Expense Management: Better Ways to Buy

Sometimes costs don't need to be cut so much as captured, quantified, and reconsidered.

David Griebl, vice president of shared services at Monster Worldwide, says that lost invoices were all too common at his company, resulting in everything from canceled cell-phone subscriptions to, in one case, the near termination of electricity to an office where a bill got buried under a stack of papers.

Now that the company has instituted an E-invoicing system, “those horror stories are over,” says Griebl. An electronic invoice shows up in the queue of the person who needs to approve it. If it’s ignored for a few days it goes to the person’s boss. That seems to make people more attentive to their queues.

Ironically, Monster signed on not for the direct benefits of E-invoicing, but because it also satisfied a Sarbanes-Oxley requirement. “We wanted to make sure that when someone approved a $100,000 invoice they really had the authority to spend $100,000,” says Griebl.

It Takes an iPod

All forms of spend and expense management come with challenges. Managers complain the software still needs to be more user-friendly, and interfaces with existing software need to improve. And technology alone can do only so much. “Do not assume that the spend-management solution will save you money,” says Neil Deverill, a London-based consultant who has headed procurement departments for several large multinationals. “It can improve your knowledge of who is spending what with whom, but you will still need to improve your business processes. And, you may have to recruit specialist talent and do some extra training to get the most from it.”

The biggest challenge may well be getting the workforce on board. No one likes change, even if it means getting reimbursed for that client lunch far more quickly than before. C-level sponsorship is essential. So is patience. When it rolled out new invoicing software, Monster surveyed a pilot group, used that feedback in training and communications, and held a contest in which the first 50 early adopters received an iPod. “We really thought we’d sold it and that we understood the concerns,” says Monster’s Griebl. “But they linger. People are difficult to change, even if you’re helping them out.”

Next time maybe a MacBook Air?

Yasmin Ghahremani writes about business and technology from New York.

What Companies Want

Top 10 reasons cited for adopting spend-management software or services

Spend-Management Priority

• Deliver measurable results that correlate to bottom-line metrics
• Accessing and analyzing spend data
• Identify savings opportunities faster
• Increase visibility to upcoming spend in majority of spend categories
• Supporting multiple business units or geographies
• Completing projects on time and within budget
• Recruit, audit, and measure performance of your suppliers
• Build internal commitment for spend-management programs
• Ensure end-user adoption of your spend-management solution
• Extending coverage without adding resources

Source: Ariba Inc. survey of 600 finance, procurement, and business executives

Predicted growth in supply-chain sourcing over five years
Spend-analysis software is a small but fast-growing market.

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