Finance and employees help to see the costs of business trips on an equal footing

By Jessica Staley.

There is a silent conflict going on in today’s organizations: financial leaders and employees are at odds. According to a 2022 survey, these groups have conflicting views on business travel and what is reasonable spending — and they’re costing their organizations money.

While 36% of business travelers said it was very likely their industry would see an increase in business travel before the end of 2022, finance managers were less confident – only 12% of them agreed with this assessment.

Additionally, in early 2022, only 16% of finance managers felt their organization was ready to handle an increase in business travel before the end of the year, compared to 39% of business travelers.

Regardless of sentiment in early 2022, recent data shows that business travel volumes are indeed increasing. However, many companies rely on fewer employees to handle the majority of business travel. Four in five global business travelers (82%) say their business is returning to pre-pandemic levels, but with a “more travel, less shoulders” approach. Additionally, three in five (61%) say their current travel plans are falling short of their expectations.

Finance managers and business travelers also bicker over expense policies and compliance. 98% of finance managers said they saw an increase in non-compliant spending in 2021. This aligns with business travelers, with 89% admitting to having submitted at least one expense report in the past year that may violate their company’s travel policy. And while 53% of finance managers attributed these non-compliant spends to unclear policies, nearly two-thirds (65%) of business travelers admitted questionable spends were submitted on purpose.

Non-compliant spending can impact a company’s finances, especially in today’s economy. The average value of non-compliant spend submitted by business travelers in 2021 was a whopping $3,397, according to our survey.

Reimbursement disputes are also rife: 86% of business travelers said their company had defaulted on at least one reimbursement for their business expenses in 2021 – and 89% said such delays are affecting their personal finances.

As travel volume increases, the needs of business travelers are more important than ever. 91% of business travelers worldwide say flexible travel and booking options are essential to protect their health and safety. However, 52% of US business travelers said their management could have better prepared for an increase in travel by giving them more flexibility and control.

So what can a company do to resolve these tensions?

  • Invest in solutions: Businesses need to evolve their compliance toolkit while keeping employees productive and happy. Fortunately, advances in technology offer solutions for all roles. Travelers can take advantage of real-time trip updates and booking apps, as well as tools for faster reimbursement and navigating security requirements. Finance can improve its audit processes through the use of AI-driven automation, resulting in 100% coverage. The threat that reimbursement requests will be reviewed is a great motivator for employees to do the right thing.
  • Update your policy specifically: Review your policy at least once a year and learn what’s working by interviewing your field reps directly. Is the policy easy to understand? What scenarios have you encountered that are not covered? Where were the pain points this year?
  • Reduce ambiguity: Make sure your policy considers the big picture—the reason certain rules exist. Clarify business expectations. Proactively address ambiguous scenarios and best practices to meet compliance. Who Pays for TSA Prior Inspection? How does the company handle private travel in addition to business travel? When an employee understands the rationale behind the policy, they tend to invest more in compliance.

Are travel and expense conflicts brewing in the background of your organization? By taking a few strategic steps—with a focus on policy refinement and thoughtful automation decisions—you can create a collaborative culture that helps your employees see eye to eye.

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Jessica Staley is VP of ISBN product success at SAP.

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