An easy-to-use interface and a broad range of traveler-friendly features are critical elements for expense management software. So is the ability for administrators to configure the solution so that it fits perfectly with an organization’s existing policies and approval workflows.
As essential as these factors are in the selection of an expense management solution, any front-end benefits are meaningless if the solution doesn’t easily integrate into your tech stack, introduces security vulnerabilities for your network and your users’ data, or simply isn’t available when you need it to be.
Here are five key issues that CIOs should be aware of when reviewing expense management solutions:
How easily does it integrate into existing applications?
Expense management is just one part of a significantly larger technology ecosystem for most organizations, and in order to achieve a seamless process for purchasing, general ledger allocation and reimbursement/billing, it needs to integrate effectively into these solutions.
On the travel side, corporate travel management companies and online booking tools provide daily feeds of booking data which need to be integrated into the travelers’ expenses. In addition to the TMC data feed, many companies have corporate card providers, whose transactions need to be imported into the expense solution, and then matched up with receipt data submitted by the end-users.
An expense solution should be easy to integrate into whichever travel booking solution the organization deploys, either with direct feeds, or through third-party connectors. There should also be no walled-garden restrictions about requiring travel booking and expense solutions from the same vendor to be deployed, allowing CIOs and line-of-business heads to choose whichever best-of-breed solutions fit their specific requirements.
For credit cards integrations, organizations should look for solutions that can provide real-time spend notifications that can be matched with purchase receipt images in near-real-time, so users don’t need to worry about reconciling receipts with transaction data at a later date. In addition, solutions that can directly integrate card providers’ statements can significantly speed up the reconciliation and payment process for corporate cards.
On the finance side, the expense solution must also integrate effectively and seamlessly into whichever ERP, billing and HR solution(s) that the organization uses, in order to effectively transmit data to the GL for accounting reconciliation, client billing, and finally reimbursement.
Although many larger ERP vendors offer their own pared down expense solutions and would of course prefer organizations to adopt their whole suite of products, they operate an open ecosystem. This means that – despite what the ERP vendor’s expense sales team may claim – best-of-breed solutions can integrate either directly via APIs, or via the ERP’s or a third-party connector.
CIOs and CFOs in the Sandbox: 5Qs to Explore
Here are five questions for CIOs and CFOs to explore to contain costs, improve traveler experiences and more efficiently track expenses in real time.
1. Is the organization’s current expense solution unnecessarily using IT resources or outdated technology?
The old adage “if it’s not broken, don’t fix it” holds companies back. An IDC research report found that roughly 80% of today’s AP managers’ time is spent on lower-level financial tasks, such as invoice matching, purchase requisition, and vendor management – all tasks that have the potential to be automated.
2. Is there a backlog of enhancement requests or report creation requests from users that cannot be addressed in a reasonable amount of time?
Finance isn’t seen as a sexy place to innovate by ERP providers. However, not investing in finance functionality is a mistake with long-term consequences. Companies that turn a blind eye and continue this path aren’t benefiting from the innovations being developed – from major cost savings across more areas of the business to growth opportunities for rising finance team talent.
3. Has the vendor of the technology announced an “end-of-life” strategy for the product? Or is the product in “maintenance only” mode?
Prepare for a technology’s “end of life” by transitioning to longer term solutions that create a more positive end-user experience, integrate travel data to give a company an end-to-end view of spend, or access to near, real-time data with insightful, visual reports.
4. Is the organization favoring solutions that increase the end-user experience?
According to a Forrester research report, “In the US, travel and expense software is considered the most important tool for enabling good employee experience.” The easier these processes are for employees, the more likely they will follow organizational protocols, budgets, and safety measures.
5. Is the organization capturing all employee spend data in one place?
With multiple platforms capturing and aggregating all employee spend, companies risk not being compliant with government or industry regulations and increase their chances of fraud. It takes, on average, 14 months to detect a fraud scheme, according to an ACFE report. The big takeaway is: simplify. When finance has control and visibility into the details of where and how company dollars are spent, it becomes easier to detect fraud quickly.
Financial Transformation: It’s Real-Time All the Way!
The role of money is evolving. Whether it’s touchless or automated payments, blockchain or a shiny new cryptocurrency wallet, change is here. One prediction, however, by Deloitte is on point: Finance is going real-time. There will be less reporting and more real-time visualization. Here, technology offers solutions.
SAP Concur’s findings back this up: business travelers want to see their company invest in adding or updating apps with real-time travel updates and booking (46%), tools for quicker expense reimbursement (43%), and tools for navigating the latest travel safety requirements (41%). A travel management system (40%) and an integrated system for travel and expense reporting (39%) round out their top five.
Finance managers themselves see change as inevitable. The study revealed that 100% said that their role has changed — and has become more challenging — since the start of the pandemic.
Reasons include taking on additional work caused by staffing shortages (59%), additional auditing and paperwork requirements (45%), and new or added involvement in internal communications (45%). On average, they are spending six hours each week on these tasks. Tech solutions, like embedded machine learning and human verification, modernize finance.
CFO-CIO Team Requires Solving for X Together
Based on SAP Concur’s research, 66% of senior executives believe a strong partnership between IT and finance leaders enables the organization to remain agile in the face of unforeseen challenges. This I know: whether in my role as a parent, business advisor or board member, one of the best ways to get people pulling in the same direction is through a united pursuit of something bigger than themselves.
Start with these five questions – and watch amazing things unfold. As CIOs and CFOs tackle big issues together, like balancing the benefits of business travel against a “do more with less” business environment, they cover more ground and help everyone, including the travelers themselves, arrive at a better destination.