2016 business travel trends and expense management best practices

LIVE WEBINARJune 28, 2016

Hosted by CFO.com | Presented by Certify

2016 Business Travel Trends andExpense Management Best Practices

Learning Objectives

• Annual T&E benchmark spending trends by expense category and company size

• Expense management strategies used by small, midsize and enterprise companies

• Best practices and solutions to improve process efficiency and spending control

• The often “hidden” costs associated with expense report processing

• How automation delivers a full ROI for 92% of all companies in 2 years or less

Attending this event will help you understand:

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Today’s Presenter

Ernie HumphreyPresident

360 Thought Leadership Consulting

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Featured Speaker

Robert NeveuPresident and Co-founder

Certify

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• Industry-leading, first fully automated travel and expense management system

• 64 languages, 140+ currencies, clients in 80 countries

• #1 highest rated expense management software for user satisfaction on G2 Crowd

• PC Magazine Editors’ Choice for best expense management software of 2016

• Processing over 30 million expense transactions and $10+ billion in expense reports for 2015

About Certify

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Business Travel Trends

T&E Spending Around the World

U.S. business travel spending 2015

$310b

$1.25tglobal business travel

spending 2015

Global Business Travel Association 2015 7

Business Investment in T&E

8-12%total annual budget for T&E expenses1

1. Aberdeen Group 20152. PayStream Advisors 2015

25% of all U.S. companies spend $1 million or more on annual T&E expenses2

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Base Costs Per Trip

Travel Leaders Corporate 2015

Average business trip cost for air, hotel and car rental:

INTERNATIONAL DOMESTIC

$2,502 $1,002

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U.S. Business Travel Breakdown

74%under 250 milesfrom home office

48%involves a

personal vehicle

69%do not require

air travel

Global Business Travel Association 2015

U.S. Travel Association 2015

Of the 1.3 million domestic business trips made daily:

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What’s New With Business Travelers?

97%of business travelers carry at least one mobile device

Mobile is Made for Travel

Expedia/Egencia Mobile Index 2015

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• Nearly 80% of business travelers used their smartphone to plan or book corporate travel in 20141

• 76% of travelers say their smartphones are “very important/critical” to daily life; 70% feel the same about their laptop1

• Global mobile payments market up 38% from 2015 to $620b worldwide2

• More than 45% of best-in-class companies use mobile expense apps (89% spend under management, 91% compliance rate)3

Mobile Travel Trends

1. Expedia/Egencia Mobile Index 2015 2. TrendForce 2016 3. Aberdeen Group 2014

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Ground Transportation Trends

Certify SpendSmart Report 2014 - 2016 14

Ground Transportation Trends

+1890% ride-hailing receipts in 2 years

Certify SpendSmart Report 2014 - 2016 15

Convenience and Cost

55%Lower average fareper transaction

Certify SpendSmart Report Q1 2016: Average cost for Uber includes all UberX, UberXL, UberPLUS, Uber Taxi, UberBlack, UberSUV and UberLUX rides. Certify has a relationship with Uber as an integrated expense management solution.

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The Dimensions of Effective T&E Expense Management:Visibility & Benchmarking

1. Meals 19%

2. Airfare 17%

3. Misc. 17%

4. Lodging 14%

5. Gas 11%

6. Cell phone 5%

7. Car rental 5%

8. Groceries 5%

9. Supplies 5%

10. Taxi 3%

11. Shipping 2%

12. Tolls 1%

13. Parking 1%

How the Expense Budget is Spent

Certify SpendSmart Report, Q4 2015

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$98.75DAILYMEAL COST

2016

1. Meals 19%

2. Airfare 17%

3. Misc. 17%

4. Lodging 14%

5. Gas 11%

6. Cell phone 5%

7. Car rental 5%

8. Groceries 5%

9. Supplies 5%

10. Taxi 3%

11. Shipping 2%

12. Tolls 1%

13. Parking 1%

How the Expense Budget is Spent

Certify SpendSmart Report, Q4 2015

2016 Business Travel News Corporate Travel Index 19

Category 2014 2015 Difference

Gas $40.41 $30.32 –24.96%

Airfare $345.21 $274.00 –20.62%

Lodging $213.90 $223.45 +4.64%

Car Rental $193.58 $186.45 –3.68%

Cell Phone $89.30 $92.24 +3.29%

Meals $25.67 $26.06 +1.52%

Parking $32.70 $32.23 –1.43%

Taxi $31.81 $31.82 +0.03%

Benchmark Spending by Category

Certify SpendSmart Report, Q4 201520

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The Dimensions of Effective T&E Expense Management:Policy & Spending Control

Polling Question 1

a) We have no formal T&E policy b) Manual review processc) Automated system that flags violationsd) Policy is not enforced

How does your organization enforce compliance with T&E policies?

73%

T&E Policy Compliance

85%of all companies report

having a writtenT&E policy in place

of those companies are manually reviewing

for policy violations

Manual policy review is inefficient, prone to error and fraud

Certify Annual Travel & Expense Management Survey 2016

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T&E spending is the 2nd most difficult operating

expense to control

Forrester Research 2015

T&E policy is not enforced Employee is responsible Manager manually review each expense

Manager manually review, checking only high value

expenses

T&E system automatically flags out-of-policy violations

6%

31%

42%

20%

26%

Policy Enforcement Practices

Certify Annual Travel & Expense Management Survey 2016

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T&E policy is not enforced Employee is responsible Manager manually review each expense

Manager manually review, checking only high value

expenses

T&E system automatically flags out-of-policy violations

6%

31%

42%

20%

26%

53% of companies on a web-based system

Policy Enforcement Practices

Certify Annual Travel & Expense Management Survey 2016

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The Dimensions of Effective T&E Expense Management:

Process Efficiency

Polling Question 2

a) Under $7 per reportb) $10−$20 per reportc) $25 or more per reportd) We do not track these costs

What is the average cost to process a single expense report at your organization?

Cost to Process a Single Expense Report

$6.85fully automated

$17.31 semi-automated

$26.63 manual process

PayStream Advisors 2015

28%

19%

5%

48%

Under $7 per report $10−$20 per report $25 or more per report

We do not track these costs

Certify Annual Travel & Expense Management Survey 2016 29

Leading frustrations for T&E program administrators:

Top Expense Management Pain Points

50% employees

losing receipts

45% employee’s failureto submit reports

on time

38% time it takes to

reconcile, reviewand approve

30% reviewing for

policy violations

28% errors onthe report

Certify Annual Travel & Expense Management Survey 201630

Systems and data integration

Mobility/mobile access

Travel booking

Transparency/visibility into reporting data

Expense management process

9%

10%

11%

21%

37%

Key Areas for Improvement

Certify Annual Travel & Expense Management Survey 2016

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Systems and data integration

Mobility/mobile access

Travel booking

Transparency/visibility into reporting data

Expense management process

9%

10%

11%

21%

37%

Key Areas for Improvement

Certify Annual Travel & Expense Management Survey 2016

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A COMBINATION OF ABOVE

A TRAVEL AGENCY

CORPORATE TRAVEL SOFTWARE

ONLINE TRAVEL SITES

0% 10% 20% 30% 40% 50% 60%

43%

22%

15%

20%

29%

15%

5%

51%

Manual Web-based

Certify Annual Travel & Expense Management Survey 2016

Travel Booking Technologies

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Travel Booking Best Practices

Pre-Trip Approval:Requires manager authorization prior to booking; configurable by employee,

policy specifics, etc.

Lowest Logical Fare:Automatically identifies best available rates for proposed itinerary (and only

best available rates)

$

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Companies that track/apply unused tickets can save 5-8% of

total annual travel budget

2015 GBTA Ancillary Fee Handbook

Polling Question 3

a) Paper-based/spreadsheetsb) ERP system (Oracle, Microsoft Dynamics, etc.)c) Web-based expense software (Certify, Concur, etc.)d) Not applicable

How does your organization currently manage T&E expense reporting?

Methods for Managing T&E Reporting

Consistent mix of expense management systems:

Certify Annual Travel & Expense Management Survey 2013-2016

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Web-based solution (Concur, IBM, etc.)Microsoft Excel/spreadsheetsPen and paperHomegrown solutionERP/accounting package (Oracle, SAP, etc.)

T&E Systems by Company Size

MANUAL SYSTEM USAGE: 70% small businesses | 26% enterprise

22%

55%

10%

5%8%

37%

37%

9%

4%

13%

46%

16%

4%

6%

28%

SMALLBUSINESS

MID-SIZEBUSINESS ENTERPRISE

Certify Annual Travel & Expense Management Survey 201638

Improving Expense Management

Are you planning to switch or currently in the process of evaluating vendors for a new web-based system?

37%SMALL

BUSINESS

46%MIDSIZED

COMPANIES

53%ENTERPRISE

Certify Annual Travel & Expense Management Survey 2016

62% of all companies planning to make the switch will do so in the next 12 months

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Reimburse employees faster

Improve employee compliance rates to corporate policy

Gain reporting and analytics around T&E spend

Provide system accessibly from anywhere (online, mobile)

Simplify process for employees and managers

25%

28%

32%

40%

66%

Driving Force Behind the Switch

Certify Annual Travel & Expense Management Survey 2016

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Reducing processing costs is the #1 T&E improvement for 48% of

all best-in-class companies

Aberdeen Group 2015

Best-in-Class T&E Strategies

Aberdeen Group 2015

Expen

se reports

audited re

gular

ly

Automatic li

nkage

betwee

n expen

se mgt. a

nd back-en

d syste

ms

Online t

ravel b

ooking syste

m

Commercial ca

rd syste

m/program

End-to

-end ex

pense

mgt. solution

88%

58%

87% 77% 68%63%

34%

63%50%

35%

Best-in-Class Industry Average

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Must-Have Expense Reporting Features

Automation: Expense report creation, workflow process and approvals, direct credit card feeds

Mobile Applications: Smartphone-enabled receipt image capture, mobile report creation and approval, and policy tools

Compliance: Duplicate receipts/expenses, category spending limits, automatic notification of violations

Integration: Accounting software, general ledger, HRIS, CRM, ERP, ACH direct deposit

Reporting: Complete visibility into process and spending by category, department, employee

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The Economics of Effective T&E Expense Management: Defining the ROI

Automation Drives ROI

Certify Annual Travel & Expense Management Survey 2016

Businesses of every size are quickly realizing ROI:

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How ROI is Achieved

What are the ways you’ve achieved ROI on your automated expense management system?

Certify Annual Travel & Expense Management Survey 2016

Impr

oved

effic

iency

/expen

se re

portin

g pro

cess

Reducti

on in

proce

ssing

costs

(less

paper

, pos

tage,

stora

ge etc.

)

Mobile

acces

sibilit

y

Increas

ed emplo

yee p

rodu

ctivit

y

Elimina

tion of

paymen

t for d

uplica

te ex

pens

es

Reducti

on in

over

head

/staffin

g requ

iremen

ts

58%53%

33%26% 22% 22%

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Automation Gets Results

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Benefits for Businesses & Travelers

• 65% reduction in processing costs via mobile expense reporting

• Expense report automation increases employee productivity 29%

• Best-in-class expense management drives 87% rate of compliance or greater to company T&E policy

• Of companies switching to an automated system, 39% report higher employee satisfaction after adoption

• 28% less accountant time spent approving expenses for companies with an automated system spent

Aberdeen Group 2015

PayStream Advisors 2015

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Effective T&E Expense Management

• Visibility into T&E Spend by Category

• Benchmarking by T&E Spend Category

• Clear & Enforceable T&E Policies

• Governance & Control over T&E spend

• Process Efficiency from Expense Report Creation to Reimbursement

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Questions?

For more information about Certify, go to www.certify.com

Thank you!