Prepare your expense management for 2021
The coronavirus has confronted companies, wherever they are in the world, with a whole new reality.
We lived in a time when the things we took for granted - such as being able to travel to work and leave home with a light heart - are temporarily denied us.
Financial processes, such as expense management, have changed since companies have had to move to telework. Many people now work from home and face new technical problems. Some have to review their internal processes because of the confinement.
If you're a CFO, the coronavirus will have been a nice challenge. This unexpected event has forced us to change the way we do things. You may now have to rely on technologies you didn't use or know about before.
However, nothing lasts forever, and economic activities are slowly returning to pre-pandemic levels. The development of effective vaccines also tells us that there's a light at the end of the tunnel - and that you need to be ready for recovery and keep up with the pace.
Business trips will make their return, but it will take us a long time before we get back to the same level as before the coronavirus if it ever does.
McKinsey says it will be done in stages regarding the return of companies and their employees to airports and hotels. Your company should therefore monitor health and safety requirements, as well as the willingness of employees to travel.
Domestic and regional travel may resume more quickly than international travel. Once containment restrictions are lifted, your employees may feel safer to travel by car rather than by air to limit the risks.
Daily, many companies will be reluctant to bring their employees back to the office, especially given the success demonstrated by working from home during lockdown periods.
You may have already adapted your fee policy to prepare for this.
Many companies have changed their strategy to deal with the problems caused by the coronavirus.
The work will never be the same again, even if we don't know what the future will look like exactly. Google employees, for example, will continue to work from home until the summer of 2021, while Twitter announced in May 2020 that its employees will definitely work from home.
Stewart Butterfield, CEO, and co-founder of Slack, author of the company's chat and collaboration software of the same name, believe that your company will be part of a major and far-reaching shift and that you may need to offer your employees new choices in terms of flexibility, conditions and work/life balance.
According to Slack's Future Forum survey, most employees do not want to go back to the old way of working. Only 12% of them want to work full-time at the office, while 72% aspire to a hybrid teleworking model for the future.
If the future is to be the one Stewart Butterfield expects, your finance department will potentially face flexible working difficulties. If coronavirus hasn't already forced you to take inefficient processes and technology head-on, a hybrid work environment will do it for you.
You have the opportunity to meet many of the challenges of flexible, hybrid, and remote working by using the appropriate tools and technologies. Think, for example, innovative salary packages, investing in training and support, and using widely available cloud tools.
Your processes need to be ready for the increased flexibility of your workforce. When the containment is lifted, where and how people work will have become more complex. Some will return to the office, others will continue to work at home, and still, others will opt for the hybrid approach - a mix of both.
You can choose to let employees organize their hybrid work and allow them to plan their work according to their lives as they see fit.
But in the future, you may have to decide to set aside some days for meetings and collaboration at the office and allow remote days for a type of work that requires individual concentration. Or, as an alternative, you can set aside specific weeks for office work and other weeks for telecommuting. You may also have to make decisions about whether you still need physical offices.
In dealing with a hybrid workforce, you may have already made changes to your fee policy due to the pandemic.
The shift to telecommuting means that employees will be more likely to enter expense reports for materials rather than lunches with customers. And you have potentially seen the emergence of new types of expenses due to coronavirus, for which you may not have already decided on a policy.
If your company employs people who work from home, you can, but don't have to, provide them with a temporary telecommuting allowance.
You may have already considered compensating employees for justified and necessary telework expenses. Here are some of the things that may be included in these expenses:
- mobile phone expenses;
- Internet costs;
- computer or tablet expenses;
- telecommunications software and hardware.
When you write a home-work expense agreement, you will probably want to exclude some, such as faster Internet connections, extra screens, printers, and ergonomic seating.
You should ensure that your company policy specifies what expenses will be compensated.
In light of declining revenues and continued uncertainty, it is essential to keep tight control over expenditures.
Ensuring clarity in your expense management will be a key factor - you need data to create KPIs (Key Performance Indicators) and identify cost centers.
Your finance team -if you're lucky enough to have one, otherwise it will be you- will need tools and processes to perform these tasks. These include real-time data management tools, which are essential for effective cost control - for example, expense management software.
Coronavirus has also accelerated the shift to digital payment methods - a variety of digital methods are available to pay your operating costs.
The need for flexible, digital management will result in a huge shift - from traditional processes to cloud-based software. Your company will need to manage its costs in the form in which they are incurred. This has probably already accelerated your journey of digital transformation, improving and refreshing your technology solutions.
So it's more than likely that choosing expense management software is a perfect idea.