There will be many enduring memories of the coronavirus pandemic. One which will probably be somewhat overlooked in comparison, is that it will likely represent a coming-of-age moment for the virtual office. With increasing numbers of organizations implementing work-from-home policies for their teams, the use of collaboration and communication solutions such as Slack and Zoom is likely to increase significantly. Companies that previously didn’t use these tools as much (or at all) before the pandemic but adopt their use for working at home will likely continue to use them extensively once their employees are back to the office.
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One function which may be less prepared for an extended work-from-home policy is the finance operation, which often remains far more dependent on paper-based processes than other functions. Invoices and employee expenses are often still mailed to the finance department, where they need to be manually reviewed and approved, often by multiple employees, and then entered into the accounting system for processing. Not only does it require the process to be physically centralized, but it’s also incredibly inefficient and takes up time and resources that could be better spent elsewhere, either in the office on more productive tasks, or using the free time that automation can offer.
In the event of employees being required to work from home, this process breaks down entirely. External mail piles up (assuming USPS keeps delivering) and intra-office mail stops. With nobody to review and approve invoices and employee expenses, or manually enter the data into the financial system, vendors don’t get paid, and employees don’t get reimbursed. While this may not cause major problems if an office shutdown lasts for a week or two, should the event continue beyond this, it could start to have a significant impact on personal and business cash flow. Many organizations and individuals are already starting to worry about the financial impact of coronavirus through potential lost wages and revenues, so anything that can be done to minimize this impact will help.
Moving functions such as expense, vendor invoice management, and card program management away from highly manual, paper-based processes can not only make the process far more efficient for the expense submitters, who don’t need to worry about saving receipts and filling out spreadsheets, but also makes the approval and reconciliation process far more efficient for the finance team. Expense owners and vendors simply need to capture and upload a receipt image or forward a purchase email to the system, which will automatically scan and parse out transaction data in order to create an expense item. Expense policy rules are already configured into the system, so there’s no need for expense owners (or approvers) to verify if each expense is within policy.
Once submitted, managers receive an email notification that they have an expense report to approve, prompting them to log on to the expense solution. There, they can easily view receipt images, and transaction details, and can see if an expense is within or outside of a corporate policy with an on-screen notification. Once they have OK’d the expense, the next person in the approval chain receives their notification, and so on. Upon final approval, the data can be automatically exported to, and coded in the GL, with a notification sent to the organization’s bank to reimburse the user with an ACH (or BACS, SEPA, EFT, Direct Entry, etc.) payment.
While moving this spend functions from centralized, paper-based processes to virtual, cloud-based processes can help during times where office access isn’t feasible, it can also drive significant long-term financial and operational benefits. This can range from reduced processing costs and fewer mistakes, to more effective cost control and deeper, analytics-based insight into corporate spend, which can drive long-term strategic improvements.
An additional benefit of automating previously manual processes is the human impact on employees. Business travelers no longer need to spend hours at the end of their trips compiling expense reports, so they can spend more time on productive work as well as with their family. Vendors and contractors don’t need to wait weeks to be paid. Approvers don’t need to keep referring back to employee handbooks to see what is and isn’t within policy. And for the finance team, instead of having to manually check and enter data line-by-line into the accounting system and setting up check runs, they can focus their time on activities such as data analysis and planning AND with these tools in place, they can do it from anywhere on a mobile device.
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For more insight into how organizations can optimize operations in a work from home environment contact us at wfh@abacus.com or sign up here.
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