Extracting Real Benefits From Travel Expense Management

Extracting Real Benefits From Travel & Expense Management
For your company to​ truly reap the​ rewards of​ a​ structured corporate travel policy,​ it​ must focus on​ one thing above all else: compliance .​
Unfortunately,​ while the​ explosion in​ convenient Self Booking Tools gives you​ a​ lot more freedom of​ choice,​ it​ also makes compliance a​ great deal more challenging .​
Any technology that supports an​ increase in​ compliance to​ policy has merit; it​ will save your company money and bring back the​ benefits of​ corporate travel .​
Today's diversity of​ choice in​ self booking tools makes compliance through denial of​ access a​ very difficult protocol to​ enforce .​
What you​ really need is​ a​ funnel through which 100% of​ your company's travel activity must pass .​
In the​ corporate world,​ the​ only viable funnel is​ the​ payment mechanism – getting paid is​ the​ ultimate leveler .​
If you​ use a​ corporate credit card as​ the​ payment mechanism,​ supported by an​ expense management solution,​ and suppliers who can report back to​ you​ a​ reasonable level of​ data,​ you​ stand a​ very good chance of​ supporting the​ compliance objective .​
A compliance-friendly Expense Management Solution (EMS)
An expense management solution which processes card transactions (and possesses decent workflow) requires the​ traveler to​ personally justify all deviations from policy to​ their supervisor – on​ a​ transaction by transaction basis .​
Just as​ importantly,​ the​ warehoused individual transactions give the​ corporate travel manager the​ opportunity to​ conduct spend analysis and examine individual and aggregate behaviors .​
You might argue that this is​ after the​ act,​ but it​ still encourages compliance .​
As per all card based procurement systems,​ if​ an​ employee consistently deviates from company policy,​ they may be penalized (e.g .​
card withdrawal,​ official warning,​ employment termination,​ etc.) .​
The threat of​ negative repercussions acts as​ a​ deterrent to​ card misuse,​ thereby increasing the​ level of​ compliance .​
The benefits of​ policy compliance
80% of​ the​ business case benefits of​ corporate travel will come from travel policy compliance .​
This requires:
• Sound policy and procedures;
• a​ comprehensive communication strategy;
• a​ gate through which all activity can be channeled (the card and the​ expense management solution); and
• Tools to​ monitor and measure compliance .​
There will also be some peripheral benefits to​ be gained from an​ expense management solution in​ the​ pre-trip phase:
For instance:
• the​ traveler can use the​ work flow component of​ an​ expense management solution to​ create travel request and approval records rather than using something less structured like emails .​
• Using the​ expense management solution,​ the​ traveler can create a​ commitment record at​ the​ time of​ booking for subsequent matching of​ the​ credit card transaction when it​ comes through .​
• you​ can obtain a​ download of​ trip data from your TMC,​ and travelers can seek to​ match that against trip card transactions,​ thus reducing the​ quantity of​ manual entries required of​ the​ travel coordinator .​
• the​ expense management solution provides travelers with a​ real-time log of​ commitments beyond what might be recorded in​ a​ personal diary .​
How does it​ apply to​ your company?
In looking at​ the​ business case for this exercise,​ you​ do need to​ closely examine a​ number of​ factors to​ determine the​ benefits you​ will actually realize:

• There are no industry-wide standards,​ and the​ market tends to​ work as​ a​ series of​ isolated closed provider loops – your efficiencies will be greatest if​ can conduct your business entirely within one closed loop .​
It is​ up to​ you​ to​ determine if​ you​ can obtain maximum purchasing power in​ this environment .​
• the​ importance you​ place on​ understanding the​ cumulative value of​ travel booked but not yet paid .​
• the​ extent to​ which you​ can source the​ data you​ require from your travelers via a​ TMC data feed and,​ consequently,​ the​ keystroke savings you​ can achieve for those travelers .​
• the​ productivity gains you​ will obtain for your travelers by virtue of​ them setting up trip details in​ your Expense Management Solution (EMS) at​ time of​ booking rather than at​ time of​ arrival of​ the​ card transaction .​
The combination of​ Electronic Travel Management and Expense Management is​ an​ important subset of​ eProcurement,​ and it​ is​ subject to​ the​ same challenges facing all eProcurement initiatives over the​ past 10 years – industry standards,​ supplier participation,​ and a​ seamless marketplace .​
Until these elements are all in​ place,​ greatest advantage will be gained by companies that focus on​ the​ big picture of​ where they can achieve maximum purchasing value with reasonable purchasing productivity – usually based on​ being able to​ perform an​ analysis of​ spend patterns and behavior.
Extracting Real Benefits From Travel Expense Management Extracting Real Benefits From Travel Expense Management Reviewed by Henda Yesti on July 26, 2018 Rating: 5

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