Travel Management
 min read

How Efficient Is Your Corporate Travel Expense Management?

October 4, 2022
Locomote team
Nick Sutherland
October 4, 2022
Locomote blog posts

When globalisation becomes a goal for a business, corporate travel also becomes more frequent. Employees must travel to meet with clients and partners and attend conferences or meetings. It's vital for any international business expansion!

Financial managers are responsible for finding ways to reduce corporate travel expenses and keep up with the company's financial health — which is quite a challenging undertaking.

Finance managers and CFOs have to have an effective corporate travel expense management (CTEM) system in place for two crucial purposes: to keep track of spending and avoid overspending. The last thing you want is for the company to lose money because of exorbitant travel expenses.

If you already have a robust travel expense management system, how do you know if it's working efficiently? There are many factors that finance managers have to take into account while trying to make CTEM more efficient. 

Here are six questions to help us evaluate the efficiency of our system:

Do You Have Real-time Visibility Into Travel Expenses?

If you can't track spending in real-time, you'll never be able to catch errors and discrepancies immediately; it’ll lead to delayed reporting and a lot of frustration for finance managers. You need to see where every penny is being spent as it's being spent!

Finance managers should have direct access to all travel booking and expense data to ensure real-time visibility. This data should be aggregated and easily accessible in one place. 

The finance team should also be able to set up alerts, so they're immediately notified when spending reaches a certain threshold.

Do Your Travellers Have Control and Autonomy?

If you don't have a corporate travel policy, your travellers will have difficulty knowing what they can and can't spend. This can lead to much frustration on their part and even cause overspending. 

Finance managers should work with their travellers to develop a corporate travel policy that takes into account the company's budget and spending goals.

Once the policy is in place, they should give their travellers the autonomy to book their own travel and expenses within the policy guidelines. This will help reduce the amount of time they spend managing travel expenses, and the travellers will feel more in control of their expenses.

Do Your Travellers Need To Pay Their Expenses up Front?

If your travellers need to pay their expenses up front, they're less likely to book within the company's budget. They may also be more likely to book with personal credit cards and attempt to get reimbursed later, which can create more work for finance managers.

Finance managers can consider implementing a corporate travel card program. This will allow travellers to book their travel and expenses on the company's dime, and finance can then track and manage all spending in one place. It’ll also help you take advantage of travel-related perks or rewards the company may offer!

Do Your Travellers Fill In Their Expense Reports?

If finance managers have to chase down travellers for their expense reports, the CTEM system isn’t efficient. Consider having travellers submit their expense reports electronically, so you have visibility into all expenses in real-time. This way, finance can approve or deny expenses quickly and easily!

Do you remember all those times you had to deal with paper expense reports or lost receipts? Your CTEM system needs to make it easy for travellers to fill in their expense reports and for finance managers to keep track of all of them.

How Long Does It Take Your Office Managers To Gather All Invoices?

If finance managers have to wait for weeks or even months to get their hands on all the invoices, something needs to change in the CTEM system. This only leads to frustration on finance's part and can also result in late payments to vendors.

Finance managers should have direct access to all invoices and be able to approve or deny them quickly and easily. This way, you can be on top of spending and ensure invoices are paid on time!

Do Your Travellers Need To Wait Long for Their Reimbursement?

Travellers should not have to wait long for their reimbursement

If finance managers take too long to process expense reports, it will only create more work for everyone involved. As a CFO or finance manager, you must be able to weed out out-of-policy expenses and personal expenses as well as detect fraudulent expense claims before processing expense reimbursements.

The best way to process corporate travel reimbursements quickly and efficiently is to use an automated CTEM system. Nobody wants to wait too long for their hard-earned money, so you should have a system that can accurately process expenses. 

You may also reward your travellers for their adherence to policy and on-time submissions by processing their reimbursements quickly!

Efficiency Is Key to Corporate Travel Expense Management

Think of everything a business traveller needs whenever they're on a business trip. You have airfares and baggage costs, accommodation, and transport fees. Most of the time, you must include car hires and associated costs like fuel and tolls — and don't forget the food, too!

It's no surprise how easily these expenses can add up. Before you know it, you've overspent our corporate travel budget for the month. This is what happens when you don't have an efficient CTEM system in place.

Travelling for business can be really expensive. After all, it's an investment you make to further our company's goals! 

Just like any project, you want to see a return on that investment. That's why finance managers need to be on top of corporate travel expenses and ensure that the company gets the most bang for its buck.

CTEM ensures that all your business travels are accounted for, and you have visibility into all expenses. If it's not managed efficiently, it can quickly become a massive liability for the company. 

It's high time to evaluate if your CTEM system is as efficient as it could be!