Making expense claims and submitting expense reports are often seen as a massive drain on time, time that employees could otherwise be spending on productive and revenue-generating work. In particular, for billable employees – those people whose work can be charged back to a client – every hour spent organising expenses is wasted revenue for the business. Expenses then get left to pile up until they’re impossible to ignore. It’s a big problem when employees dread the process and procrastinate on filing at all – often referred to as “expenses fatigue” – and it creates a significant headache for finance teams.
Tim Hughes, author and industry expert on social selling in the digital age comments: “Expenses can be a massive area of “leakage” for any business but particularly those in the commercial functions such as salespeople. I could never understand the person that would wait until the end of the year and then submit a massive expenses bill.”
Poor expenses management can also have a profound effect on your employees’ financial wellness, he argues: “You are giving your employer a massive interest-free loan. Sorry, but expenses are another area where, as an employee you need discipline – regular and often expense claims are the order of the day.”
“Expense fatigue” in today’s workplace
A major cause to all of this is that technology to support the process of expense reporting is likely archaic and extremely difficult to use. Whilst some people still have to manage expenses manually with paper receipts and spreadsheets, others aren’t able to do it via their mobile devices, and many more get frustrated with inaccurate receipt scanning strewn with errors that are difficult to override.
Whilst many companies focus on delivering a great traveller experience, there’s surprisingly little consideration to how poor expenses management has an adverse effect on employee morale.
Why expenses are costing you more than you think
Poor expense procedures and systems are not only rife with frustration and time drains but they also enable the possibility of fraud. Business travel expense fraud is estimated to cost almost $2 billion dollars annually – and that’s only in the US. According to the same report, employees are two times as likely to commit fraud if they’re submitting expenses manually compared to using automated expense management systems.
As a result, business leaders are starting to demand better expenses technology to increase productivity, control costs and deliver better workplace experiences to retain talent. The good news is that expenses management technology is evolving and can provide real benefits for businesses that require employees to travel, either domestically or internationally.
So whether considering the drain on accounting, the employees claiming expenses, or the opportunity and cost of potential fraud, businesses need an automated tool to manage the burden of tracking their corporate travel expenses. And beyond simply reducing the time burden and room for error, expenses management automation can reduce “expenses fatigue”. It provides greater and more holistic insight into how the company manages travel expenses, leading to improved decision-making all round.
How automated is automated?
When we think of manual expense reporting we think of paper trails and manual signatures. But “manual” also applies to systems where employees have to batch enter expense claims against a particular “subject” or date, and input each level of detail themselves.
Truly automated expense management allows employees to submit expenses anytime, anywhere. Receipts can be scanned and read by OCR (optical character recognition) technology to pre-populate dates, amounts and vendors. There’s no need to wait until the end of a month or quarter to gather expenses altogether.
Employees simply photograph receipts and submit as they spend – with AI-powered technology automatically allocating costs against a business purpose, such as a sales opportunity, marketing event or customer meeting. And effective analytics allows finance and leadership teams to roll up all those line items into ROI reports on expense spend vs revenue.
It’s time to ditch manual expenses management
With all of the above, it’s hard to think of a single justification for persevering with manual expenses management when the upsides of digital expenses management and reporting are so substantial. Making the move will save your business more than just money: productivity, financial visibility and employee satisfaction will increase, while the business risks of inaccuracy and non-compliance are minimised.
So should you choose to make the move, take a good look at the app and platform to make sure they’re easy and intuitive for employees and managers to use. You want any new expenses management system to be adopted readily and to eliminate any “expense fatigue” immediately.
And don’t forget to make sure your chosen system’s reporting capability gives you the actionable insight you need. If your expenses data integrates with your CRM’s customer and revenue data, you’ll be able to generate even fuller financial and operational analysis to support your strategic decision-making.