Spend management consolidation improves visibility
It’s not unusual for a company to have one set of tools for accounts payable (AP), a completely different set for expense reimbursements, and another set for company cards – and that these systems don’t handle only US payments and the needs of a US-based workforce.
Add to that the complexity of a remote global workforce and multiply that by the number of countries a global company can operate in, and administration, visibility, and control become even more challenging for accounting teams.
But software vendors have been working hard on the problem for the past few years. They have created consolidated platforms that allow administrators and employees to manage all flows associated with all non-salary expenses. This includes all inputs and approvals from procurement to payment forms all the way through to payment and reporting – in one system.
“Systems have really come a long way to allow us to do this,” Hicks said.
See also: Virtual cards are becoming the Swiss army knife of expense management in a work-from-home world
Create a source of truth
Having a consolidated payment platform benefits the organization in several ways, Hicks said. By simplifying user administration, allowing integration of the platform with a human resources platform (HRIS) and synchronizing information with the enterprise resource planning (ERP) or GL system, it streamlines the whole process.
“It frees up time for your team to really look at the data, analyze the results, and really make sure you’re focusing on the right part of the process – and not just making sure they’re all logged in, adding users and answering questions about all the different tools,” Hicks said.
Another benefit is visibility and reporting on this data. It’s much easier to get real-time spend insights and spend trends from a single system. It’s also easier to implement consistent controls across the organization.
“If you make this single source of truth accessible to everyone, and that’s where they spend their money, you can really leverage those workflows,” Hicks said. “You let the organization do what it should do, which is build its function and move it forward, without worrying about how it has to get the right approval for those funds, or the best way to do it or what system to go to.”
Leverage technology to adapt to change
An August 2021 PYMNTS study found that 36% of US and UK businesses plan to innovate in their expense management and control.
Read more: PYMNTS August 2021 Business Expense Handbook
Several factors are behind this, Hicks said. First, the tools available today are much better than they were a few years ago, so businesses can now use them to create a best-in-class system.
Additionally, companies have learned that they need to be more adaptable in light of wider uncertainty – better visibility into the numbers allows them to do this. The shift to a remote workforce has also helped drive adoption.
“People are realizing that leveraging this kind of technology helps them change and adapt to all kinds of changes that come quickly,” Hicks said.
There’s also a desire to reduce expense report violations — the number of which soared 292% in 2020 as employees suddenly working from home confused about the eligibility of different expenses, PYMNTS found.
“If you put the tools in place, you can really help an employee understand how to spend the company’s money,” Hicks said.