You’ve already cut costs.

Now what?

1

CHAPTERS

Introduction

Controlling costs

Avoiding costs

There’s a better way

Summary and next steps

01If you’re like most businesses who’ve weathered the recession, you’ve

already cut costs.

Even before 2012, when 78% of small business owners identified rising

costs as the most significant threat to their company1, you’re likely to have

been closely managing your cash flows and making savings.

You might feel you have exhausted the possibilities for managing costs

and driving significant savings, and be concerned that more aggressive

cost reductions would endanger the long-term success of your business.

You wouldn’t be alone.

As budgets have become tighter and tighter, the pressures on finance

teams to find cost-savings that fortify, not hinder, the long-term success of

the business have built to a climax. So what are the smart next steps to cut

costs even further?

Introduction

“Today’s businesses are under constant pressure to reduce costs yet many find it hard to do so in a sustainable fashion.”

KPMG, Rethinking Cost Structures, Creating a sustainable cost advantage

3

THE ANSWER LIES HIDDEN IN PLAIN SIGHT: YOUR COMPANY’S APPROACH TO EXPENSES.

One business cost that is frequently overlooked is the category of

employee travel and entertainment (T&E) expenses. In most organisations,

T&E costs are the second highest controllable annual expense2 — only

salaries and benefits are higher. However, as many businesses are still

manually processing their expenses, it’s often not possible to get the

visibility and control you need to carefully manage this large cost.

Striving for greater efficiency and creative ways of doing more with

less money has become as much a way of life for Finance Directors

as balancing the books. And it is essential to keep an eye on costs

and controlling them, rather than being controlled by them. So it is not

surprising that companies who take control of their T&E spending can use

it to gain business advantages.

Alex Clemence, a Concur customer who automated his T&E expenses

process tells the story well: “We have enhanced our processes as we’ve

grown,” says Alex, “but sometimes it’s difficult to evolve efficiently and

dynamically. Historically payroll, expenses and expense management had

been very spreadsheet-based, with manual workflows, printouts, email

approval and limited management information available at the end3. Now...

we’re building up a database with which we can analyse the management

information and seek efficiencies within the business.”

Read on, as we guide you through a new way of thinking about cost-

savings, and dig into opportunities you might not have considered or

implemented – yet.

“Concur estimates that in 2012, UK organisations paid out over £8.2 billion in employee expenses.”

Concur, Employee Expenses Benchmark Report 2013 Executive Summary

02 Controlling costs

Cost-savings: questions to ask yourself

It’s time to get smarter about cost-savings. But before you commit

to a change, consider this alternative way of thinking about

employee expenses…

There is a different between processing expenses and managing

them. Savvy businesses know that business is more effective if

employees are as productive as possible. But the manual way of

processing expenses on printed bits of paper or spreadsheets is

labour intensive and limits how much you can control spending. On

the other hand, managing expenses using an automated solution

gives you control, and frees up time to let your finance team do what

really matters to your business, for its continued success.

02

5

Are you processing your T&E expenses or managing them?

Here are some questions to ask yourself:

• Would your finance team be able to make a bigger impact on the business if

they spent more time on high-priority projects and less time reviewing and

approving expenses, calculating VAT reclaim, processing reimbursements,

entering expenses in your accounting system, and chasing employees to fix

their claims?

• Could you control your T&E expenses better if you had information at

your fingertips about where and how your employees are spending the

company’s money?

• Would you like to be able to see where employees are planning to travel,

and how, to manage it before it even happens?

• Would being able to compare your T&E spending with other companies help

you set and adjust your T&E policy?

• Could you reclaim more of the VAT to which your company is entitled?

• Wouldn’t your employees be more productive and more likely to stay within

your policy if they could record their expenses on the move, using their

mobile phone?

If the answer to any of these questions is yes, it’s time to consider automating

your expenses so you can manage them rather than just process them.

“When calculating the potential return on investment for new technology, it’s important to consider the financial costs of doing nothing.”

Concur, 5 Reasons Businesses Don’t Automate Their Expenses

6

Things to stop doing

Expenses are expensive. Realise how much they really cost - in both time

and money - so you control them, rather than letting them control you.

“Failure to control costs can place serious strain on your cash flow… You

could also be throwing away money you could instead use to develop your

business4.” For example, cutting your expenses by say, 15%, might free up

enough cash to employ an additional salesperson which might, in turn, let

you grow your sales by 15%. It’s a virtuous cycle.

But some expenses are a necessary part of doing business. Face to face

meetings, for example, can be cut back on – but this might not be a good

idea. According to research by Concur, 86% of sales executives in the UK

believe that increasing the number of business trips to meet with potential

new customers would allow them to increase their sales5.

But how can you tell whether business trips actually do bring in the

sales? Over a third (41%) of those polled in the same survey did not keep

a complete record of the impact their trips have on driving sales, so they

have no way of knowing.

Stop putting data in silos

One easy way to track and then analyse travel and expenses costs is

by moving away from a paper- or spreadsheet-based system (where the

details of expenses live separately from other reporting systems) and

putting all the data into a single, automated system. For example, if you

could tell whether some industry sectors seemed to close just as well if

your reps had face-to-face meetings, or if they just exchanged phone calls

and remote demos, it might make you re-think how you do business with

these groups.

“Over 9% of the average UK-based company’s overall budget is tied to travel and entertainment expenses.”

Aberdeen Group, A Travel and Expense Management Guide for UK businesses

7

Seamless integration – for real business insight

You’ve likely already implemented automated tools like Enterprise

Resource Planning (ERP) or Customer Relationship Management (CRM)

software, such as Salesforce. Automated expense management solutions

can be integrated with those tools –so you can combine the data to

demonstrate the real cost of expenses for each business opportunity. The

result is real business insight with less effort.

Combining the right data, and being able to report on it, gives your

business knowledge that can be used to generate insights about how you

do business, and where you can do it more efficiently.

Picture this scenario: if you can analyse your expenses spend down to the

level of each expense category – and see who your top spenders are and

where they’re spending money – you can consider whether to re-focus

some of your sales efforts in different territories. Or you could keep a

closer eye on the expenses of those individuals who are pushing the limits.

“The automation of T&E expense management can enable organisations to reduce their expense processing costs by 50%-to-60%”

Aberdeen Group, A Travel and Expense Management Guide for UK businesses, November 2012

Avoiding costs

Saving money. It’s about more than just reducing current costs: it’s about

finding solutions to prevent future spending – otherwise known as ‘cost

avoidance’. That’s when the real benefits start.

Cost avoidance defined

Cost avoidance is defined as “action taken to reduce future costs, such

as replacing parts before they fail and cause damage to other parts. Cost

avoidance may incur higher (or additional) costs in the short run but the

final or life cycle cost would be lower.”

03

03

9

Business is good. Make it even better.

Avoiding future costs is a good business strategy. Since it looks like we’re

finally coming to the end of the recession – Deloitte says that as the

economic forecast improves, “business optimism among small enterprises

has hit a 25-year high”6.

Now is the time to invest in solutions that will build a basis for future

business growth.

Research by KPMG suggests that there is “a massive opportunity for

those organisations that are able to significantly raise the cost efficiency

bar by examining more strategic options for cost-cutting, fundamentally

changing their business and organisational models, and instilling a cost-

conscious culture throughout their workforce”7.The key to gaining this

kind of insight is by reporting on how much you’re currently spending on

everything – both fixed and variable costs, and using the insight gathered

to drive future spending.

This insight cannot be gained by interrogating spreadsheets – at least, not

without hours and hours of dedicated analysis and brain-power.

The benefits of knowing what you’re spending, where you’re spending it,

and then assessing how you can reduce that spend are clear. “Research

by Yorkshire and Clydesdale Banks showed that, in 2012 SMEs which

regularly reviewed their regular costs saved, on average, £11,385.8”

“Research by Yorkshire and Clydesdale Banks showed that, in 2012 SMEs which regularly reviewed their regular costs saved, on average, £11,385.”

Unum, The Practical Guide to Cutting Small Business Costs

10

Top tips for avoiding costs:

Time is money• When it comes to expenses, it’s not only the items themselves that are

a cost to your business. The human resource in the back office who

processes them is also a cost. Why not automate, and let them take on

other projects in the business instead? You don’t have to employ more

resources to process all those receipts. You can control costs and

improve productivity simply by automating the expenses process. But

automating your expenses means doing more than putting intelligent

calculations into Excel; it means taking out a whole layer of processing

– which actually makes life easier.

Let the system pull the data on your spend• Get the data and insight you need to understand your costs so you can

control your spend, moving forward. If the data is all in a single system,

it’s possible to get reports run automatically, scheduled in advance,

sent to the relevant inboxes of the people who need to know. There’s

no need to run monthly reports by hand – simply the human eyes to

assess them. More on this later…

Get your VAT reclaim right• How much VAT are you paying to the tax man unnecessarily? Do you

know? If you did, the chances are that you’d be able to claim more

of it. Companies who combine automated expense management

systems with VAT refund solutions are recovering huge amounts

of VAT on travel and entertainment expenses each year. And those

who use automated expense solutions secured receipts for 95% of

their reclaimable VAT9! Some expense management solutions can

guarantee that your expenses are compliant with HMRC requirements

too, so you don’t have to worry about costly HMRC audits. The result:

an efficient and risk-free VAT reclaim process.

“By reclaiming VAT on our travel expenses we have managed to save approximately 20% of our total European travel spend.’’

Cris Rocchio, Director of Finance, AMCI Global, VATit and Concur customer

11

Communicate clearly and efficiently• If you already have an expenses policy, make sure everyone knows

what’s in it. Clearly communicating the contents of the policy helps you

avoid unexpected bills. It’s also advisable to clearly communicate with

managers about what should or shouldn’t be approved, too, and how

long they should take to approve expenses10.

Compare yourself with other businesses• New innovations in travel and entertainment expenses not only

provide full visibility of the entire cost of a business trip. With TripLink

from Concur, you can actually see the comparisons to show how you

stack up against your peers11. You can then use this price-to-beat to

incentivise employees to save money for the company – or even reap

the rewards themselves!

Don’t re-invent the wheel• Just because you’re new and innovative in your space, doesn’t mean

you need to re-invent the wheel. Rely on others who’ve done things

before. The same applies to implementing a new system. A lot of

software companies think that the easiest or best way to do their

expenses in an automated way is to build a system to do it for them.

And many of them have come to Concur precisely because they know

that the secret of success is in focusing on what you do really well,

and relying on experts to do the things that can distract you from your

key goals. Outsourcing expenses to Concur is like having a whole

team of expenses, tax, HMRC compliance experts and auditors at your

disposal, without employing them yourself, or costing you a fortune.

When it comes to preventing costs, automation is key. It’s the very

definition of cost-avoidance and future-proofing: spending now, to save

(much more) later.

“When it comes to preventing costs, automation is key. It’s the very definition of cost-avoidance and future-proofing: spending now, to save (much more) later.”

There is a better way04Why an automated expense management solution is better

You get faster, more productive processes using a mobile app.• With a mobile app, your employees can do their expenses in minutes,

not hours. Using a smartphone, they can take pictures of receipts and

automatically create expense claims (and throw the receipts away, but

check with your local tax office first). Managers can approve payments

from their mobile phones without hassle. The result: finance teams can

check claims easily, and employees can be paid more quickly.

“We’ve seen real, tangible benefits from implementing Concur and we’re very, very pleased with the system.”

Garry Cook, Group Accounting Director, Gamma Ltd

13

You get better data visibility – which means better business decisions.

• To quote a popular management saying: “if you can’t measure it, you

can’t manage it.” An automated solution lets senior management see

exactly who’s claiming what, when, making it easier to monitor spend

levels and trends across the business.

The tax man will be happy.• HMRC likes processes, guidelines and receipts. An automated process

gives them confidence that you’re keeping track of employees’

expenses and complying with the rules.

You can improve productivity and employee morale. • Think how your business would change if each of your sales

employees spent 4-5 hours12 more every month generating results.

Keeping them focused on business, and not doing their expenses,

makes good business sense. They get more time back in their day,

and can follow an audit trail to see when they will be paid. The result:

happier employees, and improved productivity.

With fewer errors you have less frustrated employees and finance teams.

• Expense claims are automatically created based on a travel itinerary,

so employees don’t need to manually type in information. With more

accurate information in your systems you get less human error, and

a finance team who doesn’t have to query indecipherable claims as

often. The result: happier finance teams, less hassle for everyone.

Cloud solutions make your business more efficient. • The automation of T&E expense management can enable

organisations to reduce their expense processing costs by 50-60%13

and cut processing times from 15 days down to 3 days14. Data lives

on the cloud, so it’s stored securely and easily accessible. The result:

lower costs, faster processing times.

“Approvals can now be done very, very quickly; I can process 50 claims in half an hour, previously it took 20 minutes per claim.”

Nicole Kruggel, Accountant and Concur Administrator, Alfresco Software

14

You get insight into spend as it happens.   • Without having to wade through spreadsheets and do manual

calculations you can get instant reporting, as it happens, or

scheduled in bursts that appear in the relevant inboxes, as if

by magic. The result: accurate, timely data that informs smarter

decisions to run a better business.

CONCUR FURTHER BRINGS THE BENEFITS OF:• A salesforce connector (so you can analyse sales ROI through the

power of the cloud)

• Exhaustive understanding of what travel and expense policies should

contain, based on hundreds of UK SMB deployments

• Deep data warehouse for reporting – and we have a service that will

run reports for you so you don’t need any knowledge of how to create

your own reports.

Don’t wait to make your life easier. There’s a better way – which will keep

your employees, finance team, business leaders and the tax man happy –

all at the same time.

“If you don’t want to keep paper receipts, but want to free up your accounting team, make your whole payments process more efficient, and if you want your workers to do what they’re paid to do and not spend time filing expenses, then you should be looking at Concur. I could not give Concur a higher recommendation!”

Debbie Gormley, Financial Controller, Huddle

15

Investing in a cost-saving expenses solution: 7 helpful tips

When the time comes to consider investing in a new solution; remember

these seven helpful tips:

1. Put your employees at the heart of your solutions

Regardless of whether you see employees as your most valuable resource,

or a source of your greatest travel and expense costs, the fact remains that

a satisfied employee will be more productive. So give them the tools that

they need to make their job easier.

• For example, give employees travelling for business a mobile app that

lets them do their expenses on the move.

• There are solutions that allow managers to approve expenses while

out of the office too.

• Some expense automation apps can even read your receipt for you,

from a photograph, and automatically input the details themselves.

• Employees can even book flights and hotels from their mobile

phone, send their itineraries to an email address that pre-populates

their expense claim and have the data from their corporate cards

automatically populate their claim too.

2. Try new options

It’s good to evolve, to innovate, to change for the sake of business

improvement. A good place to start is to look at the technology you are

using and make sure you have the correct features for your business. For

example: think of the mobile phone. If you’ve got a fixed fee and go over

your minutes there could be a high penalty in it. Or purchase unlimited

minutes for £10 more a month. You end up saving money by thinking smart.

3. Keep your eyes on the prize – not the shiny object

Technology is evolving so fast. It’s sometimes hard to know which option

to choose. Even though there’s a new software tool available almost every

month, don’t go for the latest shiny object simply because it’s available, but

consider investing wisely in true time-saving software that will demonstrate

a long-term return on your investment, like CRM systems or expense

management solutions. For example, look at the current technology you

have to check that the solution you buy will add value to your existing

purchases. Expense management tools often integrate with other software

like Salesforce, Sage and QuickBooks.

16

4. Consider your current needs – and what you don’t need

Is the way you’re doing expenses today ‘good enough’? Is ‘good enough’

actually good enough? Or could it be better? Before Ford mass produced

the car, if they had asked their customers what they really wanted (not

what they ended up needing) they probably would have asked for a faster

horse. The same goes for expenses: for many companies, a spreadsheet is

“good enough” to manage your expenses. However, while expenses may

seem like a small part of your business, it’s actually one area that can have

an impact on many others. Don’t try and duplicate your manual expenses

processes in an automated system. It’s automated for a reason – because

it may be a different way, but more often than not: it’s a better way.

5. Weigh up the cheapest vs. best for your bank balance

Beware of false economy. Buying something that’s cheap but will fall

apart soon and simply need to be replaced – or something that is ‘good

enough’ but doesn’t have the ability to grow with your business may save

you pennies now, but the long-term cost in frustration (not to mention

replacement costs) could be far greater than you think. It’s the same with

expenses – it doesn’t pay to get a system that your employees hate using

so much that you end up replacing it in a year. User satisfaction is an

important part of choosing the right software.

6. Consider that time costs you money

Control your costs by putting systems in place that help you save more

than just money. Remember that both and time and money are costs to

your business. For example, when it comes to expenses – it’s not just the

money that your employees spend on taxis, meals or train tickets: there’s a

cost for the resources that process and analyse those expenses.

Automation is the norm. No-one does payroll without an automated system

these days. No-one should have to do expenses using a spreadsheet

either. Automating expenses makes life easier for employees who claim

expenses, and for the finance team. Automation generally frees up time

for overworked employees - and enables you to keep headcount constant

rather than increasing admin heads as your business grows.

7. Find your ‘good costs’

There’s such a thing as ‘good costs’. For example, the trip your Business

Development director takes to meet an existing client that wins you

new business is well worth the effort. The best way to get an in-depth

understanding of good costs is to link your sales activity with the

expenses, thereby demonstrating the ROI of sales travel.

05Summary

According to the Deloitte CFO Survey, “the top priority for CFOs in 2014

is expansion”6. But expansion requires investment – and investing in solid

infrastructure has, historically, been known to take time.

Interestingly, in 2012 CEOs identified technology – rather than market

forces – as the biggest driver of change for the first time17. This year,

CEOs again ranked technology first. Believing the impact of emerging

technologies on their organisations will be profound.

Summary and next steps

The answer lies in investing in the right technology – technology that might even cost a lot less and take less time to implement than you imagine.

Concur, 5 Reasons Businesses Don’t Automate Their Expenses… and why they should.

05

18

Future-proofing your expenses (spend now to save later)

“Nearly two thirds (63%) of the 400 UK companies surveyed for CompTIA’s Trends in the UK IT Industry study said they intend to invest in technology over the next 12 months to help them reduce costs and overhead; improve staff capability and productivity; find more effective ways to reach new customers; and address other business priorities.18”

There’s a better way to control the costs of employee travel and expenses now, and to predict (and restrict unnecessary) future spending by investing up-front. Control costs now and save money later by doing something that’s less difficult than you might have thought: automating your expenses.

The answer: invest in a cloud-based solution

It’s time to invest in business automation. There’s no better way than putting your expenses data in the hands of an expert and keep it easily accessible in the cloud. You won’t be alone.

Concur is a perfect way to harness the power of the cloud to reduce current expenses costs, avoid future unnecessary costs and have full visibility of employee expenses.

After all, managing expenses is about more than just balancing your budget. It’s about

• efficiency and cost control;

• knowing where your money is going,

• understanding what your employees are spending to bring in new business,

• and being able to identify where you could reduce costs.

All of which is fully visible with an automated solution.

It’s time to say goodbye to out-dated and painful manual ways of analysing your spend.

“For the majority of industries cloud offers access to better software, cheaper storage and better security than most companies would ever invest in.”

Graeme Gordon, Operations Director in Cost Control and the Cloud

19

There is a better way.

Most companies have automated their employee payroll process, yet

still use a manual one to manage the second largest controllable cost to

their business, namely: expenses. Why is this the case? If a cloud-based

automated solution is right for payroll, why is it not right for expenses? The

answer: it is.

While most people think spreadsheets are good enough for expense

claims, they’re not. We often wonder why 16% of senior finance leaders

are still using manual processes to do expenses, and 58% are using

spreadsheets, when there’s a better way15. But it’s like a lot of things

in business — too often our actions are defined by momentum, not by

conscious choices. We have a lot of processes that seem good enough,

but the truth is, they really aren’t and they cost us more than we might

think. Expenses are one huge example of that inaction. Business owners

spend more in this category than in any other, so it’s a priority to find a

better way to manage it.

Sure, you’ll be asked to improve the productivity of your employees. You

may be asked to cut costs. You’ll definitely be asked to help improve the

bottom line. And you’ll be expected to predict future costs and budgets.

But the one thing you are very unlikely to be asked to fix – expense

management – is one area of the company that can have a huge impact on

the others.

“Imagine a world where inputting, submitting, paying and analysing expenses is completely painless – a world that’s better for managers, senior executives, finance teams and expense claimants. It’s possible.”

Concur, Imagine if… there was a better way of doing expenses.

20

Take a test drive

You can see how easy it really is to do your expenses online. Go to

www.concur.co.uk/free-trial and get started now!

Why Concur?

Concur makes doing expenses less painful – for businesses and

employees. We’ve got a suite of really cool tools that live online, in the

cloud, to help employees get through the process painlessly; let finance

teams streamline processes and payment; and to give managers and

senior leaders full visibility of who’s spending what on expenses, where.

With no up-front fees, no extended tie-in and the closest thing to a plug-

and-play solution available on the market, Concur brings 20 years of

experience of automating expenses for companies of all sizes to a best-

practice, templated approach that can literally be up and running in days,

or even hours.

Talk to us

Call us on +44 1753 501 444. We’d love to chat.

Take a free trial Contact us Read case

studies

REFERENCES & HELPFUL RESOURCES1. http://clearbridge.co.uk/2012/01/small-business-ideas-cost-management-through-outsourcing/

2. http://en.wikipedia.org/wiki/Corporate_travel_management

3. Alex Clemence, Finance Director, Blue Chip Data Systems, https://www.concur.co.uk/casestudy/blue-chip

4. http://www.sage.co.uk/documents/guides/discover-guide-controlling-costs.pdf

5. https://www.concur.com/en-uk/media-resources/press-releases/05-01-13

6. http://www.deloitte.com/assets/Dcom-UnitedKingdom/Local%20Assets/Documents/Research/CFO%20Survey/uk-insights-cfo-survey-2013-q4-full-report.pdf

7. https://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/Documents/PDF/Advisory/cost-boomerang.pdf

8. http://www.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2013/10/21/ebook-the-practical-guide-to-cutting-small-business-costs.aspx

9. Concur, Employee Expenses Benchmark Report 2013 Executive Summary

10. https://www.concur.com/sites/default/files/a-best-practice-expenses-policy-template_concur_uk_2014.pdf

11. http://www.prnewswire.com/news-releases/new-concur-triplink-solutions-introduce-end-to-end-booking-visibility-and-control-for-corporate-customers-tmcs-218414411.html

12. E-Payables 2010, Aberdeen Group

13. E-Payables 2010, Aberdeen Group

14. Aberdeen Group, Expense Management: for a New Decade, 2011

15. Getting to grips with Expenses – Concur research by QuoCirca http://assets.concur.com/whitepaper/uk-quocirca-full-report.pdf

16. http://www.cloudpro.co.uk/saas/5750/cost-cutting-small-businesses-benefits-cloud-approach/page/0/1

17. http://public.dhe.ibm.com/common/ssi/ecm/en/gbe03579usen/GBE03579USEN.PDF

18. http://www.comptia.org/news/pressreleases/12-12-20/UK_Firms_Turn_to_Technology_for_Efficiencies_Cost_Containment_and_Customer_Acquisition_New_CompTIA_Study_Finds.aspx

About ConcurConcur is a leading provider of integrated travel and expense management solutions. Our adaptable cloud-based and mobile solutions help companies and their employees control costs and save time. Concur’s systems adapt to individual employee preferences and scale to meet the needs of companies from small to large. Learn more at www.concur.co.uk

©2014 Concur, all rights reserved. Concur is a registered trademark of Concur Technologies. All other company and product names are the property of their respective manufacturers. Specifications and other details listed are accurate as of printing, but may change without notice. WP WHAT NOW GLO 2014/03