On the heels of the Concur Fusion conference (discussed here by Andrew), I thought it would make sense to look at travel and expense management more closely.
It was sometime in mid-2009 that I first heard the following phrase: “We’re looking at travel and expense as being more strategic here internally.” It was uttered by a CFO at a mid-market telecommunications company in one of my frequent conversations with the finance/procurement/travel community. Up until that point, the travel / expense management function was largely considered a back-office set of processes. The CFO didn’t stop there, adding, “There’s value in managing it well and managing it in a strategic fashion.”
In the years since, I think we’ve all learned one critical item about travel and expense: there’s much more than meets the (business) eye. And, as expected, more and more organizations across the globe perceive the travel and expense management process (and function) to hold strategic value beyond the reduction of manual, paper-based processes and the resulting, tactical cost savings that arise from full- or even partial-automation.
Business travel often comprises a considerable mass of the typical corporate budget – executives need to meet with other executives, the sales team requires travel as a part of effective business development, and other internal divisions rely on industry and educational conferences / events as a way of boosting expertise in their respective areas. As business travel budgets rise and more expense reports are funneled through internal corporate avenues, organizations now have the opportunity to transform travel and expense management into a series of value-added processes that can have more than just cost consequences.
How is this evolution going to occur? What can we anticipate happening over the next few years in this space? A few things come to mind:
- Travel data becoming as crucial as other types of business intelligence. Think about the truly strategic functions within the average organization: finance, procurement, IT, human resources, treasury, etc. For these units, data reporting / analytics is important in driving visibility into items such as status of payments, turnover rates, spend under management or cost reductions. As travel hits that strategic pinnacle, data related to this category will become crucial. Data related to frequency of travel, regional- or unit-specific travel or even travel supplier management will play a vital role in any corporate budgeting initiative.
- Mobility as the technology-of-choice for all travel / expense management automation. The interesting thing about mobile technology is that it shifts, evolves and changes on near-daily basis…regardless of the industry. So, while travel and expense evolve year-to-year, the advent of mobile applications within this space will continue to double-down the benefits for business travelers and executives alike. Capabilities such as enhanced travel-booking, linkage between travel and social media, access to real-time intelligence, and enablement of simpler on-the-road processes (hotel check-in, reservations, digital receipt imaging, etc.) will revolutionize the travel / expense industry.
- ‘Next-gen’ travel-related metrics monitored as closely as historically-critical finance metrics. With the complex spend arena, there are tried-and-true metrics that organizations have leveraged to gain intelligence and visibility into spending and suppliers. However, with indirect spending traversing beyond the realm of supply management (relative to each category’s influence on achieving organizational goals and objectives), it has become crucial to dig beyond savings and supplier-management-related metrics to understand the true implications of complex categories. Within the next few years, we’ll see qualitative metrics (such as the quality / effects of business travel) and revamped metrics (like the ROI of business travel) become as equally as significant as classic financial metrics, including cash-on-hand and performance / spending against corporate budgets.
