No one wants to be nickeled-and-dimed to death, but sometimes pinching pennies can make a big difference. Companies are beginning to invest in software and services that can automate expense management and shave off a few dollars in the process. Studies by AMR Research and Aberdeen Group indicate that companies can cut the cost of processing a single report by as much as 75%. Savings come primarily from reducing the time spent by employees and accounting staff on creating and handling expense reports; some companies also report significant benefits from improved compliance with corporate travel and expense policies.
The financial outlay--an average of $164,000 for the first year, says one of the studies--does daunt many companies. According to AMR analyst Monica Barron, however, some firms make back their initial investment in as few as six months. Research conducted by Aberdeen reveals similar results. But be aware that because the costs depend on the number of users while the benefits depend on the number of reports, it's possible for a company not to see a positive return. In these instances, focusing on such gains as better policy compliance or fewer errors may help support a business case.
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This calculator uses benchmark data from Aberdeen and software costs from expense management software vendor Necho Systems. Necho is reworking its version of this tool. Look for it soon at www.necho.com.
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