solutions could help your business and team.
Using corporate cards vs. cash
Paying expenses with cash can reduce control and increase risk. Encouraging team members to use corporate cards instead of cash can improve spending visibility and the amount your company receives in card rebates. Multiply eligible expenses by your card’s rebate rate – up to 2% – and you’ll get a good idea of the possible savings. Automated expense and invoice solutions, and their dashboards can help you stay on top of both cards and cash.
KPIs to consider: Measure cash vs. card use in such categories as airfare and hotels; track late fees for corporate cards and invoices.
Managing receipts
Manual receipts and processes consume time and resources. Give employees a solution that lets them take a picture of receipts, as it not only truncates the paper trail but also can send the gathered information directly to reports. Automation and integration also can allow you to collect receipts electronically from suppliers and corporate cards, increasing the timeliness and accuracy of your spending picture. If you want to see the time lost to manual transactions – and the potential of automation – just divide the number of manual transactions by the minutes in an hour. The tally may surprise you. Companies that use SAP® Concur® solutions average time savings of 36% in expense report handling and processing.1
KPIs to consider: Track the number of receipts requiring follow-up; measure the number of required receipts attached to reports, as well as unnecessary ones included.
Measuring mileage
You already probably know that, for travelers and finance team alike, tracking mileage is time- consuming and hard to get right. Did you know that manual tracking can result in as much as 15% more miles than were actually traveled? A GPS-enabled mobile app that automatically tracks and submits trips can improve accuracy and reduce overpayments.
KPI to consider: Identify high-travel employees to check mileage accuracy and see if they’re using the right tools and modes of travel.
Auditing accuracy
Auditing expense reports can be a big drain on finance team time, hours and even days that could be better spent on work that adds greater value. Solutions that use artificial intelligence, bolstered by the help of outside experts, can analyze those reports, flag exceptions, and reduce the burden on your team’s productivity.
KPI to consider: Compare percentage of reports audited by people vs. those by automation.
Cleaning up, gaining accuracy
Gaining the ability to measure and tally spending is an opportunity to clean up and hone your processes and solutions. You can fine-tune or remove spending categories, clarifying and simplifying the expense process and employee experience. Or you can confirm that the data received is accurate and comprehensive. You can better see how spending matches forecasts and budgets or uncover issues for correction.
KPIs to consider: Gauge the difference between what’s budgeted and what’s spent; scrutinize the number of expense refunds or updates to employees; identify spending categories to add or remove.
The examples are just starters when assessing the ways automation solutions and better processes can improve accuracy and efficiency – and how you measure progress – at your company. They are steps small and large, but they all add up. When you can see all your spending and obtain both answers and insights, those moments of doubt can become moments of clarity and opportunity.
Learn more
To find out more about adjusting your KPIs, calculating spend management costs and learning how SAP® Concur® solutions can help, read these guides:
