News & Analysis

Companies Struggle with Travel Expenses

A new study says that companies find it tough to integrate travel expense management in spite of digital transformation initiatives

A new study by Forrester Consulting suggests that companies are looking to accelerate the pace of their digital transformation of travel and expense accounts in order to support employees to have a seamless experience during business travel. 

In fact, a majority of the companies surveyed had poor integration between travel & expense tools with manual processes and security concerns emerging as their top challenges. Only 52% of those surveyed globally were utilizing fully integrated T&E solutions while 44% were using only partially integrated ones, says the survey. 

The study titled Digital Transformation for Travel and Expense, was commissioned by travel tech solutions provider Amadeus through its subsidiary Amadeus Cytric Solutions. The research agency reached out to 525 senior decision makers representing companies in the revenue range of $100 million to $5 billion as well as about 2,000 of their employees. 


The need for reform has general acceptance

A key point that emerged from the survey was that Indian companies do recognize the need to modernize their T&E tools but struggle with its integration into their tech stack. Those surveyed represented heads of finance, procurement, travel management, IT and HR divisions, says the company in a press statement. 

Mani Ganeshan, APAC Engineering Head and Centre Head, Amadeus Labs, says, “New digital technologies such as automation and machine learning have led business efficiency to emerge as a key focus for several organizations. Expense management is a critical aspect of digital transformation that offers new levels of efficiency and better ways of working. The promise of a single, integrated solution to manage all corporate travel and expense needs is, thus, enticing. It is no surprise that companies are now thinking transversally, looking to improve their T&E processes and tools across departments.”


Automation is on, but integration isn’t

The global study revealed progress toward automation, with 80% of global respondents stating that T&E is more digitized compared to other processes within their companies. These findings are compared to a figure of 67% when the survey was conducted in 2020. But current T&E management still presents several challenges. 

Many firms have poor integration between T&E tools; manual processes and security concerns remain top challenges. It revealed that 34% of Indian organizations face challenges managing compliance for travel, like visas and work permits, while 36% have privacy and security concerns around the existing processes. 

While 23% of Indian organizations say submitting, approving, and processing expenses as well as reconciling invoices and payments were still very manual tasks putting a strain on employees’ productivity, the survey revealed that only 36% of systems integrate with an organizations’ T&E solutions leading to suboptimal performance and poor employee experience. 


Full integration is still some way off

Worldwide only 8% of finance leaders reported being close to fully digitized expense reports. On top of this, some organizations (24%) still relied on spreadsheet-based solutions for managing travel expenses. The study reveals that the difficulties companies face with their T&E tools have implications on business and employee experience. Nearly half of respondents noted these inefficiencies resulted in decreased productivity, and 44% reported poor employee engagement

and reduced employee satisfaction with technology. Low adoption of company tools was the top business impact, which might also lead to lower compliance to travel policy.

However, respondents whose firms have an integrated tool experienced this less (36%) compared to other firms (43%). Only 31% of respondents’ firms with an integrated T&E tool indicated difficulties in negotiating travel supplier contracts compared to other firms (42%).

A vast majority (91%) of Indian organizations agreed that improving their T&E processes and tools is critical to reducing cost and increasing efficiency in business operations and said T&E management tools need to enable a collaborative and efficient travel booking, payment, and expense experience. 

The study also revealed that across all organizations, the top employee complaint was that employees had to pay trip expenses from their own pockets and then had to submit an expense claim – a situation organizations can overcome by deploying virtual cards and other integrated solutions. Firms with integrated solutions have less employee complaints. 

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