Each day, new technology and telecommunication options shrink and flatten our world while simultaneously expanding and globalizing our economy. Companies are breaking down borders, expanding outward to explore new business opportunities, and forming new partnerships. As a result of these changes and the associated impact on travel and collaboration, organizations are re-thinking to transform their manual approach of travel and expense management to automated approach.
Travel and expense (TE) management is a vital component of a finance department and comprises a large portion of a company’s annual budget. There are various complexities associated with manual management of travel and expense management.
The four main problems with manual travel and expense management are:
Significantly Higher Error Rates
Compared to automated processes, companies reported a much greater incidence of error, not only in recording data but in the processing of expense reports using manual methods. This includes misuse of Excel, improper formatting of expenses and improperly recorded expenses.
Not Easily Reviewable
A manual expense system makes it impossible to monitor expenses before they are recorded. This also makes it quite hard to impose policies and ensure they are followed accurately.
Reimbursement Costs and Time
Processing expense reports takes longer, reimbursement takes longer and the cost of repayment is greater than with an automated system due to the manual processes shipping and processing.
Paper Based Expense Reporting
Manual expense management is traditionally paper based, requiring managers to print and annotate their expense reports with receipts and then ship those reports. Additionally, payments are paper based, slowing reimbursement time and increasing costs.
So best-in-class enterprises are focusing on managing their T&E policies and processes by effectively blending technology and strategy. Travelling expenditures are rising due to increased globalization and need for worldwide travel, as well as inflationary pressures. Rising costs are the number-one factor influencing companies to automate their travel and expense management which fetch lot of benefits like:
- Better ability to enforce effective travel policies
- Lower processing cost
- Improved visibility over spend
- Improved employee satisfaction
- Quicker reimbursement of employee expenses
- Improved ability to detect and prevent fraud
- Ability to negotiate volume discounts with vendors
- Reduction in late payment penalties and interest
- Integrated with workflow, cost estimate and payroll features
Travel and expense management is becoming increasingly dependent on mobile functionalities, and solution designers are making mobile features one of their top priorities in development. One of the most valuable assets of mobility Is a real-time dynamic—traveling employees can submit their expense reports from anywhere, at any time, and approvers can see the information clearly, accurately, and immediately. In many cases, this technology enables expense approval in just minutes.