Travel and entertainment expenses are difficult to manage. T & E spending is the key expense to measure and control. But, most organizations fail to achieve this and the reasons for this are many.
The following are some reasons why businesses are holding back to control employee expenses:
Most SMEs are Run by Manual Processes
Around 54% of small businesses are using manual methods for expense management. Most businesses maintain spreadsheets and use scanned receipts while 24% of them email receipts to AP department. Such methods are of huge burden on employees.
The difficulty of paper-based processes is the lack of visibility and control into employee spending and manual entry. The inability to enforce corporate travel policies is the next challenge. Finance departments have to chase employees for the inaccurate data and approvals, and they don’t find time to analyze spending, fraud and opportunities for vendor negotiations.
Corporate Travel Remains Unmanaged
Usually employees find itineraries online and book travel and send it for managers approval. Around 39% of companies use travel booking portals to book corporate travel. Such processes would result in maverick spending, with policy control left to employees and approvers. Compliance with policies is very hard to achieve and would result in out-of-policy spending.
Better Communication & Automation is What Employees Need
Effective communication, automation and minimal manual activity is what employees look for. Automation would make it easy for employees to comply with corporate travel policies as they can be incorporated with the business processes. Despite the lack of visibility and sheer volume of paper, the finance departments and CFOs will question the ROI of automated TEM.
Cloud-based travel and expense management solutions bring greater ROI to businesses. This helps your teams break out the drudgery and gain insight and control into who is spending what, when and where.