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Businesses Believe in Cloud Expense Management, Few Use it

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A recent Forrester survey found that 69 percent of surveyed mid- to large-sized businesses view cloud-based expense management software as beneficial to cost reduction, believing such products could help reduce expenses by 20 percent or more, though few are using them.

The research found that only 50 percent of those surveyed are using any type of metrics, such as the accuracy and timeliness of expense filing and compliance with corporate expense policy, to measure elements of their expense management process. In addition, 37 percent of surveyed businesses currently use their ERP system to manage expenses, while 24 percent use spreadsheets, 16 percent use homegrown systems, and only eight percent use cloud expense management software.

Survey respondents also cited include poor integration between their expense management system and other business apps, poor data quality due to manual entry reducing reporting capabilities, and the inability to gain insight into and take advantage of expense management trends as their top issues.

In January 2013, American Express commissioned Forrester to evaluate the expectations that midmarket firms (those with 100 to 999 employees) and enterprises (those with 1,000 or more employees) have for their expense management software. Forrester also investigated the issues these businesses are currently struggling with and their interest level in adopting cloud expense management software combined with a corporate card program.

Forrester surveyed 216 decision-makers around the world with responsibility for expense management and conducted in-depth follow-up interviews with several executives. 

1 Comment

It may partially be a matter of terminology... purchasing management makes sense, expense management - maybe not so much.

When a business owner hears the term "expense management", they immediately get a vision of traveling employees with piles of receipts and vouchers to be organized, accounted, and possibly reimbursed for. The image is fleeting, gone out of mind with no lingering thought, because this business owner does not have personnel who travel frequently, and does not have to deal with volumes of expense reports from employees. Expense management solutions aren't anything this business owner is looking for.

Yet, what does happen every day is that equipment, materials, supplies, and services must be purchased to keep the business operation going. Calls are made to vendors, price quotes are developed, and purchase requests are typed up in Excel spreadsheets and piled on the owner's desk for approval. The business owner rifles through the various requests, and brings in the bookkeeper to help work through the decision of which items to authorize based on current cash availability. Because the availability of working capital changes frequently with billings being sent out and receipts being deposited daily, the owner and the bookkeeper spend much of their time together figuring out which purchases to make and when. It is a continual and ongoing process, taking a lot of time and attention away from other important business matters.

http://coopermann.com/2012/11/12/managing-the-purchasing-process-more-than-just-expenses/

Posted by: joaniecmann | September 3, 2013 1:49 PM

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