Whether you’re a salesperson or a consultant, keeping track of travel and entertainment expenses can often be a hassle. What’s worse, it feels like busy work — collecting these petty receipts, filling out forms, getting approvals — and you’d rather be doing your real job.
In reality, these expenses are far from trivial. A recent study shows that, on average, travel and entertainment expenses (T&E) comprise 8-12 percent of an organization’s total budget, according to an article on the CFO Magazine website. If your company isn’t actively managing these expenses, that means you probably cannot accurately forecast a large percentage of your annual spending.
According to Aberdeen Group analyst Christopher Dwyer, “anything that smaller businesses can do to get their arms around T&E is huge. Organizations are seeing dollars going out the door and asking if they can drive down costs.” Companies who use automated expense policies can lower their processing costs, better manage business travel spending, and expect workers to abide by the policies — which offers a significant competitive advantage.
Businesses can take advantage of several new web-based services for T&E management, such as Chrome River. Many of these tools are cloud-based. The benefits of using such an automated system include lower processing costs associated with expense reports. They free employees from paperwork, and finance departments gain higher quality data, offering greater visibility into the company’s T&E spending.
Creating an automated, end-to-end expense policy sets the stage for potential savings and risk avoidance, while also improving employee morale as rules now become consistent and evenly applied. But since no two companies are exactly alike, it’s important for the expense policy to reflect the unique requirements and culture of the organization.
What do you think? Would your organization be more efficient if your employees complied with company expense policies? Would an automated system help reduce expenses?
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- 4 Critical Things to Look for in Your Next Expense Management System
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Wow! This Chrome River is great. Word has spread [in our firm] and people that were not invited to be in the pilot group rollout have asked to be included!