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SMBs Drive Growth And Innovation When They Embrace The Full Power of T&E Solutions - A Forrester Spotlight

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This report is a Forrester Spotlight version of the "Financial leaders must embrace strategic T&E solutions" focusing on SMBs. It breaks out the SMB specific information in the research data that underlies the larger report, and makes specific recommendations tailored to SMBs about the benefits of automated T&E solutions and how to get the most out of them.

Managing employee-generated travel expenses can be a challenge for many businesses. For small and medium-size businesses (SMBs), the challenge is not as much about tracking a high volume of expenses as it is finding the right tools and processes that will enable employees to be as productive and efficient as possible. This is a key challenge for financial leaders at SMB organizations as they make decisions about new technology investments and their effect on the business as a whole.

In April 2016, Concur commissioned Forrester Consulting to explore current activities and challenges around travel and expenses (T&E) for SMBs and evaluate how financial leaders in these organizations are responding to these challenges, from both a financial and strategic business perspective. To support this research, Forrester surveyed 247 financial decision-makers from SMB organizations in the US, Canada, the UK, France, Germany, China, Japan, India, Australia/New Zealand, and Mexico.

T&E Process Efficiency Is A Primary Challenge For SMBs

Digital technology has enabled consumers to make purchases and engage with businesses in new ways in their daily lives. Many consumers now expect the same level of digital capabilities and convenience from the T&E solutions and policies in their workplace. Spurred by these advancements in digital technology, changes in employees’ spending preferences have put greater pressure on SMB organizations to enable more effective T&E processes. Due to their smaller headcount, SMB organizations see fewer challenges regarding business silos or control issues. However, they see greater challenges with T&E processes including:

› A high number of inaccuracies caused by the human element of paper-based processes. A lack of digital capabilities or automation increases the chance for human error in the T&E process.

› Large time requirements for paperwork and approval. Time is precious to employees, especially within small organizations where they are required to wear many hats. A lack of streamlined processes forces employees to spend extra time managing expenses, which is valuable time that could be spent elsewhere.

› A lack of mobile connectivity. Companies need to embrace the technology that employees are using in their everyday lives (i.e., smartphones and tablets) in order to make T&E processes more accessible and convenient. This is especially important as employees are traveling and don’t have immediate access to office resources.

FINANCIAL LEADERS NEED AN EASIER WAY TO MANAGE EXPENSES

Financial leaders in SMB organizations are very aware of the current challenges and concerns with T&E solutions. In fact, managing expenses was the single most challenging responsibility cited by financial decision-makers in our survey, with 56% of respondents identifying it among their top three challenges. However, as mentioned earlier, financial leaders within these organizations often carry more strategic responsibility overall. This means they must distribute their time to an increasing number of business priorities and have less time to manage finances only, specifically expenses.

With limited bandwidth, SMB financial leaders recognize the need to improve the overall T&E process in order to enable employees to track expenses more efficiently. These process improvements will give employees more confidence and reduce their frustration in tracking expenses, which creates a win-win situation for both employees and financial leaders.

SMBs Focus On Improving T&E Processes

We found that as financial leaders look to address the challenges with their current T&E processes, SMB companies have a different primary focus than enterprise-size organizations. The survey results highlighted two areas of significant difference based on company size:

SMBs view improved process efficiency as the No. 1 benefit of T&E solutions.

Enterprise organizations see more accurate reporting through data consolidation as the top benefit of T&E solutions.

 

SMB organizations are intently focused on making T&E processes as seamless as possible and are less concerned initially with better data consolidation. SMB organizations have far fewer employees to manage or business departments to reconcile, so it makes sense that their attention is focused on process improvements to eliminate inefficiencies of paper-based processes. As a result, 67% of SMBs surveyed are in the process of updating or are planning to update their T&E system within the next six months.

Picking The Right T&E Solution

Knowing that companies are looking to invest in new T&E solutions, we asked them about the importance of two primary facets of these solutions: 1) user friendliness and 2) business readiness, or the ability to easily integrate into existing business infrastructure and processes. For SMB organizations, user friendliness was the top priority at 41%. However, it was closely followed by 37% of respondents who said it was equally important to be user friendly and business ready.. Balancing user friendliness and business readiness is important when considering T&E solutions. As one interviewed CFO explained: “It has to be a mix of several factors. No single factor is big enough to bring strategic change in the organization. If you could eliminate the paperwork, get everything online or cloud based, get departmentalized statistics, and drive compliance, then any organization would be tempted to look into the adoptability of the new [T&E] solution/technology.” This highlights that while SMBs are primarily focused on improving the process for users, the technology behind these new processes must also integrate well with existing business ecosystems.