A new way to think about travel and expense management

As the world eases back to normal, employees are returning to the office in droves, and business trips are on the upswing. Globally, 84% of senior leaders believe that their travel spending would significantly increase in 2023. Corporate travel is even projected to reach full recovery and soar to US$1.47 trillion globally by 2026, says the Global Business Travel Association (GBTA).

Even before the pandemic, corporate travel and expense (T&E) was already the second-highest company expense after payroll, accounting for almost 13.5% of annual spending on average, according to a study by Mastercard.

To better manage and control employee spending, companies must find new ways to manage T&E with an increasingly mobile hybrid workforce. Enterprise applications can provide finance leaders with a single source of truth regarding T&E, giving data-driven insights for better executive visibility and control over business expenses whenever and wherever it happens.

Update your T&E policy for a hybrid workforce

Setting clear guidelines and communicating these are important first steps to take to better managing T&E. A formal T&E policy lets your employees know what they can and cannot file as reimbursable expenses, and gives management real-time visibility into budgets and expenses.

Creating a comprehensive and effective T&E policy can be time-consuming. However, when you consider that almost 20% of expenses filed are outside of company T&E policy, then the time and effort put into crafting a solid T&E policy will pay off. Further, research from Mastercard reveals that 29% of annual corporate T&E spend is not even compliant with corporate policies.     

If you already have a T&E policy in place, it’s high time to update it to account for an increasingly hybrid workforce. As it stands, 65% of employees say that traditional T&E policies are unfair and limit what they can do as they perform their duties.

Current T&E policies may also need to be reviewed and updated in light of changes brought about by the COVID-19 pandemic. For starters, it would be good to ask these questions:

• Is your T&E policy flexible enough to adapt to changing health restrictions and government requirements?
• Does it consider expenses around employee health, safety, and wellness?
• Does it also factor in sustainability?  

A good T&E policy must manage and control corporate T&E expenses like air and ground transportation, accommodations, and meal expenses, all while maintaining employee satisfaction. The key is to reduce friction between your T&E policy, employees, and their overall experience on the field. 

To help you get started, SAP Concur created this expense policy template you can use and customise based on your needs. This template helps you build an expense policy based on global best practices, explaining the different categories your T&E policy must consider for improved expense management and financial reporting.

Make it easy for employees to comply and report expenses

Policies are only as good as your ability to enforce them. After finalising your T&E policy, hold a training session for employees to explain its goals, purpose, and benefits. Spreading awareness about your T&E policy and the importance of compliance can help your finance leaders enforce its rules with confidence.

Remember: not every case of fraud is malicious or intentional. Sometimes, it all boils down to a lack of knowledge or understanding of existing T&E policies. While often unintentional and a result of human error, reimbursable expense report fraud still has costly implications for the organisation—a typical company can lose at least 5% of its annual revenue to fraud.   

High compliance with the T&E policy means your employees stay within budget, file the correct reimbursable expenses, and then report their expenses on time, thereby improving overall financial reporting.

However, complex and painful processes remain a major deterrent to compliance, especially around expense reporting. In the same Mastercard study, it was revealed that manual processes still dominate, with paper receipts mailed to accounting departments and employee expenses reimbursed through cheque payments.  

Make T&E policy compliance easier for employees by simplifying your processes through improved policies and automated solutions. With the right combination of automated tools, expense management strategies, and simplified processes, organisations can avoid costly mistakes, make life easier for their finance leaders, and stop fraud in its tracks. 

Automated solutions, such as Concur Travel, allow employees to book travel on their own, at the best rates, and within your company’s spending policies, all while travel managers retain visibility and control over expenses.

Costs can also be better managed and controlled by ensuring all spend requests are approved prior through Concur Request. These solutions often come with an extensive network of travel suppliers, giving your employees various travel options under one online booking tool.

Other automated solutions, such as Concur Expense, can make expense reporting simple, fast, and accurate for your employees wherever they may be. Previously, filing expense reports entailed manually encoding details on Excel spreadsheets, emailing the accounting department, then waiting patiently for your reimbursements to come in.

Now, expense reports can be automatically generated, with expenses categorised based on receipt images. Using Optical Character Recognition (OCR) technology, ExpenseIt can automatically “read” receipts down to the line item and create categorised expense reports for you.

Tap into enterprise applications for enhanced executive visibility and control

Employees are the greatest asset for every organisation, and typically the most expensive to replace. Ensuring job efficiency and satisfaction through access to the most suitable enterprise applications at the right time can positively impact your employees’ experience—keeping them happy, productive, and focused on value-added responsibilities.

However, employee satisfaction must not come at the cost of the company’s bottom line. Aside from promoting reporting and compliance, enterprise applications provide a seamless flow of organisational data to bring greater executive visibility and control over your business expenses.

To better cope with an increasingly mobile workforce, choose a total spend management solution that works well with web-based apps and mobile devices. This way, finance managers can review and approve expense claims from their mobile devices, wherever they may be. 

Using Concur Request’s mobile app, finance managers can quickly review trip details and expected expenses, and then authorise or reject requests for cash advances, all in one platform. Concur Travel, on the other hand, lets travel managers track employees on the road to meet their duty of care responsibilities, all while helping employees make cost-effective and sustainable choices while traveling.  

Enterprise applications must be optimised enough to provide a single source of truth regarding T&E, giving finance leaders data-driven insights into their business expenses in real time.

The changing nature of corporate T&E 

As the world of work continues to evolve, the nature of corporate T&E will also change. You need a total spend management solution that grows with you, one that helps you develop a solid T&E policy and promote compliance among your employees.

At SAP Concur, we help you leverage enterprise applications that work for you and your employees. Our total spend management solutions give global companies a single source of truth to gain greater executive visibility and control over corporate T&E. Get in touch with us today to learn more.