How to implement an expense management solution?

With this blog post, I’ll continue where I left last time. At that time, I touched upon the importance of the pre-work, vendor research and the choice of solution. I also introduced the “Fifty-Fifty trap” term, which relates to the fact that 50 % of the organizations that choose to invest in a digital expense management solution doesn’t get the full benefit from it. Even though you initially have chosen a solid supplier with a good portion of process insight and the right solution on their shelves, you are still in the risk zone of ending up in the “Fifty-Fifty trap”. This can happen if the implementation process goes off track. Read on and get a few valuable tips on how to secure an optimal implementation process.

Process insight and mapping

It is crucial for the implementation process, that it is based on a detailed and thoroughly aligned process description. Together with your supplier or implementation partner, you should uncover your process. Potentially, you also need to and potentially also adjust this related to potential optimizations and process innovation. Remember, that the outstanding supplier will help you with this part even before the implementation phase is initiated. A tip, for when you are carrying out the process mapping, is that you also do an audit of your company rules and policies for employee spending.

The typical expense management flow is quite simple:

Employee > Approver > Finance

However, it is important to go into more detail. Different types of users need to be defined and described. The approval flow needs to be visualized. Is it a simple process with approval from a direct manager? Or is it, for example, a process with project or department approval? Also, the authority and approval levels for each role must be mapped. Finally, all part component and dependencies has to be drawn up. For example related to necessary ERP and salary system integrations, credit card providers, setup of accounting strings as well as an accounting plan and cost categories/types.

Get your data sorted

The next step is to get your data ready for the supplier or the implementation partner. Remember, that related to this, you need to be alert around the level of data security your partner has and the measures around this they have set up. Precision is key when you prepare your data, so be sure to invest an appropriate amount of time to get this task right. You need to have control over the following:

  • User data: Master data and categorization of your users as well as data for communication purposes.
  • Dimension data: Data for setting up correct accounting strings. Do you need dimensions for departments, cost centers, projects etc.? Are there dependencies between the dimensions and which should be visible for the respective users? Consider what choices the users should be able to make, when operating the solution.
  • Accounting plan and cost type: An accounting plan, to which the users enter their transactions, needs to be set up in your new expense management solution. Make sure that you define this with your users in mind, it needs to be logical and easy to interpret. Related to this work, you also need to factor in VAT codes and company policies for the respective cost types.
  • Accounting principles: It is important to align the accounting principles in the expense management solution, in order to make sure that the exchange and bookkeeping data will run correctly with our ERP system.
  • Payroll data: If you need to integrate to a salary system, so that balance and reimbursement are registered here, then you also need to define which system and what salary posts you need to set up.

It is also important, that you consider how the above data should be maintained going forward. “Best of Breed” solutions in the market offer the option to set up automatic maintenance of user and dimension data through integrations. It is often the complexity in your setup and your organization, that determines if more sensible to maintain these data manually in the solution.

Proof of Concept and Go-Live

When the solution is configured with user types, dimensions, accounting plans and integrations, I always recommend that a Proof of Concept is carried out. In other words, a test period based on processing real transactions/data in the solutions. During this period, it is possible to review the setup and adjust if needed.

During this period, you also need to prepare the live launch. One of the most important things to work on here is the user onboarding and education. If you choose the right solution, it also comes with a high level of user friendliness and an intuitive user interface. Therefore, you should be able to get through this part of the process with relatively ease, when we talk about regular users. I’m not saying that you shouldn’t do anything, but make sure you keep focus on fast adoption of the solution. With this I mean, get the users to download the mobile app, get them engaged with the training material and get them to use the app as soon as you go live.

For the finance and administration users, it is important to really get them involved in the project at an early stage. They need to act as your internal ambassadors for the tool. I recommend a pro- / super-user approach, where you need to get your supplier involved in the training of finance and administration users, so that they can pass on the knowledge to the regular users.

Related to all the above, it is obviously important to have all communication material ready as well as training sessions needs to be planned before going live with the solution.

Get the most out of your solution

Fact is, that the implementation of a solution of this kind is a relatively manageable project to run for most organizations. This is positive. But you still need to be alert, because this fact can also tempt suppliers or implementation partners to slacken regarding quality of the implementation work. If you have the above input in mind when you’re initiating the implementation process, you will, however, be in a good position to get the most out of your investment in an expense management solution.

Lars de Nully

CEO & Founder