Travel and Expense Management:
Historically, organizations haven't placed much emphasis on streamlining processes that were not core to their businesses. Even with the pressure of regulatory compliance and the need to cut costs across the business, the approach many organizations have taken with internal processes – including the management of corporate travel and the expense reporting process – has either been "it doesn't seem broken, so why fix it?" or "it's not broken too badly, so we'll continue to live with it the way it is". Driven by the absence of a technology solution that unifies all aspects of corporate travel and expense management, along with a lack of understanding of the benefits to addressing these two processes holistically, organizations continue to spend an inordinate amount of time and money managing the procurement of travel and the reimbursement of expenses as two separate processes.
Despite the fact that billions of dollars per year are spent on business travel and entertainment (T&E) by employees on behalf of their organizations, many companies are still not maximizing the value of that spend because they're relying on multiple processes and solutions to manage their T&E spend – an area that for many is the second largest controllable cost after payroll. Yet, the logical result of every employee business trip is the submission of an expense report, which begs the question, "why are these two processes still viewed as discrete functions by most organizations?" Some forward-thinking companies are taking a new view of the travel and expense management and are taking steps to unite these processes. And some T&E industry suppliers are doing their part to ensure that they develop automated solutions that meet the needs of employees involved with all parts of the travel and expense management process – from travel procurement to expense reimbursement.
Additionally, with the growing trend of on-demand services, companies of all sizes are now able to automate the entire travel and expense management process without having to spend significant dollars or make material changes to their day-to-day T&E business processes.
These same forward-thinking companies are leveraging the power of automated solutions to help unite the corporate travel and expense management processes. This enables them to achieve significantly greater savings and business process efficiencies than by automating each process discretely. Additionally, by streamlining and automating the entire travel and expense management process, companies can further improve employee satisfaction by providing their travelers with greater choice, freedom, convenience and value. Finally, with a single, unified, automated solution, companies can take greater control over, and further enhance, their visibility into T&E spend so that they can make smarter business decisions and ensure compliance.
Understanding The Opportunity
Automated solutions have produced fruitful results for many of the companies that have recognized the need to streamline business processes, increase control, and reduce costs. For example, the following paragraphs, outline how companies have used automation to improve the operations of their business and reduce their T&E spend through efficiency gains and cost reductions.
Automating The Travel Management Process
Lower Travel Costs: Procuring travel online costs significantly less than using a traditional travel agency for air, hotel, and car reservations. In a study by the Institute of Business Travel Management, transactions made on self-booking tools for itineraries (roundtrip air fare, one hotel night, potential car rental) were, on average, $103 less than traditional agency bookings. Sophisticated online booking tools maximize the benefits of free market competition by presenting a complete view of all of the travel content available to the consumer, including negotiated and Internet only rates.
Lower Transaction Costs: A wide variety of options creates more flexibility and convenience for the traveler, instilling confidence that the online booking tool is presenting a complete view of the available travel options and increasing the likelihood that the traveler will choose a rate within the guidelines of their corporate travel program. In addition to these hard dollar savings and increases in convenience, online bookings also result in lower transaction fees. With the need for human intervention to complete a reservation dramatically reduced, recent studies show that the transaction cost for an online-booked reservation was 40 to 50% lower than an agency-assisted reservation.
