The business world has embraced accelerated digital transformation as a result of the pandemic, but nowadays, employees are eager to restore some physical ways of working that are beneficial to their company, such as travel. This is reflected by research which reveals that 46% of employees believe it is better to build relationships from in-person connections and 41% highlight increased productivity when meetings are face-to-face.
However, considering the turbulent economy, Gabriele Indrieri, VP & Managing Director for SAP Concur EMEA South, points out that it is vital for businesses to make efficient choices, especially when it comes to resources. “It’s for this reason more decision-makers are weighing up the cost-benefit of corporate travel and looking for saving potential.”
To assist businesses in reaping the benefits of business travel while protecting the bottom line, he outlines five tips to consider:
- Minimize errors to reduce overspending: If employees manually enter and itemize expenses, they are more at risk of making costly mistakes. Therefore, investing in smart technologies, although initially can be costly, will mitigate this and instil long-term cost and time efficiencies. For example, tech can pull individual charges from credit card providers automatically or integrate charges and receipts directly from hotels, airlines, and rental car companies, or uploaded them as photographs by travellers – ultimately eradicating the room for error.
- Enforce practical policies: Only one in three employees believe that their company’s travel and expense policy is well-fitted and fair, according to SAP Concur research on expense fraud. Not only do expense policies need to streamline processes, but they also need to align with the company’s culture. Therefore, finance teams must consider how policies will work in practice, as it’s unlikely that they will suit every employee, meaning that flexibility will need to be built into their approach.
This could be implemented through platforms that enable administrators to flex policies by creating multiple versions within the system that can be applied to different employees based on individual factors, departments, and offices. It is then essential to continually check whether the policies remain suitable for the workforce as time goes on. Regular automated audits are the best way to do this for overall, accurate visibility and to prevent finance teams from manually sifting through every single transaction.
- Communicate policies regularly: Often when employees overspend, it’s because they are not aware of the budget allowance. This can be mitigated by ensuring a clear budget and that all employees are working within the expense policies laid out.
However, only a third of employees say that their company’s travel expense policies are easy to understand with another only another third of employees taking action to avoid unconscious fraud. By frequently checking their policy for updates, employees will know the importance of facilitating travel bookings. In addition, professional travel booking solutions that make travellers aware of the bookings being covered by the company’s policies or not will reduce the number of potentially costly out-of-policy bookings and allow for peace-of-mind.
- Streamline VAT reclaim: Many companies still fail to reclaim VAT, even though they lose a large amount of money as a result. This can be attributed to the use of inefficient tools and the fact that processing VAT claims and ensuring compliance can be complex. Using a solution that removes the need for businesses to manage their VAT reclaim manually can lead to significant time and cash savings while minimizing compliance issues.
- Rely on data when negotiating rates: Discounted prices add up to real savings. But, to negotiate rates, you need to track spending with each supplier. This can be challenging without the right tools to sort through inconsistent spending data that is captured from credit card feeds and other sources. Plus, when employees book outside of the approved system, those expenses may not even be captured. As such, if businesses harmonize their spending data from all booking sources, they will be positioned to demand the best prices.
“The pandemic has transformed the way we work, with virtual communication and digital tools to collaborate becoming the norm. However, it’s clear that there’s no substitute for the kind of in-person connections that business travel enables,” says Indrieri. “By adopting a strategic approach that takes into account the cost-benefit of each trip, businesses can take advantage of this by creating a cost-efficient travel program that allows employees to build valuable relationships and maximize productivity.”
“Now is the time to take action and plan for the future, with a focus on sustainable, cost-effective travel that enables businesses to thrive,” he concludes.