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As finance professionals, the traditional approach to travel expense management has been to ensure compliance and control costs. In today’s global economy, the financial professional’s role has evolved to more of a strategic advisory for organizations. Travel is a major expense for organizations. Finance professionals, as strategic partners have an opportunity to leverage technology to help move the organization forward and address the challenges.
Compliance comes at a cost for organizations, this cost is even greater when organizations have complex structures and stringent travel policies and procedures. Understand that compliance is necessary. My advice for organizations is to scope beyond current compliance standards when selecting a travel expense management technology solution.
"An efficient system for travel expenses should automate reviews and approvals and integrate with the organization’s financial system"
Organizations should take a strategic approach to ensure that the travel solution can evolve with the organization and address potential future compliance requirements. The strategic focus should also include considerations for government-imposed travel compliance beyond the company’s internal compliance standards.
For heavily regulated industries, such as government, implementing technology that captures the necessary information for monitoring can be quite costly and administratively burdensome for employees and the finance department. These costs can be exacerbated when organizations take a reactive approach to compliance. System modifications to capture an “aha moment” can be extremely costly and cripple organizations. Organizations need to understand the cost of compliance.
An efficient system for travel expenses should automate reviews and approvals and integrate with the organization’s financial system. Employees want to be paid timely for travel reimbursement. Manual processes and disparate technology systems lead to protracted processing time for reimbursement.
Further, knowledge is power. Knowing how much the company is spending on travel and the types of expenses provides invaluable information for an organization. Finance teams need visibilty into travel expense data. Not just for compliance monitoring, but to provide management with valuable information for decision-making.
Reporting is a key function for the travel expense management. Yet, organizations need to be clear on exactly what information is needed and how the information will be used by the company. Standard reporting that provides management with information to drive decisions on resource allocation are a “must have” for today’s operating environment. But, no two organizations are the same. The selected solution should provide the opportunity to create ad-hoc reporting, that better aligns with the organization’s structure for travel expenses.
Beyond that, an agile travel expense management solution can provide the organization with invaluable information about employees’ “preferences” for some of the most common travel costs such as hotels, rental cars and food. Knowing the preferred brands of your employees can be powerful information to establish agreements for employee discounts.
This may help the organization reduce costs but also provides an opportunity to enhance the travel experience for employees, which are an organization’s most valuable asset.