If you’re reading this, you probably know that dealing with expenses can be a huge drain on your employees’ time and resources.
At the same time, you probably also know well that it’s a necessary part of running a business, that’s never going to go away.
Most of us who have processed expenses at some point will be familiar with the irritation of figuring out what’s printed on faded receipts, trying to read illegible handwriting, and rectifying claims filed under the wrong category.
This adds to your team’s workload, creates more opportunities for human error, and increases costs to a company overall.
According to a recent study by the Global Business Travel Association (GBTA):
- It takes an average of 20 minutes to complete an expense report for a one-night hotel stay.
- 19 per cent of expense reports contain errors or missing information, which require, in turn, 18 minutes to correct.
- Annually, companies process an average of 51,000 expense reports and spend almost 3,000 hours and approximately half a million US dollars correcting errors.
In other words: a whole lot of resources wasted correcting mistakes and a giant headache for anyone working in a lean organisation (who probably already has more than enough on their plate to deal with).
Here’s how you can help your team level up when it comes to managing their business expenses.
Educate and clarify
Much of the confusion in business expense management arises in categorising costs when there are grey areas.
Other common errors include confusing personal and work expenses, rounding up receipt tallies, and getting those pesky foreign exchange rates mixed up, often leading to misassumptions.
These are avoidable with some education.
Whether your expense management system runs on Excel, paper forms, or SaaS tools, ask your team about their pain points when it comes to lodging claims.
Based on that, create clear guidelines to eliminate any areas of ambiguity or confusion, so they have no excuse for getting it wrong the next time.
To encourage behavioural change, add an extra layer of incentive by gamifying the process for your team. Squeeze those creative juices out and come up with fun ways to reward employees for positive behaviour, while also disincentivising carelessness.
For example, keep a friendly scoreboard, and give out Starbucks vouchers as prizes for the employee whose expense reports required zero corrections (a miracle in itself).
In addition to driving desirable practices, these ‘rules’ can also evolve to be a fun part of your team’s culture, all while encouraging employees to be responsible for their expenses, and mindful of the person processing them.
Move up the technology chain
Try experimenting with different software-based solutions out there to address current inefficiencies.
If you’re currently on Excel, try levelling up with SaaS (Software as a Service) solution like Xero and Travelstop.
Such platforms leverage technology to streamline various functions of the accounting and expensing process, reduce reliance on the team member currently overseeing expenses, and lower the risk of human error.
However, if you belong to an organisation where frequent travel is the norm, you’re probably aware that business travel expenses engender a whole other ball game of complexities.
Many business travellers, especially those new to the workforce, might not be familiar with what more seasoned colleagues already take as a given. For example, recognising that they’re entitled to travel insurance, transport from their home to the airport, and reimbursement for meals.
Additionally, business trips can be made extra stressful by the worry of misplacing receipts when you’re on the move, lodging claims in different currencies, and the headache of translating items you can no longer remember that were recorded in a language you don’t understand.
Tech-based solutions built specifically to cater to companies with international operations and global aspirations can simplify the expense process to make business travel less harrowing.
At the same time, such platforms leverage and crunch the data fed into their systems to provide insights about your organisation’s travel expenses that can help to inform strategic decisions, for example about cost-cutting.
A win for both operations and strategy!
A worthy investment
By changing the way your team manages expenses, you can become your company’s hero, saving them significant resources.
While educating your team may require a front-load investment of time, patience, and money, think of it as a long-term investment in pre-empting costly recurring inefficiencies.
Likewise, while the fees for SaaS are often chargeable per user and will add up depending on the size of your company, chances are, these costs will be incomparable to the price your organisation is already paying for the inefficiencies embedded in your current workflow.
If you’re stuck in a business expensing system that hasn’t quite been working for your organisation, do something about it.
Familiarise yourself with the different solutions available, find out what works best for your team, run a cost-benefit analysis, onboard your teammates, and take your journey towards a more optimised, efficient workplace—one step at a time.