By Fok Wai Leng, Managing Director, Southeast Asia, at SAP Concur.
It’s been more than a year now since employees walked away from their cubicles and offices and settled into the new normal of working from home. As dust fell on office furniture throughout the world and dining tables became global headquarters, changes in employee spending patterns also took place.
According to the Oversight Spend Insights March 2021 report, before the pandemic, 4 percent of employees worked remotely. By mid-March 2020, 40 to 50 percent were working from home and required electronics, office equipment, and other supplies.
Work-from-home purchases were bucketed into the miscellaneous category or mail/phone order. These categories created risk as they made it difficult for managers and finance teams to easily identify types of purchases and whether or not they were compliant. In fact, in 2020, Oversight found a 292 percent YOY increase in the T&E spend violation rate.
That said, in a survey conducted by BrandConnect and commissioned by SAP Concur, 74 percent of executives throughout the world felt optimistic about their organization’s financial outlook for the next twelve months. These executives are now turning their sights toward growth and, as part of this process, they recognize the need to have full spend visibility across the organization.
Visibility is key to keeping costs under control. In order to gain visibility, businesses must re-examine their expense policies and determine what adjustments need to be made. This action will help prevent the miscellaneous expense bucket from muddling spend visibility like it did at the beginning of the pandemic.
As more and more offices re-open, it’s very likely the new normal for many businesses will be a mix of remote and office work. Global Workplace Analytics estimates that 25-30 percent of the workforce will work from home for several days a week by the end of 2021. Given this, businesses can’t just return to pre-COVID expense policies, nor can they continue new expense policies they may have put into place when the majority of employees worked from home.
Here are a few ways businesses can set themselves up for post-pandemic growth:
· Determine the new normal: Businesses need to assess what their workforce set-up will look like as they progress into 2021 and further into the future. Will all employees be required to return to the office? Will working from home become the standard? Or will the company embrace a hybrid model? Expense policies need to fall in line with whichever scenario the company chooses. For example, in a hybrid work model, finance leaders need to determine what additional expenses employees need to operate efficiently both in the office and at home. If it hasn’t already been done, new expense categories that address home office expenses should be created in order to maximize visibility vs. allowing the miscellaneous category to become the dumping ground for new expense types.
· Optimize for anywhere-access: Cloud-based solutions offer easy anytime, anywhere access for all employees, regardless of where they’re working and which model the business decides to embrace. Employees can submit expenses via their mobile devices and managers can approve these expenses regardless of location. Streamlined workflows and access to the same, real-time data and applications can help increase efficiency, productivity, and accuracy – contributing to the company’s bottom line and growth goals.
· Increase auditing efficiency: As new types of expenses emerge and companies continue to grow, the use of artificial intelligence (AI) and machine learning (ML) technology can ease the burden of manual processes. AI/ML technology can help ensure the most important charges from expense reports are reviewed thoroughly. This frees the finance team to focus on more pressing business matters and ensures the compliance strategy is being applied consistently across the company.
The transition from office to work-from-home was a jarring change for both employees and businesses, and the ability to plan and make adjustments to help ensure costs stayed under control may not have happened at the beginning of the pandemic.
This time, as we foresee more changes ahead, businesses now have the opportunity to plan in advance and help ensure whatever transition they make, policies will be set in place, technology will help them run efficiently, and costs will be visible and compliant.
At SAP Concur, we are committed to reinventing expense and invoice management with tools that simplify everyday processes and create better experiences. As part of the larger SAP family, and through our experience, expertise, and partnerships, our solutions help every business run its very best.
Fok Wai Leng is Managing Director, Southeast Asia, at SAP Concur.