As small-to-medium businesses (SMBs) grow, so will employee numbers along with spending on essentials from travel, supplies, and marketing services to computers and department-focused cloud software. As a result, employees will have more say in spending decisions, which gives them more autonomy and control but also creates more administrative work in the form of expense reports, which managers need to review and approve before the finance department can review, process, and pay or reimburse these expenses. An automated expense management system can help reduce the manual burden associated with this increased spending, according to SAP Concur.
Fabian Calle, General Manager, Small to Medium Business, ANZ, SAP Concur, said, “If a business is still using manual processes to create and process expense reports, this will cost the business more employee work time and money, as these manual processes are inherently inefficient and laborious.
“With a manual process, employees are expected to collect receipts and attach them to paper-based expense forms, make copies, fill out spreadsheets and Word templates, manually match credit card charges and receipts, walk around to get manager approvals, and then hand off a messy package for processing by finance. It can take hours and often gets done after hours, leading to employee resentment or delays in processing expenses.”
Manual processes also create more risk of non-compliance. Often, managers don’t have the time to audit expense reports properly, where small mistakes such as incomplete documentation can give way to larger mistakes, and even fraud. At the same time, manual processes make it harder for the finance department to track and monitor what employees are buying and when payments are due, which can lead to cash flow problems and out-of-control spending.
By deploying cloud software applications that automate expense management, SMBs can tackle the growing expense chaos. Studies show that automated travel and expense users are saving organisations an average of US$30,000 annually, or about US$600 per year for each employee using the application. It has also been highlighted that businesses saved an average of US$20 per expense report simply by capturing data digitally, eliminating manual, cumbersome tasks, and streamlining approvals.[1]
SAP Concur has identified three core expense capabilities that an expense management system should have:
1. Automation
Automating the expense process will save businesses time, ensure financial visibility, reduce non-compliance risk, drive operational efficiencies, and increase data accuracy and timeliness for reports. Completing these tasks manually is labour intensive and takes away time from employees who could be doing more productive tasks.
For example, to streamline and automate compliance, the chosen solution should make policy instantly available to everyone across their desktop and mobile devices. This makes it easier for employees to understand and follow the rules, and easier for financial decision-makers to enforce them consistently.
2. Visibility
Visibility is important when running a business, and especially in tracking spending. Without real-time visibility, business decision-making can be impaired. Visibility gives businesses real-time insights to employee-initiated spending, lets them track processes and spend, and helps them identify revenue and saving opportunities.
Consolidation
Reporting manually can mean looking for pieces of information for one report in six different places, which takes up valuable productive time in a growing business. An automated expense management system can consolidate all data into one place (and sometimes even write the reports), so that employees do not have to look for information manually. This lets businesses see an overall view of expenses and helps organisations make forward-looking, real-time strategic decisions.
Fabian Calle said, “Businesses should look for a solution that truly automates the process, providing time savings as well as complete, accurate visibility into every dollar of business spending in real time. The solution should also let businesses monitor data trends so that they can anticipate and manage spending before it happens.”
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[1] Joseph Bertran, “Elevate Business Performance and Better Manage Spend with Automation,” AMI-Partners study sponsored by SAP, February 2018.
