By Kyle Ferguson, CEO, Fraedom
The finance department in every business is always busy. There are invoices to be paid, payments to be chased, reports to be created, and so freeing up time is seen as somewhat impossible. The finance team is facing a constant battle between balancing these jobs, and focussing on what’s really important to business success – increased growth and profit.
Likewise, it can be challenging to oversee and accurately report on the purchases and expenses that are taking place at any one time, to ensure this all tallies up, and is conducive to growth. A study by Paystream and Fraedom, found that 63 percent of SMEs, and 38 percent of average sized corporations, still use manual processes to track their business spend. This is surprising in the so-called digital age, as having a manual process is much more likely to lead to slower and less accurate reporting and reduced compliance.
In order to overcome this, businesses must embrace new technologies that positively disrupt and transform our working lives. As technology continues to develop and change the way we work, organisations should make use of emerging technology to help improve accuracy, efficiency and productivity throughout.
Improve control
If you can’t see everything your business is spending then you can’t possibly control it effectively. Business are still using old, manual processes and expense stories and scandals continue to make the headlines, indicating that companies still need to make progress in this area.
Using technology to capture all your spend in one place improves visibility and control, whilst giving a more accurate view of how much is being spent, by who, where, when, and for what. Giving finance complete transparency allows them to spot issues, identify areas of improvements, adapt policies and make strategic business decisions about the company’s costs. Some employees abuse their expenses deliberately, others simply aren’t aware of the process, and often, without visibility of the right data, finance just aren’t aware of improvements they could be making.
Corporate spend policies vary from business to business, across department and within teams and you need the flexibility to accommodate that, without confusing users about different policies for different spend types. To improve compliance it’s crucial that spend policies are shared with employees, but it’s even better if businesses can automate their policies and approvals so employees don’t even need to worry about the process because it’s done automatically.
The finance department need to be on top of payments going in and out of the company as well as tracking and analysing data to spot unnecessary spend and make improvements. Only with complete transparency can this happen.
Save money
Many companies are looking to do more with less and obvious cost cutting has probably been done already. But there are many more areas where savings can be made – sometimes by improving a process but also from seeing everything you’re spending.
Using an automated expense management system rather than a manual process reduces the processing cost by around 75%*, freeing up staff as well as reducing costs. Companies can scrutinise business costs and see what’s really necessary, identify areas where volume discounts can be negotiated, implement the best policies and improve forecasting and budgeting of future costs.
Free up staff
Doing expenses should not be difficult. We all lead busy lives, in and out of the office, so managing what we spend needs to be quick and easy. Disruptive developments in consumer technology such as contactless and cardless payments have changed the way we pay for products and services, why not expenses too?
A Financial Times journalist recently wrote a scathing article about the FT’s internal expense software, saying employees would rather have a root canal than do their expenses! This may be slightly over dramatic but it demonstrates just how negatively people feel about it – in fact some would rather be out of pocket than do them.
This shouldn’t be the case because technology is available that removes the pain and the paperwork from the process, making it hassle-free to input and reconcile expenses. So many manual processes are now digital, connected devices let us work from anywhere and the contactless revolution is dramatically changing the way we all make payments. These innovations have slashed the time it takes to pay for items and expenses should be no different. Mobile and Optical Character Recognition (OCR) technology, underpinned by cloud-based infrastructure, are at the forefront of making this possible and are spelling the end of expenses as we know it. All employees will need to do is send in a photo of their receipt as the rest can be done for them as technology takes on the heavy lifting of reading, processing and categorising spend.
By letting technology automate the admin you can remove manual processes and simplify the entire experience, freeing up staff to get on with their day jobs. Making the whole experience simple and easy to use also improves compliance.
Employees have higher expectations than ever before and want the latest technology at home and at work. Organisations need to understand that technology can provide a win-win situation for them. Giving employees the freedom to spend easily whilst simultaneously giving Finance better control meets the needs of everyone in a business. Companies need to embrace technology and innovation to make themselves more efficient, keep employees happy and save money. Those that don’t will soon find they’re being left behind.
*PayStream Advisors 2015 Travel and Expense Management Report