business spend management guide

Executive summary

In the face of global economic conditions and the rising cost of doing business, financial wellness has become the top priority for most organisations.

Finance departments must control spending across the organisation and have visibility into what types generate the most ROI. Without insightful analytics, improving forecasting and budgeting is complicated—if not impossible—because disconnected or low-quality data prevents teams from gaining a holistic view of spending across the enterprise.

Companies that use comprehensive data and analytics get a more holistic, accurate, and real-time picture of enterprise spending, which gives them the power to increase financial efficiency. Here’s what thought leaders say about the challenge and business impact of leveraging analytics to control spending and improve operations.

When market forces and business priorities impact financial efficiency

Achieving financial wellness in the current market depends on improved spending visibility, insightful analytics, and efficiency through automation. “Current market” is a key term here.

Companies today face economic and human capital pressure from inflation and hiring freezes while navigating pressure from investors prioritising profit over growth. All of these forces impact finance’s ability to operate efficiently.

As the cost of doing business continues to increase, many enterprise and mid-market companies are looking to their spend management systems to help them effectively balance costs and ongoing growth.

Finance teams may not necessarily be looking to cut T&E costs, as these expenses are often a result of business growth—which investors want to see. But they do need to control costs. According to a recent Emburse study, finance leaders overwhelmingly cited an intent to manage their spending more carefully rather than cutting headcount in response to market forces.

About half (44%) said they will increase spending visibility and analysis to improve their organisation’s financial wellness. To do so, finance teams need access to spending data and insights. These insights enable them to identify spending trends that signal where to pull back on investments and where to double down.

Any company that is expecting growth needs to automate AP processes.

Dan Sangeorge

Cost Accounting Manager

ALKU

The problem of budgeting and planning without analytics

In our recent survey, finance leaders said “financial reporting” was the number one process they started automating in 2022 and intend to automate further in 2023. Automation saves a lot of time, but applying analytics to reporting is where real efficiency gains are made.

The problem many teams face when automating financial reporting is grappling with the amount of data that needs to be processed and analyzed. Most companies have basic reporting capabilities that show the total amount spent on various expenses like travel and entertainment, usually obtained from ERP systems or corporate cards. But this basic reporting only begins to scratch the surface. These systems aren’t comprehensive enough to inform finance teams why spending patterns have changed.

For instance, a £5 cup of coffee could contain 20 different data fields relevant to human capital, such as information about the employee, their team, the approving manager, and HQ. It might also have 20 fields relevant to the T&E policy, like the order, coffee company, location, and card used.

A coffee with 40 different data points illustrates why an accurate overview of an organisation’s spending data is so difficult. The sheer volume and granular nature of T&E data complicate finance’s ability to close the books efficiently and make any sense of the data without in-depth analytics.

After all, financial wellness doesn’t just revolve around the cash an organisation spends. It also encompasses the power to understand the reasons behind spending and what dollars drive real ROI for the business.

Mid-market HR firm uses analytics to capture £360K+ in spending

With over 700 field employees, the magnitude of expenses (and all the processing that entailed) quickly outweighed International Services, Inc.’s (ISI) ability to process and report on key metrics. Even with massive amounts of time spent on reporting, the process still didn’t go deep enough—and ISI found itself unable to quantify the value of T&E management.

ISI initially selected Emburse Professional to improve the accuracy and timeliness of its expense submissions. Finance, though, could have been improved by the volume and depth of custom reports required by the organisation. Every week, senior expense administrator, Athena Gazikas, spent hours pulling together data from various sources to report on the business’s financial health and provide strategic guidance. The manual, Excel-based process was tedious. She often couldn’t accurately report on critical metrics like weekly spending.

Gazikas recognised the value of using T&E data to optimise spending and improve compliance. Still, ISI didn’t initially consider an analytics solution because her team only needed a few specific reports. When it decided to add Emburse Analytics, ISI immediately started to uncover savings in multiple areas while helping its teams simplify the reporting process.

Before adding Emburse Analytics, ISI was manually recovering an average of £216K in annual spending and couldn’t put a value on its time. Now it’s capturing £360K in annual spending and processing reports up to 300% faster and more accurately than before.

ISI ultimately reported £1.4M in annual savings after switching to Emburse solutions.

Not only does Emburse help us recover significant savings and work more efficiently, but it enables us to quantify the value of our expense management solution. So much value can be extracted from the data. The preferred vendor’s report and dashboard illuminate out-of-channel leakage and what that costs the business, and the audit dashboard helps identify big spenders and areas that need policy revision to increase spend control.

Athena Gazikas

Senior Expense Administrator

International Services, Inc.

Poor data quality leads to low spending visibility

Plenty of financial analytics tools can break down a 10% increase in spending by division, department, employee, or acquired company. But getting insights from the data becomes complicated as the company scales. Having employees in various states or countries, a mix of new and legacy hires, and different spending policies based on department and job function based on department and job function means enterprise and mid-market companies must juggle various AP and T&E policies. Without a system to centralise spending data, revealing the reasons behind a 10% spending increase takes a ton of legwork.

Why? Finance teams pull data from various sources (such as the ERP and CRM) into spreadsheets for analysis. These sources all carry unique data standards, meaning finance teams must standardise and refine the data before they can analyse it. With 50% of organisations still using Excel to manage expenses, many finance teams struggle with these kinds of data quality problems.

It’s a lot of extra operational effort to manage these disconnected systems. Yet, the real issue is the data quality and spending visibility issues they create. Forced to work with insufficient or overly complicated data, finance teams can’t make informed decisions about the policy updates or personnel changes needed to improve the organisation’s financial health.

Finance leaders must take full advantage of their spend management platform’s analytics capabilities. By implementing analytics within their existing accounting and T&E solutions, they can create huge leaps in efficiency, where the system automatically consolidates spending data. Not only will finance teams eliminate the time spent capturing, attributing, and processing spending data, but they’ll also extend the power of the whole AP software suite.

AI-powered analytics + spend management = efficiency, multiplied

Every finance department has the same goal: improve the organisation’s financial wellness. But the game has changed, and managing and interpreting raw spending data at the scale modern enterprises need is no longer humanly possible. Finance teams must shift the analysis burden to AI and machine learning (ML) neural networks, starting with their highestvolume spending categories.

AI and ML algorithms reveal spending patterns in raw data that humans would miss (or take days to uncover). This includes ever-critical financial inefficiencies, such as inflated mileage claims, duplicate vendor payments, unconsolidated software subscriptions, late fees on invoices, or approved out-of-policy expense claims. And that’s just the starting point for AI-powered analysis. The more raw data fed to a neural network, the better it performs and improves finance’s ability to make intelligent spending decisions.

Emburse is three times more cost-effective than Concur, and we’ve reduced monthly transactional spend by about 70% since switching.

Dawn Conway

BELFOR

What are other ways finance leaders’ daily work becomes more impactful when they apply analytics to their spend management platforms?

• They get critical insights that identify problem areas across AP and T&E that affect financial wellness
• They have unified data sources that distill information quickly and easily, giving them a more comprehensive view of spending across the organisation
• They can make more educated investment decisions with better-balanced spending and budgets
• They can use improved spending visibility to make data-driven decisions
• They have the power to reduce overall operating costs
• They can cut back on manual work and focus on more strategic functions

The major saving from Emburse is in time spent by the user, followed by the finance office who saves time on the creation of expense claims, processing, and reconciliation.

Thomas Toland

Director of Finance

Absolute Taste Ltd

How to start using data and analytics to uplevel financial efficiency

Implementing new data and analytics processes to maximise financial efficiency may sound daunting, but it isn’t. Take the following steps to get started:

1. Automate your transactions

Get all transactions, including expenses and AP, under management through automation. Capturing these transactions enables spending analysis. Plus, automation delivers major efficiency gains, as it helps employees operate more productively.

2. Streamline expenses

Use prepaid, virtual corporate cards to reduce the average time and cost of processing employee expenses. Prepaid cards also eliminate the need for expense reports and data reconciliation.

3. Maximise your payments

Capture rebates on card transactions to earn returns or reduce costs. You can also optimise payment timing—deciding whether to pay early to get discounts or pay later to conserve cash for upcoming invoices. Real-time cash management makes a big difference during a downturn.

4. Apply analytics and intelligence

Run AI and ML-based analytics across the captured payments and transactions to policies that require more investment or cost reduction.

5. Schedule a spend optimisation assessment with Emburse:

Identify your organisation’s unique opportunities to reduce operational costs and formulate the steps you’ll need to take to achieve full spending visibility and control.

About Emburse

Emburse delivers innovative end-to-end travel and expense management solutions that solve for what’s next for forward-thinking organisations. Our suite of award-winning products is trusted by more than 12 million finance and travel leaders, and business professionals around the world. More than 20,000 organisations in 120 countries, from Global 2000 corporations and small-medium businesses to public sector agencies and nonprofits, count on us to manage business travel and employee expenses with ease.

Our highly automated, mobile-first solutions streamline business travel planning, booking, and management and eliminate manual, time-consuming expense submissions, approval, and reconciliation. We deliver efficiency and time savings, increase financial visibility, enhance spend control and compliance, and improve the entire business travel experience. This empowers our customers and their teams to deliver meaningful value for their organisations.

For more information visit emburse.com/uk, or follow our social channels at @emburse.