New Technologies and Best Practices in Expense Management: Insights to Drive Growth

New Technologies and Best Practices in Expense Management: Insights to Drive Growth

Bob Neveu

Tim Harrison

October 14, 2014 Sponsored by:

© 2014 Institute of Management Accountants. Inside Talk Webinar Series. All rights reserved.

Moderator

Steve Shannon

Director

Partnership Marketing

IMA

2


Featured Presenter

Bob Neveu

President, Cofounder

Certify, Inc.

3


Featured Presenter

Tim Harrison

Director of Corporate Systems

H&R Block

4


Learning Objectives

Upon completing this webinar, you will be able to:

1. Leverage technology to establish visibility and control of T&E expenses

2. Understand current and emerging technologies available for T&E management

3. Discover how to build an effective business case for T&E management automation by understanding key components of the ROI

4. Identify how to manage and mitigate T&E expenses at your company

5

© 2014 Institute of Management Accountants. Inside Talk Webinar Series. All rights reserved. 6

• Online travel and expense management software provider since 2008

• 64 languages,140+ currencies, clients in 18 countries

• Over 15 million expense transactions in 2013

• Processing over $5 billion/year in expense reports

About Certify


Expense Management Outlook for 2014

Data compiled from Certify’s 3rd Annual Expense Report Survey with responses from over 800 Finance professionals in the U.S. (56% C-Level or above, 84% mid-sized companies and above).

43%

29%

18%

5% 4%

Cloud/Web-Based

Excel/Spreadsheets

ERP

Home-Grown

Pen & Paper

How do organizations currently manage their travel and expense reporting?


Expense Management Outlook for 2014

• Travel and entertainment (T&E)—second only to payroll as the largest business expense, accounts for 10%-12% of total annual budget

• 59% of organizations want to improve their expense management process

• 62% of organizations want better analytics and insight into T&E spend

• Only 30% of organizations utilize mobile expense applications

• 80% of all organizations indicate they plan to switch to cloud expense management within the next 18 months

T&E Pain Points

Most critical areas to improve in 2014

Reference: Certify Annual Travel & Expense Management Survey 2014


Key Strategic Actions to Improve Processes

1. Automate key components of T&E expense management

• Ranked #1 as top priority in 2014 by 52% of companies in 2014 Aberdeen Report

2. Take measures to improve and enforce corporate T&E policies

• Ranked #2 by 48% of companies

3. Arm travelers with better technologies to make T&E expense management simpler and faster

• Mobile applications• Globally accessibly tools

4. Leverage analytics to improve intelligence and data Reference: Aberdeen Group 2014, The Traveler & Expense Management Guide for 2014


Eliminate manual data entry from system-to-system

Automate Key Components of T&E

Areas for automation surrounding T&E:

• Use auto-fill (parsing) technology to extract expense data from receipts – eliminate manual entry

• Auto-generated expense reports – expense report automatically created by matching receipt images to expense data

• Direct feed to Accounting, HR & corporate credit cards – eliminates manual data entry between systems

• Automate approval workflows – managers notified of electronic reports pending approval Reference: Certify Annual Travel & Expense

Management Survey 2014

Must-Have Features From a Cloud-Based System



Automate Key Components of T&E

Expense report automation is the #1 feature CFO and Finance professionals look for when selecting a vendor (64% of CFOs say it is the #1 most important feature)

Largest pain point surrounding T&E is employee’s failure to submit expense reports on time (50% of companies say this is the #1 pain point)

AutoFill (parsing) functionality to eliminate

manual data entry


Improve & Enforce Corporate Policy

• 49% of companies name top financial pressure to improve compliance to company policies & reduce T&E costs

• 19% of expenses submitted are “fraudulent”, with average expense amount of $115 on a manual system

• 5% of employees commit 82% of all fraud

• Best-in-class organizations using cloud-expense are experiencing up to 91% compliance rates

“Setting hard travel policies around formerly ‘gray areas’ such as seat upgrades has trimmed travel spending by 10% to 20%”

Linda Parcher, VP and CPO, Diebold, Inc.

Wall Street Journal

#1 way to reduce T&E costs: Improve compliance to T&E polices



Utilizing Technology to Gain Control

How to increase policy compliance:

1. Create corporate travel and entertainment expense policy

2. Integrate policy into expense system, setting both:• Hard Policies (decline expense

exceeding X amount)• Soft Policies (manager’s discretion for

approval)

3. Allow technology to enforce policy, notifying employee and manager of policy violations• Missing receipts• Duplicated• Items exceeding spend limits • Etc.


Flagged violation, notifying manager amount exceeded

policy limit


Arm Travelers with Technology

• Online travel booking system

• Used by 87% of all Best-in-Class companies

• Control the expense before it occurs

• Spend captured quicker and in compliance to policies

• Mobility: Second most important feature when selecting an expense vendor; 45% of companies named it #1

• Users of mobile expense applications have reduced their expense-processing costs by 65%

• Enable travelers with the power of mobile: receipt capture, enter expense data, review & approve expense

• End-to-end expense management system:

• Robust platform helps streamline and automate processes

• Accessible from anywhere, anytime


Leveraging Technology for Visibility• 55% of all organizations name main

priority for 2014 to enhance visibility into overall T&E spending

• Visibility into T&E spend: 30% visibility with manual process; 61%+ visibility with web-based system

• 74% companies using cloud expense systems regularly audit expense reports vs. 44% of companies on manual system

Types of visibility gained with cloud technology• Documented path of approvals• Expense by employee• Expense spend by category Visi

bility

into

T&E S

pend

Regul

ar R

epor

ting

Regul

ar A

udits

of E

xpen

ses

Autom

ated

Dat

a Ana

lytics

61% 57%

74%

57%

30%

40%44%

29%

Web-Based Expense SystemManual Expense Process


Leveraging Technology for Visibility

Benefits of automated reporting:• Identify intelligence over key areas

of business travel that need consolidation (airfare, lodging, etc.)

• Identify major suppliers to negotiate savings (volume discounts with supplies such as hotels)

• Identify spend by employee, identify repeat policy violators

• Identify areas of excessive spending and use spending trends to create T&E policies


H&R Block

• World’s largest tax services provider

• 12,000 retail tax offices in U.S., another 1,700 abroad

• Upward of 100,000 employees world wide at peak tax season

• Over 58,000 people creating and submitting expense reports in North America


• Mix of manual and electronic processes • PeopleSoft module for T&E

• Create expense online• Print & attach paper receipts• Forward report and receipt to manager for approval• Field users would mail expense reports into

corporate office• Electronic reporting and approvals• Reconciliation done manually, comparing paper

receipt to electronic version

Prior Expense Report Process


Biggest Challenges

• Digitally matching receipts to credit card transactions• Time to manually prepare expense reports, reconcile

data and audit expense reports

Identify Vendor Requirements

• H&R Block is focused on digitization• Application must be simple to use, low learning curve• Mobile was a key requirement for real time capturing of

receipts• Paperless state was a requirement• International support for our global organization• Leverage OCR & autofill capabilities

The Switch to New Technologies


Conference Room Pilot• IT & Management vetted vendors’ ability to meet

functionality, implementation and support requirements

• Allowed end users to select the vendor• Higher adoption rate if users choose solution• More user interaction = maximize ROI on system

• Ten end-users piloted three competing expense vendors and cast their vote• Management, IT, HR not included in voting

• 9 out of 10 users selected Certify

The Vendor Selection Process

“Software for the people, by the people”


Implementation

Implementation Details• 58,000+ users in North America (U.S. & Canada)• Integrate with:

• Corporate credit card transactions from bank• HRS Feed for employees, departments, projects and approval hierarchies• Single Sign On capabilities (Web & Mobile)• Feeds for Accounts Payable

The Forecasted Implementation Timeline

Go Live with Certify

May October

Select Vendor Go Live: October 1, 2014Select Certify

Launch Implementation

58k U.S. & Canada users go live, 6 weeks ahead of schedule

August


• Average Process Lifecycle – Reduced from 54 days in PeopleSoft to 15 Days in Certify.

• Faster Auditing Process – 100 expense reports reviewed in 1 hour, compared to 4+ hours previously.

• Mobile Capabilities – Users reduce time spent on creating expense reports.

• Digital Initiative – Eliminated 4,000 pieces of paper in the first month of use. Will increase as Tax Pros come on board for tax season.

• Reconciliation - Eliminated manual reconciliation of expenses and receipts.

• Enforce Policy – Insights into automobile mileage via mapping and route functionality.

• Standardization – Created single, global platform with Single Sign On capabilities for web and mobile users.

The Benefits


• Define requirements from Accounting, End User & IT teams to narrow vendors quickly, prior to going to RFP

• Align IT, Accounting, HR departments prior to implement, building plan of attack for rolling out – “all hands on deck” approach

• Allow the end users to drive vendor selection to maximize adoption rates and aid in gaining an ROI (Conference Room Piloting)

• Organize internal efforts to facilitate transition for employees (documentation, training, support, etc.)

Key Elements for Success


Questions & Answers

Use the Q & A Panel to send your questions to our panelists.

Bob NeveuPresident, Cofounder

Certify, Inc.

Steve ShannonDirector

Partnership MarketingIMA

24

Tim HarrisonDirector of Corporate Systems

H&R Block


Thank You to Our Presenters!

Bob NeveuPresident, Cofounder

Certify, Inc.

25

Tim HarrisonDirector of Corporate Systems

H&R Block

Thank You to Our Sponsor!

www.certify.com

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New Technologies and Best Practices in Expense Management: Insights to Drive Growth