Navan commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying travel and expense management.¹ This abstract will focus on the use of Navan expense management and its value to their organization.

Out of the five interviewees interviewed for the original TEI study, the travel manager from a payment services organization and the global category manager from a life sciences organization noted their organizations had implemented Navan Expense as well as Navan Travel. The other interviewees said their organizations had either started implementing or were planning to implement Navan.

Navan offers one platform with both travel and expense management; the original TEI study covers both, while this Spotlight focuses wholly on expense management.

Organizations across industries can benefit from an easy-to-use expense management platform with flexible, in-built policy management that can automatically flag and reject out-of-policy transactions, improving compliance and reducing costs. Employees can quickly and easily claim expenses as and when they want to and because the context capture is fully automated, there is no need to build a report: from the tap of a payment card to data going into a company’s accounting system, the transaction is automatically submitted for review; furthermore with Navan’s mobile app, employees can check corporate spend policies and how they’re tracking against them in real-time. By investing in both Navan Travel and Expense, finance and accounting teams save 40% of the time managing and reconciling expenses through easier data visibility, collection and reconciliation; employee training and technical maintenance costs are reduced, given there is a single tool and process rather than two (or more in some cases); and employee travelers need only access one tool.

Investment Drivers For Expense Management

The interviewees’ organizations adopted Navan Expense to optimize the workforce experience and improve policy management. These organizations struggled with several challenges in their legacy environments, including:

• Time-consuming expense submission processes. Legacy tools were not intuitive, and employees had to spend a lot of time on expense claims. In one case, the interviewee said they even needed to refer to a large manual to ensure expenses were properly submitted. In another case, there were three separate tools they had to access. Not only did this waste employee time but also resulted in a poor employee experience.

• Lack of spend visibility for administrators. Before the Navan investment, management of expenses was more difficult, and policy enforcement was typically manual and retroactive. In addition, the interviewees said their organizations struggled to manage expenses because they were using different tools in different regions. Not only did this mean expenses administrators had to spend a lot of time finding and reconciling data as well as enforcing policies manually. This, in turn, resulted in low productivity and overspending.

• Costly and suboptimal expenses tools. The global category manager in the life sciences industry told us that before investing into Navan, their organization used multiple systems for the different legal entities that make up their enterprise, which resulted in additional technical maintenance requirements and different teams had to learn to use different tools; finance and accounting teams also had to spend additional time reconciling data from these disparate systems. The travel manager said their payment services organization was previously using three tools, one of which did not scale well and resulted in a disjointed and overly complicated submission process. Not only did this result in unnecessarily high technology costs but several systems had to be supported, requiring multiple policies and significant maintenance and staff training.

Expense Management Features

The interviewees’ organizations chose to invest in Navan Expense for the following reasons:

• Built-in expense policies. Interviewees said that Navan allows their organizations to customize policy settings. Any out-of-policy expenses could also be immediately flagged or even declined at the point of purchase. These policies could be very specific. For instance, one interviewee noted that in some regions, their organization had a cap for meals expenses, while in others, it was a daily set amount.

• Elevated user experience and mobile app. Interviewees said improving user experience was critical. The global category manager at a life sciences organization shared: “The mobile app is super easy to use. You’ve got everything on the go, so while you’re traveling, you can see all of your itinerary, make changes on the app, and contact support.” Furthermore, the interviewees noted that with Navan’s policy engine approving most expenses automatically, policy review was much more efficient, meaning that employees were reimbursed more quickly. The travel manager at the payment services organization said: “Previously, it was a desktop experience. Now with the mobile app, it’s a huge win. Employee satisfaction scores have increased from mid-seventies to around 90%.”

• Data visibility. Interviewees noted that finance teams and other administrators could easily and quickly find real-time data from a single dashboard. Because they no longer needed to access multiple systems and reconcile different sets of data, they saved time and quickly made decisions and updated policies as needed. The travel manager at the payment services organization explained: “Managers have a travel and expense dashboard, so they have access to more detailed and accurate data. The data is also easily formatted so they can easily see who’s complying, spend per person, and so on.”

Key Results Navan Expense

The results of the investment for the interviewees’ organizations include:

Productivity savings for both employees and finance administrators totaling $1.2 million. Finance administrators saved 40% of the time required to process and manage expense reports; in the case of the composite organization, this was equivalent to savings of four full time employees (FTEs). Employees also made significant time savings. Note that Forrester applies a productivity capture rate, given that not all time saved necessarily goes back to productive use; nevertheless even “unproductive” time savings are beneficial to employees who may be having to work out of hours. The global category manager at the life sciences organization said: “[Our previous expense system] wasn’t easy to use by any means. You’d almost need the manual to claim an expense. It was very difficult to use.” The travel manager at the payment services organization said: “We’re a team of four serving over 8,000 users. The additional time savings we are getting following the Expense implementation are invaluable.”

Savings from decommissioning expense management legacy tools of $20,000 annually. By implementing Navan Expense, tools used previously were no longer required, therefore helping the interviewees’ organizations avoid the related vendor fees and corresponding maintenance effort required to support them. One of the interviewees said their organization had multiple systems supporting different regions, some of which could be decommissioned. The extent of this benefit depends very much on the previous environment; those organizations that have no legacy tools will likely experience a higher productivity impact as they had to work manually with spreadsheets and communications applications.

Direct cost savings from Navan Expense totaling nearly $300,000 over the three-year period. Through tighter governance and better policy control, Navan Expense controls out-of-policy expenses, saving direct costs. Furthermore, Navan provided interviewees’ organizations a 1% rebate on all spending (US-issued Navan cards only). In the case of the composite, annual nontravel expenses come to $10 million, and with Navan Expense, this is reduced by 2%, enabling annual savings of $200,000. After risk adjustments and as a present value, this totals $300,000.