Did you know,
“There is an 8% rise in revenue and a 10% reduction in costs when an organization incorporates big data into their processes.”
This was reported recently by the Business Application Research Centre. Due to such positive financial results, most companies are actively looking to invest and explore big data.
Data has become limitless in today’s digital age. If harnessed properly, it can give clear insights into patterns that can be used by companies to make decisions. Hence, it can further streamline processes and enhance business profitability.
So how can we utilize expense management big data? Can it make a difference in time and cost? How can it help you make better financial decisions? Here, we will look into what big data is and how it can help your expense management process. Let’s get started!
Understanding big data
Over the years, a large number of datasets have been accumulated due to an increase in digital activities online. Big data is the gathering of varieties of data - structured, semi-structured, and unstructured data. This data can then be used to gain useful insights for effective decision making in a business environment.
Data can be collected over time and managed. The significance of big data does not revolve around how much data has been collected. But how an organization can use the gathered information. Data accumulated can be used by an organization as per their needs. And the more proficiently data is utilized, the more chances of making well-informed business decisions.
Benefits of utilizing big data in your expense management process
We understand that data can benefit a business, but how can it impact your travel and expense management processes?
T&E is the second-largest expense after payroll. As your business continues to grow, it’s crucial to reduce the percentage of expenses and make every dollar in your budget count. As a business, you can attain data from many sources. These sources can be from expense reports, corporate credit card statements, finance departments, and also third party supplier’s records.
Businesses can then leverage this data, for example, from expense reports, to evaluate and examine employee’s expense details. These insights can be used to discover patterns and make recommendations to improve your corporate travel programs.
Here are some advantages of using big data for your expense management process:
Insights into employees spending trends and patterns
You can get a large volume of data from your employee expense reports as well as from corporate credit card statements. All this data can be gathered from different sources and stitched together to get your employee spending trends and patterns.
Additionally, you can monitor :
- The category where most expenses occur
- Expense range of each employee level
- Department making the most expenses
- Overspending on business expenses
Gain vendor insights and build networks
The large volume of data that you acquire can tell you several things. When your employees submit an expense report or a trip report, it includes information about the suppliers and vendors. With big data analytics, you can identify the most frequently contacted vendors. Your companies can then build a relationship or negotiate a discount. This can optimize the spends and increase networking for the business.
Increase employee compliance
When you have a solid pool of data, you can measure if your employees are sticking to your company policies. The data can be analyzed to give you insights into out-of-policy behaviors and accumulated costs. It can also be used to identify top policy violators and fraudulent activities. This awareness can be used to create greater policy compliance among employees.
With these insights, you can also understand if your policies are effective. If there are multiple violations, you can try to know if it is due to unclear policies and/or weak enforcement.
Keep your T&E cost under control
Big data, if used proficiently, can help your business make wise decisions and keep costs under control. Wrong decisions can be made if essential details are overlooked, even though they might seem minor. With sufficient data into expenses, your company can allocate budget wherever necessary and cut down on unnecessary expenses.
Smart data management with the right tool
T&E management may be a heavy-duty work, but it is a process getting fed with loads of information. To make meaningful use of all the data collected, we need a tool that can make sense of it. That’s where a tool such as an expense management software steps in to enhance the value of this data.
With an expense management software, you can:
- Centralize and consolidate all the data- When you have data coming from all directions, it can be challenging to understand if it is not deciphered clearly. This can result in the company missing out on essential details. But when you have a centralized repository, all the data can be collated, and different metrics (currency, expense categories, an employee spends, etc.) can be consolidated.
- Analyze and convert data into a readable format- Different and large forms of data, if consolidated, become easier to read and interpret. When you have an easy-to-understand record, it becomes easier for the company to make decisions. An expense management software can do just that for big data. It makes it easy for you to view, interpret, and analyze all the big data.
- Accelerate your expense management process- The benefit of having a tool solely dedicated to data processing is that it cuts down manual labor and work. The automation reduces tedious chores and reduces the timeline. Furthermore, with past records and analytics, possible future trends can be mapped out. This can help the company to make wise decisions and avoid future risks.
For a company to function, there are operations and activities taking place daily. These undertakings involve an exchange of data. Hence, the volume of data is ever increasing. The big data collected from disparate sources can be collated to give a tangible solution and interpretation. An expense management software can maximize the value of big data. This, in turn, can strengthen your expense management processes.