Since the earliest days of business travel, the recording and reconciling of expenses has been a hassle. Whether it was Genghis Khan and his Horde pillaging their way through Asia Minor, Hannibal crossing the Alps with elephants, or Jesus telling his disciples not to worry about what they were going to eat or wear on their mission, justifying travel expense has always generated great anxiety through the millennia.

Nowadays T&E is getting attention from an array of players – including some heavy hitters outside the travel space. But while technology continues to develop new tools to make tracking and reporting expenses easier, it seems not all solutions are ready for prime time. Indeed, there are still plenty of bottlenecks to gum up the works.

Travelers, for example, may be lackadaisical in following expense policy. Or equally likely, if users find the company’s newest proprietary T&E tech too complicated, it may be doomed to fail. Off-the-shelf software is not immune either. One-size-fits-all may not work for a company that has a global footprint with its many international variables.
Nevertheless, some companies have found ways to simplify expense reporting, resulting in greater efficiencies and better ROI from travel costs.

Tech to the Rescue
Corporations process an average 51,000 expense reports annually and a whopping 3,000 hours correcting them, according to a report from the Global Business Travel Association. At this scale, “the push to make expenses easier and more accurate by automating them makes the most sense,” says Duke Chung, co-founder and CEO of Travelbank, a San Francisco-based fintech company which was acquired by U.S. Bancorp in 2021. “Automation can translate to smoother, more streamlined finance operations. From setting your travel and expense policies, to ensuring employee compliance, automating these activities minimizes wasted time, money, and compliance risk throughout the process.”

Michael Sindicich, EVP, GM of Navan Expense, a division of Navan Inc., says “Real-time visibility enables companies to control spend and make adjustments to their budgets or to company policy dynamically – rather than it being a black box until the month or the quarter is over and finance teams have chased down employees to submit expense reports – enabling better forecasting and strategizing.” To prevent poor data visibility, Sindicich advises organizations to implement a modern expense management tool that allows them to monitor and control all company spend in “real-time, unearth spending trends, and provide actionable insights for effective financial management and strategic decision-making.”

According to Navan’s August 2023 survey of finance professionals, more than one-third of companies are still not automating expense management solutions, which means “they’re wasting valuable human resources on repetitive actions with a higher potential for error,” Sindicich notes. “Automation enhances efficiency and provides companies with a more accurate, real-time overview of expenses, leading to better financial control. It also frees up employees to focus on higher-level, strategic tasks, which can generate many creative new solutions.”

Nearly half of corporate travel and finance managers (49 percent) surveyed in The State of Corporate Travel and Expert 2023 Report from Navan and Skift, said they were concerned about change management challenges stemming from employee training issues, up from 43 percent in 2022. And 40 percent have hesitated due to potential costs, a number that was flat year-over-year.

Sindicich says that despite advancements and touted strengths of automated payment systems, companies are still navigating the transition from manual processes to digital solutions slowly. Some companies are holding back from adopting integrated solutions, he says, because of concerns such as “change management and distrust or lack of awareness around how smartcards can control spend proactively They don't want to give every employee a card.”

Most modern spend management requires companies to switch from their existing corporate card, “and they don’t want to due to change management or due to their existing bank relationship,” he adds.

“However, in the long run, hanging onto legacy solutions may end up costing a business more than switching to a modern solution,” Sindicich warns. Moreover, the benefits of adopting tech-forward expense management tools are clear and “the appetite from customers across all industries is growing stronger every year.” He says Navan has recorded a 90 percent year-over-year increase in the number of customers that include Expense services. “This change improves operational efficiency, increases visibility, saves time, and enforces policy controls, all while enhancing the overall user-experience so employees actually use the chosen tool.”

Virtual Solutions
Ralph Kaiser, president, CEO and chairman of the board at UATP, says their conversations between buyers and suppliers have focused on the expectation of wide-spread adoption of virtual card products. “These products can be expensive for suppliers so there needs to be a balance focused on ‘best value.’ Manual processes and inefficiencies have plagued corporate travel buyers.” He says technology has automated many of these manual processes.

“Acceptance is another key issue – there has to be acceptance by all vendors. The ability for greater spending controls and more insightful analysis of spending and spending patterns, along with a more secure transaction, are the primary drivers for the increased usage of virtual cards. UATP offers virtual and ghost cards and is a reliable partner for all things travel payment.”

At TravelBank, Chung says industry leaders should expect widespread adoption of virtual cards for travel expenses and that digital payment methods will enhance security and streamline transactions. “We have seen an ongoing trend among employees requesting more self-service and autonomy in workplace tools. The future is much more digital-first, next generation of business wanting to do these things themselves.” He says the appeal of digital payments are many: “On the go” equals a great mobile experience for employees and a desktop version offers the same for admins.

“A digital-first mindset is transforming the way people book and manage their travel arrangements,” Chung advises. “This mindset relates to Commercial Rewards, which was created by U.S. Bank and TravelBank to reduce manual processes and provide businesses with a single, intuitive platform to manage an entire travel and expense program.

With dynamic card controls and customizable travel policies, the Commercial Rewards Card can govern how much can be spent, by whom, where, and on what type of purchase to ensure policy adherence.” Chung goes on to explain that employees can take advantage of special TravelBank rates and waived booking fees to save money for their organizations, which in turn, employers can use to pass on through employee incentives. Furthermore, businesses can earn rebates “faster with lower spend thresholds than traditional commercial cards.”

Sindicich says virtual cards help streamline the entire expense process and are a beneficial component of any expense management platform. “They offer enhanced security, faster transactions and better compliance with spend policies, and can be easily created or deleted without the hassle of a physical card.” Businesses can leverage virtual cards' automated reconciliation and smart controls to “optimize expense management, empower employees to spend within proactive policy limits and streamline vendor relations.”

He says Navan embraces the innovation of virtual cards for travel expenses. “Our platform allows companies to issue an unlimited number of virtual cards globally. Each card is integrated with a given company’s granular policies and offers embedded control mechanisms, ensuring secure transactions that are aligned with business needs. Navan Expense prioritizes security and efficiency – virtual cards can be instantly frozen or canceled, mitigating the risks associated with physical card loss. Additionally, Navan automatically generates a new virtual card for each booking, tying the card to the specific merchant booked, adding even more security control.”

T&E Tech and Policy
Travel policy compliance is a nagging problem that demands satisfaction, and not just for T&E issues. Infractions can trigger serious consequences, especially when it comes to duty of care and security breaches which may open the door to unforeseen dangers and liability.

Jon Webster, global team member and consultant with Festive Road, advises there is much to consider. He offers five tips when considering the application of technology to policy enforcement:

•Contextual Communication: “Where and how you communicate policy really depends on what you do as a company and how you ‘do things round here.’ Don’t just assume that traditional e-mail broadcasts work. Should you update the intranet page to hit enough of the population? Or would an intuitive app resonate more with the latest generation entering the workforce? Getting it right for your culture is key.”

•Artificial Intelligence: “With the convergence of digital travel, expense and payment tools, now is the time to ask yourself if AI can really help you to deliver policy pop-ups or prompts on devices as employees travel, or prompt them before they pay for an expense.”

•Capturing Off-line Spend: “One should also consider data capture outside of the managed channel. As airlines and hotels in particular continue to increase the number of channels they distribute through and their appetite for direct sell increases, using technology to capture intelligence from direct booking and use of other websites is key.”

•Develop Policy to Fit the Technology: “Clear, non-interpretive guidance and communication is key to policy enforcement. It should ensure people are offered what’s needed and approved. It reduces maverick spend and saves the company money along the way. But it also needs to fit the ability of the technology it is being applied through. Otherwise, ambiguity is created, leaving the door open to confusion and opportunity.”

•Online Training and Enforcement: “Being clear on the consequences of non-compliance or slow submissions is also key. Don’t be surprised if challenges continue if consequences are low. Some companies use communications technology to deliver annual training to regularly reinforce the importance of policy, the responsibility of travelers and approving managers to drive compliance, and other benefits to the company. The training also reinforces the penalties for lack of compliance. Others request that employees e-sign a declaration that the policy has been reviewed and will be adhered to. Once signed, enforcement becomes much easier.”

Webster believes shifting company structures, evolving traveler demand, and a dynamic marketplace are changing the way industry players think about travel policy and how it should be applied. “In addition to the policy guidelines themselves, which considerably impact the likelihood of compliance, the technology used to manage the process and the communication points applied are going to be the things that have the most impact on enforcement.”

The benefits of implementing automation with expense reports are many, Chung says, including using the data to hone policy. “TravelBank allows you to create travel policy parameters as unique as your team, but also offers an out-of-the-box recommended policy so you can get started automating trip approvals in as little as a day, and customize as you go,” he says. “With automation, employees can simply capture expenses as they happen, let OCR technology fill in the details, and submit them as an expense report when they’re ready with one simple tap. When the employee submits their expense report, the manager receives notification so they know there is a report pending their review and approval. Automation saves time, minimizes human error, creates a better approval flow, and gets money back to your employees faster.”

Navan’s platform displays all company spend on a single dashboard and in real-time making it easy for companies to make financial and policy decisions that best serve the company. Recognizing the prevalence of manual expense reporting, in early 2023 Navan launched Ava, a generative AI-powered automated virtual assistant. “It can analyze T&E data and pinpoint opportunities for savings and optimization in a matter of seconds, 24/7/365 days a year. Ava’s capabilities enable rapid data analysis, surpassing the speed and accuracy of manual reporting,” Sindicich says.

“The ability to predict company spend patterns accurately helps finance teams minimize expense costs and non-compliance while boosting cash flow. Ultimately, that leads to more time and money saved.”