Employee satisfaction is important to every line of business, and every department plays a role in improving the employee experience. However, expense management is often forgotten. And this despite the fact that it can be seen as a sign of appreciation for employees and an organization’s willingness to care for their well-being. However, there are four ways companies can improve expense processes.
This is according to recent SAP Concur research into expense management and employee experiences. Many employees are worried about their personal finances, especially now that the cost of living in the Netherlands is skyrocketing. Because of these high costs and employee concerns, financial processes and compensation are increasingly viewed critically. Cost management has therefore never been more important to maintaining a good relationship between employers and employees, says SAP Concur.
Valued and supported
A simple expense process, fast reimbursement and up-to-date policies allow employees to feel valued and supported by their employer. Ineffective processes actually prevent employees from taking full advantage of expense reports, resulting in employees seeing themselves as unimportant.
Some employees also find complex expense processes daunting. They’re afraid of accidentally committing fraud, jeopardizing their job security by doing something wrong, or can’t afford to wait for a refund. The survey shows that almost half (48%) of Dutch employees worry that their managers will think badly of them if their expense reports are high. This suggests that some employees are hesitant to disclose all of their business expenses. Meanwhile, 54% fear they will get into trouble with their manager if they misreport their expenses.
SAP Concur identifies four steps finance and HR teams can follow to improve expense processes and policies to support their employees during these challenging times.
1. Leverage technology like AI and automation
The way many expense management policies are designed does not meet today’s challenges facing companies and employees. New or unfamiliar manual tasks for employees often cause uneasiness during expense processes.
Automation technologies can support efficient and simple processes. Organizations that already implement such technologies are reaping the benefits of improved employee experience and efficiency. This eases the pressure on the employee and increases employee satisfaction.
Employees agree – the SAP Concur survey shows that 51% of Dutch employees point to automating the expense process as the best way to simplify it. Digital tools are also on the rise, with 68% of finance and HR decision makers already using artificial intelligence to ensure payroll complies with government regulations. On top of that, 58% say digital tools help manage expenses in their organization more effectively. Without these digital tools, finance and HR teams will have to spend more time troubleshooting and manually and inefficiently checking compliance.
2. Ask employees for feedback on a regular basis
How companies respond to expense management challenges will either increase employee satisfaction and increase talent retention, or create a bottleneck in the employee-employer relationship. Talent will drop out because of this.
Employees deal with the expense process regularly, so business leaders need to understand how to improve it by asking their employees’ opinions. The survey shows that 90% of Dutch employees indicate that feedback initiatives to measure satisfaction are declining in their company, only 32% say it happens often.
Companies need to understand that initiating feedback is important to improving employee satisfaction, according to SAP Concur. It can help reduce workplace stress without direct financial support. Only by talking to employees can employers understand what training is relevant or what policies they can improve to make employees feel more confident about their spending.
3. Creatively robust spending policies that are fit for the future
Expense and invoice management systems have long had a reputation for being time-consuming and difficult to track, but it could be different.
The problem of inadequate and lengthy expense processes is exacerbated by the current economic situation and is frustrating for employees. At the same time, companies are eager to reduce inefficiencies and cut costs. There is an opportunity to do this while improving procedures and policies to support employees.
The expenditure policy must be clear and straightforward. The employee version should state all points clearly, cover the basics and not contain any legal or corporate jargon. It must also be accessible. The easier the policy is to understand and find, the easier it is for employees to follow and enforce. Employers should also be aware that the types of expenses and conditions have changed in recent years with trends such as working from home.
4. Ensure that managers communicate the policy transparently and openly
Technology such as AI and automation is essential, but must be combined with a culture of transparency and open communication. This improves relationships and allows employees to easily navigate the expense process. Finance and HR teams can then effectively manage the process.
All updates to the policy must be clearly communicated to all employees. Explaining the rationale behind policy changes and how those changes can benefit all employees helps with adoption and compliance. It is important that there is a policy that is followed, but also that everyone is held accountable – without exceptions, regardless of position and status – to keep it transparent for everyone.
The Expense Management in Times of Inflation: How to Improve the Employee Experience report is based on the opinions of 2,500 employees who regularly travel for work, as well as 750 financial decision makers and 750 HR decision makers in companies. The research was carried out in Belgium, France, Germany, Austria, Italy, the Netherlands, Scandinavia, Spain and the UK by Coleman Parkes in July and August 2022.