Sunil Gupta is a VP at a global FMCG company in India. He spends most of his work days on the road travelling to destinations around the world to meet customers, partners and investors. Sunil has got used to the frequent travel but dreads one aspect of it. He spends hours filing expense reports when he returns to office, as he needs to claim all his travel expenses. And he hates doing this and thinks it is a loss of productivity. After weeks of travel, he often finds it difficult to remember exact amounts spent on food, hotels, and transportation. By then, the bills and receipts on thermal wax paper have long faded. So Sunil has now lost interest in doing this cumbersome task and has stopped claiming his expenses. He knows it is a huge personal loss for him and also a compliance issue for his company. There are many others like Sunil who dread filing Travel & Expense reports. Some under report spending or guess the amounts and unknowingly inflate expenses. But there are apps like SAP Concur that have come to the rescue.
As businesses digitise processes, many are taking to Travel & Expense solutions to address this problem. The use of mobile devices and apps have also eased the burden of filing reports. Did you know that there are apps that track your expenses and can immediately send expense reports to your Finance department? You do not need to collect all those bills and spend hours preparing expense reports; the app does it immediately when you complete a payment transaction, provided the service providers and your organisation are on that platform.
According to IDC, the Travel & Expense (T&E) market reached $1.6 billion in 2015. It is projected to reach $2.5 billion by 2020.
IDC also notes that their market definition of T&E has evolved to provide travel, expense and invoice management services for a connected process for managing spend.
Significant developments in the industry have impacted demand, which has grown 8.8 percent since 2014.
Meet SAP Concur
SAP Concur, a leading T&E app, already has 54 percent of this market. In fact, over 70 percent of the Fortune 500 companies use SAP Concur. SAP acquired Concur Technologies for $8.3 billion in 2014. SAP Concur facilitates bookings, payments, tax rebate claims and expense reporting. It integrates travel, expense and invoice and it offers real-time visibility and tracking of expenses. The SAP Concur ecosystem has 8,000 application partners worldwide, including hotel chains, airlines, cab aggregators, fuel stations, and restaurant outlets.
“We do not see Concur as a technology solution. My pitch to customers is: We help your employees get their weekends back,” said Neeraj Dotel, Managing Director, India and SAARC – SAP Concur. “Employees who are highly paid and who are trusted professionals shouldn’t be spending one or two hours a week putting expense reports together. When the spend happens, Concur captures it automatically and it goes into an expense report. All you need to do is validate and submit. We have eliminated (manual) expense reports worldwide.”
SAP Concur is solving problems for both employee and employer. From an employee perspective, it simplifies the process of recovering the money spent on behalf of the company. From an organisation’s perspective, it offers real-time visibility into what its employees are spending during travel. That takes care of several things: compliance, control and fraud.
Imagine a typical organisation with 10,000 employees who travel for work. The company does not have visibility into working capital until all these employees have filed their expense reports – and this could take a whole month.
SAP Concur offers a lot of convenience to travelling executives because of its wide integration with service providers worldwide (8,000 application partners). Let us take a look at some actual use cases.
Getting back to Sunil Gupta, who must take an early morning flight to San Francisco. Sunil books a Uber cab through the Concur app. His Finance department immediately receives the invoice and knows the amount spent and the route he has taken – and what time he left his home for the airport. A few days ago, Sunil booked his flight and reserved his hotel room using the Concur app, and Finance has a record of those transactions too.
Sunil has completed his check-in, immigration, and security check at the airport, and is longing for a cup of coffee. So he walks into a Starbucks outlet, orders a coffee and swipes his credit card to pay for it. He looks at the printed receipt that rolls out from the portable card scanner, checks the amount and then tears the receipt and discards it. He does not need it, because he knows an electronic copy has already been sent to his Finance department. Oh, and his Finance head knows that Sunil has checked in for his flight and is on his way to San Francisco!
When Sunil lands in San Francisco, he collects his bags from the belt and then books a Uber to take him to his hotel. The receipt for that transaction is sent to his Finance head, who knows that Sunil has arrived safely at his destination.
Sunil then checks into his hotel and swipes his card to block an amount, as is the customary procedure. A record of that is also sent to Finance, who knows that Sunil is now at his hotel in San Francisco.
When Sunil returns home a few days later, he does not need to file an expense report, because it was already done during the trip. And the exact amounts are known to the Finance department. Sunil can instead focus on claiming all his VAT rebates, and since this is also integrated with the app, the process is fast and simple. We will elaborate further in the story.
Tracking Employee Movements
Expense reports were sent to Sunil’s Finance department for every transaction during his travel. Date and time stamps, along with his location were included in these reports. Sunil’s organisation has a record of which meetings he attended and the meeting locations. Some may be uncomfortable about being tracked in this manner, but it can also work to their benefit.
“We launched a new product last quarter called Concur Locate. It is our solution for Duty of Care. It is based on the assumption that the world is becoming unsafe and it is becoming unpredictable for business travellers,” said Neeraj. “We can track employees based on their last credit card swipe – we can pinpoint an employee’s location based on the last transaction.”
For instance, during a shooting incident at a Las Vegas hotel, one company was very concerned about its employees who were in Las Vegas at that time. But it knew the location of those employees since they had swiped their card at a hotel. The company called its emergency response team in Las Vegas, who tracked the employees and sent them back to the airport.
Tracking is also useful for those who travel by road, using their vehicles, and later claim fuel expenses. In India, companies are cost conscious and want to have insights around mileage. Employees are entitled to a fuel allowance on a per kilometre basis. But how do you track that?
“You start your trip on Concur app and it connects with Google Maps. It tracks the time you took for the trip, the route and the distance travelled and the time you stopped your trip. Then you click ‘Submit’ and it goes into your expense report,” explains Neeraj.
Fraud & Compliance
As we mentioned earlier in this story, employees often forget the amounts spent during travel. This results in two types of fraud: intended and unintended fraud. Unintended fraud is when one believes they spent Rs 74 but in fact spent Rs 71. It is a Rs 3 difference, but in the corporate context, it is a violation of policy. Some may tend to over declare, intentionally. It can also add up to a lot when many people do this.
“We believe that half of all fraud is unintentional. The person doesn’t remember and makes an assumption. An undeclared fraud is a risk to the company. It is also a risk to the employee – senior executives have been fired because of mistakes in their expense reports,” said Neeraj.
Since the amount is captured as it is being spent (during the transaction), it mitigates fraud to a significant extent. Concur also limits employees from spending beyond entitlements. It ensures that the company travel policies are being adhered to, informed Neeraj.
“There is compliance to corporate policy. Employees at different bands or levels have a cap on spending. They should not exceed that without approval. So far there has been no way to enforce that cap. People would exceed their limit and then appeal for reimbursement of the full amount later,” he added.
Employees can also claim tax rebates and VAT when they return from international trips. But this process can be slow and cumbersome if done manually. If the receipts are not legible, then the amounts are reduced. And the settlement can take several weeks.
“If your spends are captured on the app the settlement would happen sooner. We have partners like TaxBack (globally) and VAT IT in India who are connected to the Concur platform. The VAT component is instantly reconciled if your company ties up with VAT IT. If the spend happens in the UK, for instance, you can reclaim the VAT component. This applies to every country that has a tax treaty with India,” informed Neeraj.
SAP Concur is also GST complaint and conforms to Indian taxation laws.
“You don’t have to worry about GST because the app knows that your base location is in Mumbai. Your company saves employee profiles to concur, and you need to specify your base location. The Finance department will take the GST amount and pass it on to the GST portal. Companies can claim tax credits,” added Neeraj.
Concur also supports FBT (Fringe Benefits Tax) and Indian travellers can take advantage of that feature whenever the country supports FBT.
The use of T&E applications is expected to increase further as more partners and service providers come on to platforms like SAP Concur. As we mentioned earlier, SAP Concur has 8,000 application partners worldwide. But what about the smaller service providers who are not yet on this platform? Employees can take a photo of bills and receipts and send it to Finance because the app supports OCR. SAP also has a stake in Cleartrip.com, and that ensures bookings can be made with Indian Low-Cost Carriers (LCCs).
Neeraj said global MNCs buy SAP Concur because of control and compliance. Concur enforces global compliance policies. He said Indian enterprises are cost conscious and use Concur because of the large savings it offers.
“Concur is the only solution in the world that gives you these three things: real-time visibility into where money is being spent; real-time control over how money is being spent; real-time savings through tax reclaim. But everyone loves us because when users switch to Concur their lives become easier,” said Neeraj.
SME’s have traditionally shied away from ERP solutions which they perceive to be too complex and expensive. They are now switching from Microsoft Excel to T&E applications because these apps do not need ERP and integrate with most accounting solutions.
And the sheer convenience of using a mobile app that is integrated with thousands of service providers worldwide is what is really driving user and corporate adoption.
“Globally our biggest customers are professional services companies; our biggest consumers in India are manufacturing companies. We have over 1,000 Indian customers. To name a few, we have customers like Marico, Godrej, GMR, Sun Pharma, and HCL. Nine out of 10 MNCs in India use Concur,” informed Neeraj.
The Road Ahead
While SAP Concur has made an impact in the T&E industry, and simplified expense reporting, it has the potential to do a lot more.
“If you look at the potential of Concur, it can eliminate the use of paper in reporting. We would love to partner with the government to eliminate paper receipts. Electronic receipts should be acceptable in corporate and government departments,” said Neeraj.
Concur has also developed an Alexa skill for voice-enabled search that is integrated with its travel management system. Users can activate Amazon’s voice assistant, by saying, “Alexa, ask Concur” to check on upcoming business trips, hotel bookings and other business travel information. Concur on Alexa for Business is currently in Beta testing phase.
According to Madanjit Singh, Managing director, Southeast Asia, SAP Concur, This will provide the business traveller with a richer and more personal experience. It will also set the trend for business applications to provide consumer-grade experiences to enhance productivity and simplify tasks.
(Alexa input from MC /Asia Magazine).
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