Employee travel and expense, when managed efficiently, has the potential to save the organization hundreds of thousands, even millions of dollars. However, most organizations still use outdated traditional practices when managing travel bookings, expense reporting, or expense reimbursement which makes the process cost and labor intensive, error-prone, and cumbersome.
In this post, we’ll look at a few best practices that organizations can implement to optimize this process and make it lean.
Policy – Definition and enforcement
The importance of having a clear and well-defined travel and expense policy cannot be overstated enough. A travel and expense policy covers the entire gamut of activities that come under travel and expense management – from listing out legitimate and illegitimate business expenses to reporting procedures. It tells the employees what kind of reports they have to generate and to whom they should report and with what frequency. It also identifies the approvers and defines the approval flow. It imposes the limits and thresholds as well as deadlines.
Without a standard organization-wide policy, employees will take it upon themselves to come up with their own report formats, deadlines, and limits, giving rise to chaos and process inefficiencies.
Also, effective communication and strict enforcement of your policy are just as important. After all, there is not much point in having a policy if no one knows about it or interested in following it.
How many of us would be happy waiting months to receive payments that were rightfully ours? Why should employees be happy to wait, especially when they pay their expenses out of their own pocket and are reimbursed later?
Organizations should seek to complete their approvals and reimbursements as soon as possible so that employees do not feel the pinch when they spend their own money.
This is by far the best practice to follow. By automating parts of it, organizations can minimize, or even eliminate, gaps and inefficiencies in the T&E management process. Many of the manual tasks like approvals, reimbursements, receipt management, currency conversion, receipt matching and validation, etc… can be automated using expense reimbursement software to save employee man hours. This software can also help you generate new value from existing business processes where none existed before.
All of the above could be managed using online expense report software which helps organizations simplify, automate, and streamline their T&E management process.