Talking About Outsourced Expense Report Management
The Value of Outsourced Expense Report Software
In this challenging economy, leading companies understand the value of automating the expense report process.
To insure that employees will embrace new processes, the software you purchase must be rapidly deployable, easily integrated into your current infrastructure and intuitive. Plus, it must provide a rapid return on investment (ROI), while offering a low total cost of ownership (TCO).
SinceTravel Expense Management is the second largest controllable cost for many companies, you would expect that it would be a priority for small to mid-sized enterprises to automate the expense report process; to reduce costs, increase efficiency and free employees from the burden of tedious expense reports.
With so many Expense Report Software products flooding the market, ranging from glorified spreadsheets to complex applications that fall just short of traveling for you, selecting the right technology for your company can be overwhelming.
When it becomes so complicated just to identify the best software to automate the process for your company, it is understandable that your purchasing decision is put on the back burner, while you work on 'more important things'. Regardless, if you have yet to automate your T&E expense management system or have implemented a solution that does not meet your needs, you are wasting money and employee time.
While you are slumped over a pile of receipts, scribbling down your expenses for that flight to Omaha or that lousy meal from room service, hoping you can overnight your report in order to be reimbursed on time, your competitors are focusing on mission-critical business tasks.
ExpenseVisor was created with the focus of providing an affordable, comprehensive and flexible T&E Expense Management solution for small-to-mid sized businesses. In working with our clients we have received valuable feedback and insights on the technology needs of enterprises with less than 5,000 users.
In our following blogs, we will attempt to help simplify and expedite your search for the Expense Report Software that is right for your company.
Understanding Your Travel Expense Report Process
Determining the value of automating expense management will depend on the
unique challenges of each organization. Understanding your current process is the first step in ensuring that you maximize your investment in expense report software.
You must understand how your employees function in your current process. Are they racking up costs because they are overnighting reports to meet expense processing deadlines? Are they clear on expense management guidelines so that they do not submit forms with unauthorized charges, requiring additional work by accounts payable, management and employees?
Does your current system help you to:
It will be difficult to determine the best T&E expense reportt software for your company unless you can ask and answer the questions that highlight the strengths and weaknesses of your current process. While this process may seem laborious, you would be surprised how accurate of a snapshot of your current process you can develop from a few conversations with key managers and accounting personnel.
Total Cost of Ownership of an Expense Reporting Solution
Once you understand your current expense reporting process, your next step is to determine what solutions are affordable.
In order to understand this you should determine total cost of ownership (TCO) of the applications you are considering. This involves understanding how long it will take to deploy and integrate your solution, how much time, if any, it will take for your IT department to maintain the system, the cost of the solution, the cost of upgrades, and the time to train employees and how quickly they adopt your new system.
The first fork in the road for TCO in expense report software is determining whether you want a licensed in-house solution or an SAAS 'cloud' model, which is a secured outsourced service. In addition to having a significantly higher cost, licensed applications will require your IT department to monitor and maintain your software. While you have ownership of the software in this situation, which is attractive for core infrastructure technologies, it will put a greater burden on your IT department and the costs of the software tend to be prohibitive for small to midsized businesses.
Today, leading small and medium busnesses as well as enterprises are turning to the Cloud to automate business processes. The simplest way to think of a Cloud Solution is renting software. Expense report software in the Cloud allows you to own all of your information and have access to your application just as you would with licensed software.
The difference is the Clous solutiom is hosted by a professional service provider. You do not incur the IT costs associated with deploying and maintaining licensed software. As a result, installations and upgrades can be done company-wide without having to touch each computer terminal. This mean rapid deployments and upgrades. It is important when reviewing Cloud based expense report software to ask three key questions:
- Is the solution hosted in a secure environment? You need to be confident that your information is safe.
- What is your service level agreement (SLA)? You want to make sure that your system will be accessible and working.
- Do you have a customer support response time guarantee? If you do have a question or problem, you want to ensure that your needs will be addressed within a reasonable time frame.
With a Cloud solution you are subscribing to a software service, and that tends to be significantly more affordable than licensed software. You can usually expect an initial implementation fee and a range in pricing per seat from $7 to about $15.
Within this price range you will discover different contract agreements and functionality. One of the benefits of a Cloud solution is that most vendors have enough confidence in their product to offer monthly subscription contracts that can be cancelled within 30 days - requiring no long
term commitment on your part.
Functionality is the heart of your expense report application, and we will explore how to evaluate functionality in the following section.
Expense Report Software Functionality
At this point, you know the strengths and weaknesses of your current T&E Expense
Report process and the approximate budget for automating it.
The next step in discerning what product offers the most value and identifying the T&E management solution that provides the best functionality for your T&E expense management challenges. The three areas of functionality that are most important are depth, intuitiveness and flexibility. These categories are obviously not mutually exclusive. You will want the depth of functionality to complement and enhance your current process. You will want the application to be intuitive to minimize time to train employees and to encourage acceptance. Finally, you want flexibility. Every enterprise has unique aspects to their T&E expense management process.
If your 'hot buttons' are not addressed by an application's basic offerings, it will be important that the software be flexible so it can be tailored to overcome your challenges without having to pay significant fees. The T&E expense management SAAS market breaks down into three basic categories.
The first is free applications, either stand alone or in a suite. While most of us learned a long time ago that there is no such thing as a free lunch, unfortunately the prospect of a free T&E application can be too tempting for some. There are very few if any T&E expense management vendors that have focused on the needs of small to mid-sized businesses that offer their applications.
These free offerings lack functionality, intuitiveness and flexibility. While the price is attractive, many of your T&E challenges will not be overcome. Your employees will be frustrated by adopting a new process that does not significantly improve their workload and in order to build up the software into the robust offering you need, you will be forced to invest thousands of dollars. Automating current processes with free software is usually akin to wearing shoes that are 4 sizes too small and then moving up half a size. You are slightly better off, but still not the right fit.
The second category is represented by larger vendors who have developed market share with large license deals and are attempting to bring their offering down market. These tend to offer extensive functionality, which is necessary when you are a Global 2000 company. However, when you are a small to mid-sized business, these offerings are somewhat like swatting a fly with a sledgehammer.
Too much functionality means you are paying for a lot of product you are not using, it will be much more complex to integrate into your infrastructure and the bells and whistles can be confusing to employees.
What is also important to remember with companies who are moving their product down market is that their origins are 5 to 6 figure sales deals. With these sales, the customer has the leverage of a large check, which results in an expected performance and support from the product and the vendor.
As a small to mid-sized company you want to be able to easily tailor the product with minimal costs, not be charged for upgrades as if you were a much larger company and have your needs be addressed as if you were a vendors most important account. The question becomes if you are one of thousands of customers and a minimal percentage of an annual revenue, will your needs be met?
The third category are vendors that specifically focus on T&E Expense Management for small to mid-sized businesses. These firms have a number of differentiators. You will want to make sure the vendor serves a diverse customer base. The greater the variety of clients, the better chance the product has evolved through iterations that address various T&E expense management challenges.
You will also want to make sure the vendor's software can easily scale to meet the needs of your organization. While some application might be suitable for 10 to 200 users, does it bog down or crash when extended through a 5,000 user enterprise? Many of these vendors are small-to-midsized companies as well. So you will want to make sure they can provide a robust and stable environment with dedicated servers and daily data backup.
Finally, make sure you have references to assure the availability of prompt and courteous Customer Support. Some of these firms offer web-based only support. Others make you wait as long as 4 days for a response. Can your firm endure a 4 day wait for an open issue? Is Customer Support an extra fee? Are upgrades an extra fee?
The bottom line is that no matter how robust the solution, it will be a long-term disappointment if there is not an excellent Customer Service plan.
Return on Your Investment
You should know which Expense Report Software applications are:
1. In your price range.
2. Have the necessary functionality.
3. Can be easily tailored to meet your unique needs.
4. What SLA and Customer Service guarantees are offered.
You also need to know how long it will take to deploy the software and if the interface is intuitive enough for your process and workforce. This information should allow you to do a general cost analysis and begin to develop expectations for ROI. If the applications can be easily deployed, adopted with minimal training, reduce your costs and increase your efficiency, you should be able to expect rapid and significant ROI, depending on the challenges of your current process.