In today’s user-driven, distributed business environment, employees at all levels of your organization are making purchasing decisions. This bottom-up spending facilitates fast growth because employees can get exactly what they need, when they need it. But when employees make purchases willy-nilly on the company’s dime, finance lacks the control and visibility needed to accurately budget, forecast, and manage cash flow.
To face this challenge, many companies have enabled a spend management system, proactively controlling spend with streamlined approval workflows and card limits. Others have adopted band-aid solutions like expense reporting, reimbursement, or procurement that provide at least some level of control, albeit incomplete. Employees at these companies are expected to operate within the guardrails set by the purchasing policy. But it can be challenging to enforce compliance.
In fact, one small employee group in particular may pose an outsized challenge: your executives. Most employees generally want to follow your purchasing process; they might misstep to avoid being slowed down by approvals or expense reports, or because they are unaware of policy, but they generally want to do the right thing.
And your executives are no exception - but when they misstep, the effect is much greater. Executives often have discretionary spending authority and bigger budgets. They are also less likely to have the time to fill out administrative paperwork, which can result in frustration for the finance team.
In fact, 70% of finance professionals contend senior-level executives poorly manage their expense reports, according to new research from Teampay and Kelton. And while it is easier to establish guardrails for junior employees, executives are harder to rein in.
Executives need a card to help them lead the charge
Your organization is led by its executives. They are tasked with analyzing information from across the business, reviewing market trends, and making quick, intelligent decisions to develop future strategy. They need finance processes that allow them to move fast, instead of slow them down.
Executives deserve a purchasing experience that was purpose-built for today’s digital era. “The role of digital has forever transformed the way we transact and has shifted the expectations for quick and simple payments,” said Sherri Haymond, Executive Vice President, Digital Partnerships at Mastercard. The shift in expectations goes for your executives, too.
Try Spend Management Software for Yourself
Navigating this digitally-driven business landscape requires a digitally-driven approach. Simply digitizing an existing process isn’t enough; only by rethinking the workflow entirely can you provide an end-to-end connected experience, for both online and in-person purchases.
As employees begin to return to a physical office and even take business trips, point of sale purchasing has already started to increase. Modern business demands a way for executives to connect these offline purchases with their digital systems to reduce friction and manual work.
This means integrating payments with coding and receipt capture, and seamlessly pushing that data through the workflow. It means tying card numbers to an individual purchase, instead of a series of purchases to one card. It means offering the most advanced security features, multiple payment options, and premium benefits for your VIPs. It means making it easy for executives to submit receipts and be compliant, without adding unnecessary friction. It means an executive offering that looks like it belongs to the leaders of the future - because it does.
Develop a positive relationship between executives and finance
Your execs spend most of their time moving quickly to develop and execute important strategic plans for your company. As a result, it can be difficult for them to find the time to fill out expense reports or submit receipts - or even worse, for administrative staff to untangle the monthly corporate card statement and decipher receipts.
But since executives are often your company’s biggest spenders, a lack of compliance hits the finance team hard. The larger purchases mean larger surprises for finance, who aren’t able to see what’s been spent until the expense report comes through. This can also lead to extra time spent chasing executives for receipts and other information to understand what’s been spent and using best guesses to code and reconcile transactions in order to close the books.
Though neither party is ill-intentioned, the misalignment results in friction — but the relationship doesn’t have to be strained. After all, both parties are working toward a common goal; it’s just a matter of considering the other’s perspective and giving them the tools they need to do their jobs.
By providing a connected purchasing experience, finance teams can facilitate executive spending in today’s environment. With digitally-driven solutions that re-imagine the process, executives can spend easily and quickly at their discretion, and provide information to finance in real time as part of a natural workflow. With this real-time data, finance can in turn provide more actionable, timely insights to inform business strategy. Instead of butting heads with the leadership team, the right business processes make finance a strategic partner and ally - and everyone wins.