There is a big difference in how efficiently Nordic companies manage their travel expenses. Millions can be saved for those who are willing to review their expense management solution.
The most efficient companies spend an average of 8 minutes per expense, the least efficient ones need 10 times as long. Companies in Denmark, Norway and Finland are most efficient since these countries allow digital receipts, while Swedish tax authorities do not accept them. On behalf of Eurocard, researchers at the Royal Institute of Technology in Stockholm have investigated what routines companies have to manage employees' travel expenses – and how efficient they are. The results show that the differences between the most efficient and the least efficient companies are significant.
"The study shows that there is potential for significant cost reductions if companies automate their expense management, especially for companies that are growing rapidly," says KTH professor Niklas Arvidsson, who conducted the study together with doctoral student Richard Backteman.
The average company in the survey has 3,750 employees and spend 24 minutes per expense. Compare this to the most efficient companies, which handle a single ex-pense in 8 minutes. That is a cost of at least a few million SEK in a year as a direct result of inefficient procedures in expense management.
What the most efficient companies have in common, is that they have all introduced and use digital receipts. Since Swedish tax authorities will not approve anything but paper receipts, you will find these companies in Denmark, Norway and Finland. The incentives to replace inefficient manual routines with efficient centralized and automated systems can differ greatly between companies in different industries. Of course, companies with employees that travel more, benefit more from streamlining their expense management compared to companies where employees hardly need to travel in the line of work.
”The trend is clearly towards automation and centralization of expense management. But there are still many companies that aren’t taking advantage of this potential for savings, money that they could spend on things that generate revenue, ” says Rolf Sten Andersen, CEO of Eurocard.
A few facts from the KTH report on corporate expense management:
- The average time a typical company takes to handle a single expense is 24 minutes.
- The most efficient companies can do it in 8 minutes.
- The least efficient companies need 10 times more than the fastest ones.