According to a recent survey conducted by Paystream Advisors corporate travel spend is rapidly on the rise with biggest challenges to control these costs resulting from of manual T&E processes and an inability to enforce company travel policies. As T&E spend increases now is the perfect time to learn how other companies have cut their travel and expense processing costs by more than 50% through IT automation.
The survey results include responses from over 300 professionals from a variety of finance and accounting positions, spanning a number of industries and company sizes. The research shows the average cost to process an expense report varies depending on the level of automation that a company has implemented. On average a company spends approximately $21.41 to process an expense report if their process is entirely manual. This was more than twice the processing costs accrued by companies that are fully automated. Organizations that have some automation in place have been successful at driving down the processing costs to $15.06 per transaction, but companies that are fully automated and using an integrated system have dropped their per transaction cost to only $8.50.
So what are the similar challenges that companies are experiencing in controlling costs associated with business travel? Common inefficiencies among companies today include:
- Verifying travel policies for booking
- Sorting through and submitting receipts from multiple trips
- Enforcing corporate travel policies
- Cash management issues due to delays in reimbursement
- Limited visibility into travel spend needed to make informed cost control decisions
Companies that are shying away from T&E automation because they think their current processes work or that there will not be a ROI simply need to do the math on the cost to process an expense report. When you multiply this transaction cost across an entire organization for one year, the cost becomes astronomical. While the benefits of automating the expense management processes though sofware are numerous, 4 benefits stood out in this survey:
- Lower processing costs – 52 percent
- Better ability to enforce travel policies – 51 percent
- Improved visibility over spend – 50 percent
- Quicker reimbursement for employee expenses – 50 percent
The great news for SAP customers is the SAP Travel OnDemand, solution stands out in all of these areas. Specifically, it lowers the admin burden of processing expenses by eliminating paper-based, offline processes through an easy-to-use solution designed for mobility. Furthermore, the solution automates the entire lifecycle of a trip from planning, approval and online booking to expense submission and reimbursement all of which cuts processing costs.
Also, SAP Travel OnDemand enforces employees to stay within corporate travel policies by embedding company-wide expense categories and limits, approved travel suppliers and booking practices with real-time guidance and controls on travel rules when planning trips.
Additionally, the solution’s reporting and analytics of travel expenses across various dimensions, including business units and geographies, provides companies the visibility needed negotiate better terms with external travel suppliers.
Finally, by enabling travelers to enter and submit receipts and expense reports anytime, anywhere, for faster approval combined with integration to SAP ERP to accelerate accounting and reimbursements improves overall cash management.
If you would like to dive deeper into the statistics on how companies are saving money in travel and expense management through IT automation you can download the full independent Paystream Advisors research report here. After reading this independent survey it will be hard to deny there is a significant business case for investing in software to automate corporate travel and expense management processes!