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T&E Done Right: The Three Pillars of Visibility, Benchmarking, and Control
- 1. T&E Done Right The Three Pillars of Visibility, Benchmarking, and Control Ernie Humphrey, CTP
- 2. 2 Today’s Presenter Ernie Humphrey Chief Executive Officer 360 Thought Leadership Consulting 360 Thought Leadership Consulting helps companies define and unlock the strategic value of their thought leadership programs. Formerly, Ernie served as Vice President, Educational Programs for Proformative, as the Director of Treasury Services and as a Director of the Corporate Treasurers Council for the Association for Financial Professionals.
- 3. 3 About Certify • Integrated, automated solutions for travel, expense, accounts payable invoice and purchasing • 64 languages, 140+ currencies, clients in 80 countries • #1 G2 Crowd for user satisfaction in expense management software (2014-2019) and Momentum Grid leader in expense management software (2018) • PC Magazine Editors’ Choice for best expense tracking software (2015-2019) • Processing expenses and receipts valued at $3.3 billion annually
- 4. 4 Webinar Info & CPE Credits • CPE Credit: To claim your CPE credit, please answer all polling questions and remain online for the duration of the webinar. • Questions about CPE Credits? Your credit will be emailed to you within three business days. If you have questions, please email Mike Lamberti at mlamberti@certify.com • Join the Discussion: We will have a Q&A at the end of the webinar, and will email you a survey once the webinar concludes.
- 5. 1. Why T&E Matters 2. T&E Processes and Spending: Why Visibility Matters 3. The Art of Controlling T&E Spend 4. Mitigating Inefficiencies in T&E Expense Reporting 5. Reducing T&E Fraud Exposures Our Agenda
- 8. T&E spending ranks as the second most difficult operating expense category to control. Forrester Research 2014
- 9. T&E Processes & Spending: Why Visibility Matters
- 10. 10 Polling Question 1 How would you characterize the level of visibility your company has relative to T&E spend? a) Poor or non-existent b) Decent–but we have blind spots c) Good–but we can do better d) Optimal–real-time visibility e) Other
- 11. 11 The Art of Leveraging Benchmarks Focus on what matters Continually verify what matters Compare “apples to apples” Compare data over time Compare data across industries The magnitude of trends The direction of trends The driver of trends
- 12. 12 Certify SpendSmartTM Year in Review Report 2018 YEAR IN REVIEW Key business travel trends and expense benchmarks The SpendSmart™ Year in Review Report tracks T&E spending benchmarks drawn from more than $3.3B in expense transactions processed by Certify in 2018. Certify identifies the leading expense categories, most expensed brands, and those who are earning the highest ratings.
- 13. 13 T&E Spend Benchmarks T&E Category Benchmark Averages in 2018 Percentage of total annual T&E transactions by expense category based on more than 50 million receipts and expenses processed by the Certify system in 2018. Certify SpendSmart™ Year-in-Review Report, 2018
- 14. 14 T&E Spend Benchmarks Certify SpendSmart™ Year-in-Review Report, 2018 Average Expense Cost by Category
- 16. 16 Popular and Most-Loved Brands in 2018 Certify SpendSmart™ Year-in-Review Report, 2018 The highest rated brands and most popular vendors by share of expense receipts
- 17. 17 Most Expensed Brands by Category Certify SpendSmart™ Year-in-Review Report, 2018
- 18. 18 Highest-Rated Brands by Category Certify SpendSmart™ Year-in-Review Report, 2018
- 19. 19 T&E Spending Trends Ground Transportation Trends Uber continues to hold the top spot for ride hailing, even as Lyft’s user ratings grew to 4.7 out of 5 stars. Taxis are trying to keep up, but demand is dwindling. Certify SpendSmart™ Year-in-Review Report, 2018
- 20. 20 T&E Spending Trends Certify SpendSmart™ Report, First Quarter 2019 Ride Hailing Trends in North America Ride hailing is most popular in its birthplace of San Francisco, with Dallas and Los Angeles close behind. Taxis are maintaining their ground in the New York City and Chicago metro areas. View the infographic at: http://www.certify.com/Certify-SpendSmart-Report-Infographic-Q1- GroundTransport-2019.aspx infographic here
- 21. 21 T&E Spending Trends Food Delivery Grows Another signal of shifting business traveler preferences is the gravitation to digital brands that provide the convenience of a warm meal delivered right to one’s hotel or office. The category has seen a 118% year- over-year growth compared with 2017. Certify SpendSmart™ Year-in-Review Report, 2018
- 22. 22 T&E Expenses Gone Wild Certify, The Craziest Expenses Survey: The Best of 2013-2018 HumanSkull $800 | 2013 “Purchasing a human skull for a medical experiment, I would say classifies as an ‘out-of-the-ordinary’ expense” Finance Manager Helicopter Ride to Work $6,500 | 2017 “Needed to make it to a client meeting.” CIO Hotel Bill and Flight Changes $800 | 2013 “Hotel bill and repairing hole punched in the wall; airfare rebooking fee due to missed flight while in jail.” CFO
- 23. 23 T&E Expenses Gone Wild Certify, The Craziest Expenses Survey: The Best of 2013-2018 Lama Rental $150 | 2016 “Photographer wanted a llama in the picture.” VP Marketing Towed Vehicle $150 | 2014 “Parked illegally due to the importance of appointment.” Web Designer Separate Hotel Room for Root Vegetables $85 | 2015 “I wanted a room for garlic samples; couldn’t stand the smell.” Salesman
- 24. 24 T&E Expenses Gone Wild Certify, The Craziest Expenses Survey: The Best of 2013-2018 CherConcertTickets $125 | 2014 “Expensed by an employee at a small company.” Employee Boarding for Pet Snake $30 per day | 2017 “Critical expertise needed with limited resources.” Independent Rental Owner Men’s Rolex Watch $8,000 | 2018 “Customer appreciation.” Manager
- 25. The Art of Controlling T&E Spend
- 26. 26 How Companies Set T&E Spending 2018 Expense Management Trends Report, Certify, Inc. We do not have expense category spending limits Budget based on company historical spending Follow U.S. GSA per diem rate guidelines Determined by annual budgeting process Other 30% 7% 13% 21% 29%
- 27. 27 Polling Question 2 Do you have a written travel policy at your company? a) Yes b) No c) Not sure
- 28. 28 T&E Policy: The Foundation of Control An effective corporate travel policy: • Is clear and simple to follow for all employees • Is up-to-date with rules, partners, and discounts • Manages the average traveler within the organization • Allows for reasonable accommodations • Contains clear explanations for limits and restrictions • Considers travel vendors with discounts and preferred pricing • Enforces legal compliance with IRS standards and other regulations
- 29. 29 Accessing Your T&E Policy Questions to Ask • How is travel currently booked? (air, hotel, car rental) • What is the process for employee reimbursement? • Who is responsible for booking travel? • On average, how many days in advance is travel booked? • What is the average cost of booked travel? (Include: hotel, airfare, car rental/taxis/ride-shares, meals) • What is the general level of travel being booked? (Business class airfare, 3-star hotels, upgraded car rentals, etc.) • Who is overseeing and approving booked travel? • On average, how many employees are being booked for each trip?
- 30. 30 Driving T&E Policy Compliance • Leverage technology to enforce compliance • Educate business travelers and all managers who approve T&E expenses • Review your T&E policy with all employees at least annually • Deliver easy access to your T&E policy • Deliver easy access to T&E policy FAQs • Develop a culture of accountability
- 31. 31 Driving T&E Policy Compliance Incentives to Drive Policy Compliance • Monetary – reward employees for saving company money • Point systems – gamify policy compliance • Contests – incentivize and motivate teams • Penalties – use minimally to avoid negative morale effects
- 32. Mitigating Inefficiencies in T&E Expense Reporting
- 33. 33 The Hidden Costs of Expense Reporting • Hours to create, review, and approve reports • Hard costs for paper, printing, and postage • Time required for reconciliation and reimbursement • Storage fees to archive expense reports • Lost productivity and lost opportunity
- 34. 34 Expense Reporting Pain Points Employees AccountantsManagers Gather receipts, itineraries, and write down non-receipt items Enter expenses in Excel with category, vendor, dates, etc. Print spreadsheets, tape or staple receipts, and make copies Sign report/ date report and present or mail to manager And then…wait
- 35. 35 Expense Reporting Pain Points Employees AccountantsManagers Receive reports for all employees at different times during the month/quarter Check expenses for receipts, review for out- of-policy items, etc. If errors appear, return report to employee to start over; wait for resubmission Sign/approve reports and route to the next manager or to AP
- 36. 36 Expense Reporting Pain Points Employees AccountantsManagers Receive reports for all employees at different times of the month/quarter Check for receipts, manager approvals, out- of-policy items, etc. Match receipts with line- items, verify all charges, dates and vendors Manually enter expense data into accounting software Manually enter data from accounting software to payroll for reimbursement
- 37. 37 Polling Question 3 What is the main system your company currently leverages for expense management? a) Manual process/Microsoft Excel b) ERP c) Automated system (Certify, Concur, etc.) d) Homegrown solution
- 38. 38 Methods for Managing T&E Reporting Homegrown solution Pen and paper ERP/accounting package (Oracle, SAP, etc.) Microsoft Excel/spreadsheets Web-based solution 2018 Expense Management Trends Report, Certify, Inc. 34% 33% 17% 10% 6%
- 39. 38% 18% 2% 9% 32% 39% 34% 12% 5% 10% 28% 42% 13% 5% 12% 39 T&E Systems by Company Size 2018 Expense Management Trends Report, Certify, Inc. SMALL BUSINESS MID-SIZE BUSINESS ENTERPRISE Web-based solution (Concur, IBM, etc.) Microsoft Excel/spreadsheets Pen and paper Homegrown solution ERP/accounting package (Oracle, SAP, etc.)
- 40. 40 Must-Have Expense Reporting Features Simplicity/Ease of Use: Improve on-time submission, compliance with policy, and increase employee adoption. Automated Features: Improve expense report process efficiency and reduce overhead costs. Accessible Anywhere: OCR receipt capture and anywhere accessibility make T&E easy for employees. Integration Services: Connect systems to reduce errors and manual data entry; ERP; HR; corporate/credit card feeds. Reporting Analytics: Greater visibility into process and spending by category, department, employee, etc.
- 41. 41 Top Features/Sources of ROI How ROI was generated: Improved efficiency/expense reporting process 58% Reduction in processing costs (paper, postage, storage etc.) 53% Mobile accessibility 30% Increased employee productivity 27% Travel booking control (pre-trip authorization, etc.) 23% Reduction in overhead/staffing requirements 23% Elimination of payment for duplicate expenses 22% Reduction in fraudulent expenses 22% More accurate mileage tracking/mapping 17% Other 17% 2018 Expense Management Trends Report, Certify, Inc.
- 42. Reducing T&E Fraud Exposures
- 43. 43 T&E Expenses Fraud Exposures • People Fictitious, overstated, mischaracterized or duplicate expenses • Process Ineffective controls and/or oversight in identifying out of policy expenses • Technology Ineffective and/or manual audits and controls
- 44. 44 Expense Fraud Preventative Measures • Implement a formal written travel and expense policy. • Train all travelers on your policy and establish accountability in complying with all policy provisions. • Enforce all of your T&E policy provisions. • Implement cost monitoring measures such as proactive data monitoring/analysis.
- 45. 45 Closing Thoughts • Visibility into T&E processes and spend is critical for T&E expense management. • Leveraging benchmarks is a valuable tool in managing T&E expenses. • An effective T&E policy is a key pillar of T&E expense management. • The right technology in conjunction with employee education mitigate fraud exposures while driving T&E policy compliance.
- 46. 46 Additional Resources Q1 2019 SpendSmart™ Reports & Infographics: http://www.certify.com/CertifySpendSmartReport.aspx 2018 Year-in-Review SpendSmart™ Report & Infographic: http://www.certify.com/CertifySpendSmartReport_Q4-2018.aspx SpendSmart™ Benchmark Calculator: https://www.certify.com/benchmarkquiz.aspx 2018 Expense Management Trends Report: https://www.certify.com/WhitepaperViewer.aspx?url=http%3A%2F%2Fma.certify.com%2F2018_TE_Tr endsSurvey&title=2018%20Expense%20Management%20Trends%20Report&type%20=undefined 2018 Craziest Expenses Survey: https://www.certify.com/the-craziest-expenses-survey-the-best-of-2013-2018.aspx
- 47. 47 Polling Question 4 If you haven’t made the switch to an automated expense management software, what is the primary reason for this? a) Too time consuming b) Lack of executive level support in moving forward with the process c) No available budget d) We don’t feel we need to make the switch yet e) We have already made the switch to automated expense management software
- 48. Any Questions?
- 49. Thank You!