Travel and expense are two sides of the same coin. Even so, many travel managers struggle integrating travel and expense programmes together as data integration between multiple different systems has always been a major challenge.
Covid-19 has caused sudden, dramatic changes to the economy leaving many business owners uncertain of the future. Understandably companies are looking to control cost and maximize revenue more than ever before. A recent PWC survey acknowledges that over 80% of CFOs report that their company is considering implementing additional cost control measures over and above what they had before Covid-19.
If we want to control expenses – visibility on where spend is happening is crucial, yet only 63% of travel programmes access expense data and use it in their programmes. Most rely on TMC data as it shows the most detail, yet TMC data only shows 60% of travel expenses. This leaves a divide between the spend travel managers report on and what is actually leaving the bank account. According to a research report with Concur and Vanson Bourne, 86% of finance leaders agree that their travel, expense, and invoice systems could be better connected for a single view of spend.
Why do travel managers struggle with integrating expense data?
Expense has often been a paper-heavy task separate from Travel. Employees collect receipts and fill in reports post-trip. Processes in Expense reporting is, for the most part, directed by Finance and Accounting and not Travel. Travel then has to integrate this data into their processes afterwards.
Travel booked through the agency and travel expenses are thus reported in siloed systems. Merging separate data sets is a heavy task for analysts and travel teams. As more manual work is done on the data – the opportunity for error grows.
So how can travel manage expense more effectively?
Reinvent the payment method
Payment technology has seen significant advances in the past few years. Thanks to digital payment methods, we may no longer refer to the corporate card as a “card” but as “payment” as the technology moves beyond plastic.
New payment methods, like virtual cards, allow for a more seamless payment, management, approval and reporting process. Companies like Conferma Pay and others allow payment to happen via a mobile device. The data from this payment can be immediately integrated with agencies, booking tools, GDS’s and banks.
Advances in virtual payment technology allow travel managers to integrate their policies into the way company cards can be used. Travel managers can now set transaction and budgeting parameters for specific cards. These parameters can be overall spending limits for defined time periods. They can even go as far to ban purchases from a particular merchant category code, or a specific vendor.
Large expense management and automation conglomerates are incorporating virtual cards into their portfolio. At the start of 2020, the Certify and Chrome Rover merger rebranded as Emburse – the name of the startup payment provider the conglomerate acquired in July 2019. Soon after the rebranding, Emburse release a companion payment card across its six expense brands, starting with Abacus.
Incorporating these new payment methods makes the reporting easier as we don’t have to dig into siloed systems.
Use advanced analytics
It doesn’t stop at introducing new payment solutions. Depending on traveller sentiment within your organisation, not all travellers may be adopters of this kind of technology. Even if they are, there is, ultimately always going to be leakage. Receipt collection and expense reporting will never vanish entirely.
This is where we need to look at analytics. According to an article by Phocuswire, 63% of companies access travel and expense data via Excel templates, 56% via a TMC dashboard and only 31% use a defined intelligence solution to bring all this data together.
We already know that TMC dashboards do not provide a full picture of spend. Manual integration often encounters data quality and accuracy issues due to manual input.
Using a data intelligence tool to automate data integration can help minimise human error and make the process of integration much faster. The only problem is, many business intelligence providers are still stuck using old, legacy software technology that come back with errors in the data. This outdated technology can also take hours to load a single report.
Apply machine learning to automate the process
Analysing the expense and travel data is just not enough. In 2020, we need to get smarter about how we do it.
Advances in cloud technology has made integrating large loads of data easier than ever before. Companies who take advantage of this are sure to be able to control expenses more effectively.
Machine learning technology can also do wonders for the entire expense process altogether. AI is already being used to detect employee expense fraud.
In the future, AI can make expense management even more advanced. Imagine if there was no need for a manual approval expense process? Rather, the entire journey can be automated with machine learning models weeding out problematic transactions.
In our ideal world, travellers would pay with virtual cards connected to their existing systems like TMCs; the data analysis would contain an accurate view of both travel and expense spend, the reports would be generated weekly rather than monthly and there will be no need to wait on a Manager to approve expenses, rather, an AI-based system can approve and flag each transaction immediately.
You may think this future is far away, but it is not. In fact, our product Inspector can already automatically detect hard-to-find fraudulent transactions. Virtual payment is also fast becoming a reality. Cloud-based technology is removing the need for spreadsheets and clunky legacy software to make way for faster and more accurate analyses.
In a time when we need more control over travel expenses than ever before, we need to start innovating and taking the steps to a much easier expense reporting process for travel managers, department heads and travellers alike.