Choosing an expense management software is an important decision for businesses. Expense management is a broad term that refers to the system an organization uses for processing, paying & checking up on, and auditing expenses from employees.
Travel and entertainment are two broad areas that are most commonly managed through the use of expense management software. The term expense management is also used not only to describe the technology and software system. It is also used to manage employee expenses, but it also often refers to the rules and policies surrounding how employees can spend, and how they are to track and manage their expenses.
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The use of software to manage these areas of business is becoming increasingly popular. There is software that allows employees to manage their expenses, get authorization for certain expenses and be repaid in an automated and streamlined way.
Most expense management platforms have two different areas of focus within the same platform. First, these software solutions include the areas where an employee goes to submit an expense claim. Then on the other side, there is the area of the platform where the finance or accounting team goes to process claims and manage aspects of these transactions.
Prior to the widespread implementation of expense management software solutions, most companies had to rely on paper-based systems for tracking, managing and reimbursing employee expenses. This could include employees filling out paper expense reports, submitting them and in some cases waiting weeks or months for reimbursements.
Points to keep in mind while selecting expense management software:
1. Pain Points and Future Objectives
In most ways, the process for choosing expense management technology is no different from the steps you’ll likely go through to select any other new business technology. There needs to be a defined reason for choosing to use a technology solution. Along with that, specific pain points should be outlined so that the product selected can address those.
It’s also a good idea for businesses to determine future objectives and metrics they’d like to achieve through the implementation of the software.
With expense platforms, pain points might include non-compliance to current policies, long reimbursement wait times, or too many costly human errors.
When you know what your current problems are, and also what you want to achieve, it helps you sift through products faster and narrow your list to choose products that offer the features you need most.
2. Set-Up and Implementation
When you’re introducing any new type of technology or automated solution to your employees, you need to think about what it’s going to be like to set it up, configure and implement it. You want this to go smoothly and quickly.
Ask these questions,
- Think about the current expense management processes and tools you’re using. How will a new product fit into or integrate with those solutions?
- How user-friendly is the software?
- How comfortable are your employees going to be using it?
- Will employees need extensive training to begin using it or will it be something that can be implemented fairly quickly and easily?
- Are your employees going to initially be resistant?
These are all questions to ask and to think about when you’re choosing a platform.
3. Mobile Capabilities
Many of the tips on this list could be standard when selecting any new software product, not just solutions for expense management. However, mobile capabilities are extremely relevant to expense solutions in particular.
One of the biggest benefits of a modern software solution for managing expenses is the fact that it makes things easier for employees. It helps employees avoid wondering what the policies are and waiting forever for reimbursements and approvals. It can also make it much easier to manage expenses on-the-go.
These should all be top priorities when choosing a new product. For example, are there mobile features that will allow employees to track their expenses and keep up with their receipts on their smartphone? Can this eliminate the need to keep their receipts? Will this cut down on time spent by employees creating and submitting expense reports? Are there mobile solutions that will improve employee satisfaction with the travel experience and expense management in general? Will employees be freed up to focus on more strategic tasks with the mobile features available?
Other things to think about include how the mobile elements of the product may be different or not different at all from the native version. Are your employees going to have to download an app or multiple apps to use the product, and if so, how might this affect their experience? Is the end-user experience going to differ based on the device being used?
4. International Considerations
Something else specific to expense software is how it’s going to work on an international basis. Most businesses that require expense solutions have employees who travel abroad, and they may even have entire offices abroad.
Questions to think about include how many currencies the software can handle. This will include not only in terms of submitting receipts but also reimbursements that need to occur in multiple currencies. What about international tax, regulatory rules, and compliance? If an employee is submitting expenses and being reimbursed somewhere around the world other than their home country or the home country of their business, there are going to be local tax compliance issues, for example. Are all of these things going to be automated and built into the platform? If not, it may not be the right solution.
Finally, the budget is also going to be something to think about when choosing any new kind of software. Most businesses in the modern era find it’s best to go with a SaaS platform rather than on-premise one. That way, they have more flexible payment options and they can scale-up as needed.
SaaS is going to mean deployment times are faster and easier, and there’s no need for involvement from the IT department. Otherwise, with on-premise expense management, a business is also going to have to consider the costs and time required for setup and the involvement of the IT department.