Given the rise of globalization, companies are under continuous pressure to improve compliance to Travel and Entertainment (T&E) policies, reduce costs and enhance process efficiencies. T&E expenses account for approximately 8% to 10% a significant portion of total operating expenses (ranging from $50,000 to more than $100 million a year).

This report focuses on the challenges companies face in efficiently managing this expense category as well as the benefits of automation. Survey respondents from 296 companies gave insight into successful strategies and best practices that they have implemented.

The biggest challenge currently facing finance executives and travel managers is the lack of compliance with T&E policies. On average, approximately 20% of T&E spend is out of policy. In some cases, executives were surprised to find that company T&E policies were regarded more as "guidelines" that employees inconsistently adhered to or outright ignored. Therefore, being preventative, rather than detective, in enforcing policy is a critical step forward.

"Forty-five percent of respondents reported that the adoption of technology to improve visibility into T&E spending is a priority and similarly 34% to improve expense tracking and reconciliation," stated Vishal Patel, Research Analyst. Aberdeen also found that automated/online expense reporting can cut processing costs by $12 per report and can reduce booking transaction costs by $15 each, resulting in significant savings.

Key findings of the study include the significant interest in an end-to-end T&E solution that incorporates both travel-booking/planning and expense management. This includes everything from pre-trip approvals to reimbursement/card payment services and expense auditing. Currently, 19% of those companies studied reported using an integrated system, with an additional 26% planning to adopt such a solution by 2008. Also, expense management solutions showed considerable growth, 18% of companies studied plan to adopt automation in addition to the approximately 43% of companies currently using automation.

A complimentary copy of this report is made available due to: Concur Technologies, ExpensAble, Gelco and Visa International.

Related Link: Aberdeen Group's "T&E Expense Management Report"