Managing travel and expenses (T&E) poses significant challenges across company sizes. A primary concern for companies revolves around the laborious tasks of compiling, processing, and reconciling expenses. Travel and associated costs constitute a substantial portion of corporate budgets. Manual management of T&E increases the risk of human error and potential expense fraud. However, automating these processes can help mitigate the aforementioned issues. Below, we have covered the challenges of travel and expense management as well as pertinent solutions that address the same. Read along or hop into sections that interest you the most.
Lack of Productivity
Companies using manual travel and expense management methods often find the process cumbersome and time-consuming. Traditional travel and expense management involved dealing with numerous paper receipts, sending multiple emails, and creating various expense spreadsheets. While this may work for small companies, it becomes inefficient as the company grows, creating bottlenecks. For instance, manually approving a travel expense report with errors can lead to laborious back-and-forth emails, taking up employees’ time that could be better spent on other important tasks.
What Works
Implementing a corporate travel and expense management software can streamline and automate repetitive tasks such as expense validation, approvals, and data transfer to the accounting system. This enables the finance team to focus on more critical tasks, enhancing productivity and saving resources in the long run.
Unavailability of Advanced Travel Analytics
Business travel analytics are crucial for monitoring employee travel spending and making key decisions like forecasting and budgeting. Research report by IBM indicates that nearly 58% of midsize and large organizations still use spreadsheets to manage expense data, missing out on essential travel KPIs that can improve financial decisions. Advanced analytics provide a clear picture of employees’ spending patterns, enabling more informed, strategic decisions regarding travel policies and budgets. They also help identify cost-saving opportunities and implement cost-cutting measures.
What Works
Consider the benefits of automated T&E management with advanced business travel analytics. The analytics dashboard consolidates travel-related expenses, offering insights into the company’s cash flow and enabling effective fund management. Detailed reports can be generated by time period, department, and expense type, allowing for strategic identification of cost-saving opportunities. This streamlined approach not only enhances financial transparency but also optimizes operational efficiency, empowering businesses to make informed decisions and achieve sustainable growth.
Dearth of Integrations
Using traditional travel and expense management methods makes integrating various systems challenging and costly. This lack of integration can also hinder getting a comprehensive understanding of your business travel process. For smooth business operations, it is essential to integrate your travel management process with accounting solutions, CRM software, HR software, communication tools, and other applications. This ensures automatic data synchronization between departments, eliminating silos and minimizing data inconsistencies.
What Works
An ideal T&E management software like Costen, can facilitate data synchronization and integration. This enhances the efficiency of the business travel process, as data does not need to be manually retrieved from other departments. For example, travel managers do not need to manually fetch employee data; the data is automatically populated in the travel management software when employee details are added.
Interestingly, integration of data and documents is not only crucial for T&E management, but also for mileage reimbursement. It ensures accuracy and consistency across all platforms, by minimizing errors from manual entry and guaranteeing precise mileage reporting. This helps to maintain compliance with company policies and government regulations by creating a clear audit trail.
Inefficient Receipt Management System
Managing, storing, and tracking paper receipts manually presents numerous challenges. Paper receipts are susceptible to loss, damage, or tearing, leading to potential data loss and compliance issues. Moreover, retaining these receipts for tax purposes, often mandated for 3-7 years, demands significant storage space and incurs considerable costs. Each receipt necessitates meticulous verification by an accountant to ensure adherence to the company’s travel policies, adding to administrative burdens and time-consuming processes.
What Works
Automation in such cases, can work wonders. An online receipt management system can optimize storage and management. This system stores receipts in the cloud, eliminating the need for physical storage space and making it easy to locate specific receipts when needed. This streamlines the expense approval workflow by centralizing management, enabling the finance team to verify expense claims more quickly and making the process of filing expense reports more efficient.
Increased Chances of Errors and Inaccuracies
Manual travel and expense management is often plagued by human error due to its reliance on manual work. Common issues include duplicate or incomplete expense reports, data entry mistakes, damaged receipts with unclear printing, and manual verification against company policies.
What Works
Costen, an advanced automated expense management software solution, significantly reduces costs by minimizing inaccuracies in expense tracking. Employees conveniently upload receipts, which are swiftly scanned and undergo automated data extraction. This seamless process facilitates the generation of detailed expense reports at the click of a button, drastically cutting down on manual effort and speeding up workflow processes. By eliminating human error and ensuring precision in financial data handling, Costen enhances overall operational efficiency and supports better financial decision-making within organizations.
Takeaway
Automating travel and expense management is a smart move. By shifting from manual to automated processes, companies can enhance accuracy, save valuable time, and significantly reduce costs. It brings real-time updates, ensures compliance, and provides detailed insights into spending patterns. So, embrace automation in travel and expense management to streamline operations, boost productivity, and stay ahead in today’s curve.
