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Total Economic Impact
Cost Savings And Business Benefits Enabled By Travel and Expense Management
A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY Navan, November 2025
Total Economic Impact
A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY Navan, November 2025
Organizations with globally distributed teams and fragmented travel and expense (T&E) processes often face inefficiencies, policy noncompliance, and limited visibility into spend. These challenges drive up operational costs, degrade employee experience, and slow financial decision-making. Navan’s integrated travel and expense management platform reduces costs, improves compliance, and makes travel and expense processes easier and faster.
Navan offers a unified travel and expense management solution that streamlines booking, automates expense reporting, and enforces policy compliance in real time. The platform combines travel inventory, 24/7 assistance, corporate card functionality, and expense automation into a single interface, while also offering administrative capabilities, including advanced reporting, policy enforcement, and user management. These features were found to reduce administrative overhead and enhance visibility across the organization. Navan’s solution can scale globally, support duty of care, and enhance employee experiences.
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 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Navan travel and expense management on their organizations.
To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed five decision-makers with experience using Navan’s travel and expense management solution. For the purposes of this study, Forrester aggregated the experiences of the interviewees and combined the results into a single composite organization that is a global enterprise with $20 million annual travel budget and 5,000 employees, half of whom travel regularly.
Prior to using Navan, the interviewees described fragmented systems, manual processes, and poor user experiences that led to low adoption and policy noncompliance. Travel and expense management was decentralized with regional point solutions that lacked integration and scalability.
After the investment in Navan travel and expense management, the interviewees experienced improvements in operational efficiency, employee productivity, cost control, and employee satisfaction. The platform enabled faster travel bookings, automated expense processing, and better policy enforcement, which all contributed to measurable financial and strategic benefits.
Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:
Direct cost savings of $7.2 million from travel spend reduction and rebates. Navan’s negotiated rates, dynamic policy, and consolidated trip fee model enables savings of 16% on total travel spend for the composite organization. The platform also provides a 1% rebate on USD total travel spend, contributing to additional savings.
Productivity savings of $355,000 from streamlined travel booking and support. Travelers at the composite spend less time booking trips and managing itinerary, saving up to 10 mins per booking. Travel managers reduce time spent on coordination and reporting, freeing up 85% of their capacity.
Savings of $80,000 from decommissioning legacy tools. The composite organization eliminates licensing and maintenance costs associated with previous travel and expense platforms by consolidating onto the Navan platform.
Productivity gains of $1.2 million from expense management automation. Employees at the composite spend less time submitting expense reports, saving 24 minutes per report. Finance teams benefit from faster reconciliation and reporting, reducing manual effort and improving accuracy.
Direct cost savings of $300,000 from out-of-policy expense claims. Navan’s real-time policy enforcement prevents unauthorized spend and improves compliance across the composite organization. The platform also provides a 1% rebate on USD total expense spend for the composite, contributing to additional savings.
Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:
Improved policy compliance and duty of care. Navan’s real-time traveler tracking, automated alerts, and customizable approval flows enhance safety and oversight at the composite while reducing friction in policy enforcement.
Enhanced employee experience. Employees at the composite benefit from a wider inventory, mobile-first design, faster reimbursements, and no out-of-pocket payments, resulting in higher satisfaction and adoption across the organization.
Improved cash flow and sustainability tracking. Navan fronts travel costs and provides unified monthly billing for the composite organization, improving liquidity and simplifying reconciliation. The platform also supports sustainability initiatives through carbon emissions tracking.
Increased ease of use and strategic scalability. Navan’s interface and low learning curve reduce resistance, even among the composite’s long-tenured staff. The platform is future-ready and easily scalable across regions and entities.
Costs. Three-year, risk-adjusted PV costs for the composite organization include:
Navan platform fees of $1.2 million. These include trip-based fees for travel and user-based fees for expense management.
Implementation, training, and ongoing management costs of $714,000. Internal efforts include policy setup, employee onboarding, and support resources for managing Navan’s travel and expense solutions.
The financial analysis that is based on the interviews found that a composite organization experiences benefits of $9.1 million over three years versus costs of $1.9 million, adding up to a net present value (NPV) of $7.2 million and an ROI of 376%.
Average reduction in annual travel spend
Return on investment (ROI)
Benefits PV
Net present value (NPV)
Payback
| Ref. | Benefit | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|
| Atr | Direct cost savings with Navan travel | $2,890,000 | $2,890,000 | $2,890,000 | $8,670,000 | $7,187,002 |
| Btr | Productivity savings with Navan travel | $142,570 | $142,570 | $142,570 | $427,710 | $354,551 |
| Ctr | Savings from decommissioning legacy tools | $19,800 | $39,600 | $39,600 | $99,000 | $80,479 |
| Dtr | Productivity savings with Navan expense management | $0 | $738,720 | $738,720 | $1,477,440 | $1,165,524 |
| Etr | Direct cost savings with Navan expense management | $0 | $190,000 | $190,000 | $380,000 | $299,775 |
| Total benefits (risk-adjusted) | $3,052,370 | $4,000,890 | $4,000,890 | $11,054,150 | $9,087,331 |
Evidence and data. Interviewees highlighted that Navan delivered measurable cost savings through negotiated rates, dynamic policy enforcement, and a simplified trip-fee model. Prior to Navan, the interviewees’ organizations relied on fragmented TMCs and legacy booking tools, often paying higher transaction fees. The AVP of financial planning and analysis at a software development organization explained, “We were paying more in our prior solution — between 100% and 150% of what we pay Navan today.” With Navan, interviewees gained access to broader inventory, including New Distribution Capability (NDC) content and Online Travel Agency (OTA) rates, as well as negotiated discounts through Navan’s lodging collection. Interviewees also cited savings from the ability to apply dynamic policy controls and incentivize cost-conscious choices through rewards programs. Overall, interviewees reported savings of 15% to 20% on total travel spend for their organizations. This was the most important financial benefit for all the interviewees’ organizations and contributed to over 80% of the total benefits.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
The composite spends $20 million annually on travel.
Navan enables a 16% reduction in total travel spend through negotiated rates, broader inventory access, and dynamic policy-driven savings.
Navan offers a 1% rebate on total USD spend on travel.
Risks. The value of this benefit can vary across organizations due to differences in:
The extent to which negotiated rates and inventory are utilized.
The organization’s willingness to enable nonrefundable bookings or adjust policies.
The complexity of employee travel itineraries.
Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $7.2 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| A1 | Average number of annual travelers | Composite | 2,500 | 2,500 | 2,500 | |
| A2 | Average spend per traveler | Interviews | $8,000 | $8,000 | $8,000 | |
| A3 | Annual spend on travel | A1*A2 | $20,000,000 | $20,000,000 | $20,000,000 | |
| A4 | Average percentage savings on travel enabled by Navan | Interviews | 16% | 16% | 16% | |
| A5 | Subtotal: Reduction in travel spend enabled by Navan | A3*A4 | $3,200,000 | $3,200,000 | $3,200,000 | |
| A6 | Rebate rate for spending through Navan | Interviews | 1% | 1% | 1% | |
| A7 | Subtotal: Rebate on total travel spend through Navan | A3*A6 | $200,000 | $200,000 | $200,000 | |
| At | Direct cost savings with Navan travel | A5+A7 | $3,400,000 | $3,400,000 | $3,400,000 | |
| Risk adjustment | ↓15% | |||||
| Atr | Direct cost savings with Navan travel (risk-adjusted) | $2,890,000 | $2,890,000 | $2,890,000 | ||
| Three-year total: $8,670,000 | Three-year present value: $7,187,002 | |||||
Evidence and data. Interviewees consistently reported Navan improved productivity for both employees (end users) and travel managers. Prior to implementation, employees at the interviewees’ organizations often had to navigate multiple systems, contact travel agents, or book directly with suppliers. These manual workflows resulted in significant time spent on low-value administrative tasks, particularly for frequent travelers and internal support teams. Interviewees noted that with Navan’s intuitive interface, mobile accessibility and self-service capabilities employees were able to book travel in under 5 minutes compared to 15 to 20 minutes previously. With Navan, interviewees also reported measurable improvements in employee productivity, reduced administrative overhead, and increased ability for employees to focus on higher-value work. Interviewees added that prior to Navan, several travel managers spent up to 50% of their time coordinating and chasing items; after Navan a single travel manager spent 20% of their time, with the team redeployed to higher‑value work, such as strategic analysis and process improvement, rather than transactional tasks.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
The composite has 2,500 employees who travel regularly.
Each traveler books an average of seven trips per year.
Employees save 70% time per booking using Navan.
Travel managers save 85% time annually using Navan.
The average fully burdened annual salary for an employee is $93,600.
A productivity recapture rate of 50% is applied to reflect that not all time savings necessarily translate into business value for employees.
A productivity recapture rate of 75% is applied to reflect the portion of time savings that translates into business value for travel managers.
Risks. The value of this benefit can vary across organizations due to differences in:
The frequency of travel.
The complexity of employee travel itineraries.
The ability for employees to allocate time saved to other value-added activities.
The degree of policy automation and support model for travel managers.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $355,000.
Average travel booking time with Navan
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| B1 | Average number of annual users (travelers) | Composite | 2,500 | 2,500 | 2,500 | |
| B2 | Average number of trips per user (traveler) | Composite | 7 | 7 | 7 | |
| B3 | Annual number of trips by end users | B1*B2 | 17,500 | 17,500 | 17,500 | |
| B4 | Average time taken to book travel (hours/trip) | Interviews | 0.25 | 0.25 | 0.25 | |
| B5 | Percentage time saved with Navan | Interviews | 70% | 70% | 70% | |
| B6 | Fully burdened hourly rate for an FTE | Composite | $45 | $45 | $45 | |
| B7 | Productivity recapture rate | TEI methodology | 50% | 50% | 50% | |
| B8 | Subtotal: End-user productivity savings | B3*B4*B5*B6*B7 | $68,906 | $68,906 | $68,906 | |
| B9 | FTEs coordinating travel management | Interviews | 1.5 | 1.5 | 1.5 | |
| B10 | Percentage time saved with Navan | Interviews | 85% | 85% | 85% | |
| B11 | Fully burdened annual salary for an FTE | Composite | $93,600 | $93,600 | $93,600 | |
| B12 | Productivity recapture rate | TEI methodology | 75% | 75% | 75% | |
| B13 | Subtotal: Travel management FTE productivity savings | B9*B10*B11*B12 | $89,505 | $89,505 | $89,505 | |
| Bt | Productivity savings with Navan travel | B8+B13 | $158,411 | $158,411 | $158,411 | |
| Risk adjustment | ↓10% | |||||
| Btr | Productivity savings with Navan travel (risk-adjusted) | $142,570 | $142,570 | $142,570 | ||
| Three-year total: $427,710 | Three-year present value: $354,551 | |||||
Evidence and data. Interviewees reported that implementing Navan allowed their organizations to retire legacy, regional travel and expense management tools, which eliminated associated licensing and maintenance costs. Prior to Navan, the interviewees’ organizations often relied on multiple point solutions and region-specific TMC platforms, which created fragmented workflows and additional overhead. After adopting Navan, interviewees’ organizations were able to consolidate travel and expense into a single platform, eliminating the need for multiple vendors and tools.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
Annual license cost for both the legacy travel management solution and the expense management solution was $20,000 each.
Maintenance overhead associated with both legacy tools was 10%.
Navan’s implementation enables the full decommissioning of these tools starting in Year 1 for travel and Year 2 for expense.
Risks. The value of this benefit can vary across organizations due to differences in:
The number and type of legacy systems in use prior to Navan.
Contractual obligations or early termination fees for legacy vendors.
The timing of Navan deployment and whether expense management is implemented concurrently with travel.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $80,000.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| C1 | License cost associated with legacy travel management platform | Interviews | $20,000 | $20,000 | $20,000 | |
| C2 | License cost associated with legacy expense management platform | Composite | $0 | $20,000 | $20,000 | |
| C3 | Additional cost associated with maintenance | Composite | 10% | 10% | 10% | |
| Ct | Savings from decommissioning legacy tools | (C1+C2)*(1+C3) | $22,000 | $44,000 | $44,000 | |
| Risk adjustment | ↓10% | |||||
| Ctr | Savings from decommissioning legacy tools (risk-adjusted) | $19,800 | $39,600 | $39,600 | ||
| Three-year total: $99,000 | Three-year present value: $80,479 | |||||
Evidence and data. Interviewees reported that Navan’s expense management solution significantly reduced the time employees and finance teams spent on manual expense reporting and reconciliation. According to interviewees, prior to Navan, employees had to retain receipts, manually enter data, and wait weeks for reimbursement. The global category manager at a life sciences organization noted, “Employees do not submit expense reports anymore,” highlighting the productivity benefits from Navan. Prior to Navan, finance teams at the interviewees’ organizations also spent considerable time reviewing receipts, chasing missing documentation, and processing reimbursements. After Navan, these finance teams saw a notable drop in time spent on auditing and reconciliation. These improvements allowed both employees and finance staff to reallocate time to higher-value activities.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
The expense management solution is rolled out in Year 2.
Each employee submits an average of 12 expense reports per year.
Employees save 80% time per submission using Navan.
Finance teams save 40% time annually on expense auditing and reconciliation.
The average fully burdened annual salary for an employee is $93,600.
A productivity recapture rate of 50% is applied: not all time saved necessarily translates into business value for employees.
A productivity recapture rate of 75% is applied to reflect the portion of time savings that translates into business value for expense managers.
Risks. The value of this benefit can vary across organizations due to differences in:
Complexity of expense policies and approval workflows.
The organization’s ability to reallocate time saved to other value-added activities.
The degree of automation and policy enforcement prior to Navan.
Integration with ERP systems and reimbursement workflows.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $1.2 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| D1 | Annual users | Interviews | 5,000 | 5,000 | ||
| D2 | Average number of expense reports submitted by employee | Composite | 12 | 12 | ||
| D3 | Average time taken to submit expense report | Interviews | 0.50 | 0.50 | ||
| D4 | Percentage time saved with Navan | Composite | 80% | 80% | ||
| D5 | Fully burdened hourly rate for an FTE | Composite | $45 | $45 | ||
| D6 | Productivity recapture rate | TEI methodology | 50% | 50% | ||
| D7 | Subtotal: End-user productivity savings | D1*D2*D3*D4*D5*D6 | $540,000 | $540,000 | ||
| D8 | FTEs involved in expense reconciliation and processing | Interviews | 10 | 10 | ||
| D9 | Percentage time saved with Navan | Interviews | 40% | 40% | ||
| D10 | Fully burdened annual salary for an FTE | Composite | $93,600 | $93,600 | ||
| D11 | Productivity recapture rate | TEI methodology | 75% | 75% | ||
| D12 | Subtotal: Expense management FTE productivity savings | D8*D9*D10*D11 | $280,800 | $280,800 | ||
| Dt | Productivity savings with Navan expense management | D7+D12 | $0 | $820,800 | $820,800 | |
| Risk adjustment | ↓10% | |||||
| Dtr | Productivity savings with Navan expense management (risk-adjusted) | $0 | $738,720 | $738,720 | ||
| Three-year total: $1,477,440 | Three-year present value: $1,165,524 | |||||
Evidence and data. Interviewees reported that Navan’s expense management solution reduced out-of-policy spend and improved compliance through real-time policy enforcement and integrated controls. Prior to Navan, interviewees’ organizations lacked visibility into expense claims, making it difficult to prevent unauthorized or noncompliant spending. The AVP of financial planning and analysis at a software development organization noted that Navan’s dynamic policy and traffic light alerts helped steer employees toward compliant choices before expenses were incurred. Interviewees also highlighted the benefits of integrated corporate card programs, which enforced policy at the point of transaction, reducing leakage and fraudulent claims. These capabilities collectively helped the interviewees’ organizations avoid unnecessary costs and maintain tighter control over budgets.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
The composite spends $10 million annually on nontravel expenses.
Navan prevents 1% of out-of-policy expense claims, representing avoided leakage.
Navan offers 1% rebate on total USD spend on expenses.
Risks. The value of this benefit can vary across organizations due to differences in:
Annual spend on nontravel expenses.
Adoption of Navan’s corporate card and real-time policy enforcement features.
Organizational compliance culture and enforcement rigor.
Results. To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $300,000.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| E1 | Annual spend on nontravel expenses | Assumption | $10,000,000 | $10,000,000 | ||
| E2 | Leakage prevented from preventing out-of-policy expense claims | Assumption | 1% | 1% | ||
| E3 | Rebate rate for spending through Navan | Interview | 1% | 1% | ||
| Et | Direct cost savings with Navan expense management | (E1*E2)+(E1*E3) | $0 | $200,000 | $200,000 | |
| Risk adjustment | ↓5% | |||||
| Etr | Direct cost savings with Navan expense management (risk-adjusted) | $0 | $190,000 | $190,000 | ||
| Three-year total: $380,000 | Three-year present value: $299,775 | |||||
Interviewees mentioned the following additional benefits that their organizations experienced but were not able to quantify:
Improved policy compliance and duty of care. Interviewees consistently highlighted Navan’s ability to enforce policy in real time and improve compliance across the organization. The AVP of financial planning and analysis at a software development organization explained, “We think about policy enforcement with a goal of risk reduction as well as compliance with policy to stay within the cost.” They added that Navan’s dynamic policy engine, traffic-light alerts, and integrated card controls helped prevent out-of-policy bookings before they occurred. Interviewees also noted duty of care improved significantly with Navan. Real-time traveler tracking and automated alerts enabled the interviewees’ organizations to locate and communicate with employees in the event of disruptions or emergencies. The global category manager at a life sciences organization shared: “Previously, if there was an emergency, we had no way of telling who was where. … Now, we can run a report and send alerts instantly.”
Enhanced employee experience. Interviewees emphasized that Navan improved how employees interact with travel and expense processes. Before Navan, employees at the interviewees’ organizations faced fragmented systems, manual workflows, and long reimbursement cycles, which created frustration and reduced productivity. According to interviewees, Navan’s consumer-grade design and mobile-first approach gave employees control and flexibility, allowing them to book travel in minutes, manage itineraries on the go, and access 24/7 support. This shift reduced stress, improved confidence in compliance, and boosted overall satisfaction. Interviewees shared their employees loved the ability to manage everything in one place — travel, expense, and support — without switching between tools. The business transformation manager at a consumer goods organization noted added, “We anticipated a lot of pushback, but adoption was high because the system feels like consumer-grade tech.”
Improved cash flow and sustainability tracking. Interviewees also highlighted that Navan improved liquidity by fronting travel costs and consolidating billing into a single monthly statement. The global category manager at a life sciences organization noted, “They reimburse our employees, and we only pay Navan once a month … improving our cash flow.” This eliminated the need for employees to carry costs and simplified reconciliation for finance teams. Additionally, Navan supported sustainability initiatives at the interviewees’ organizations by tracking carbon emissions and providing visibility into environmental impact. The interviewee also explained: “We needed to know our baseline for net-zero targets. … Navan allowed us to capture CO₂ data we couldn’t track before.”
Increased ease of use and strategic scalability. Interviewees praised Navan’s intuitive interface and low learning curve, which minimized training requirements and accelerated adoption across regions. Beyond usability, the interviewees said their organizations valued Navan’s ability to scale globally and integrate seamlessly with HR and ERP systems, supporting evolving needs without major disruption. The business transformation manager at a consumer goods organization noted: “The learning curve for the end user was very low. … Adoption was high from the beginning because the platform is intuitive.” Another interviewee highlighted: “We rolled out in phases across multiple regions. … The platform is future-ready and easily scalable.” Navan’s flexibility to add modules, such as expense management after travel deployment, was cited by the interviewees as a key advantage for long-term strategy. Interviewees also valued Navan’s flexibility to support evolving needs, such as adding expense management after travel deployment without major disruption.
The value of flexibility is unique to each customer. There are a number of scenarios in which a customer might implement Navan travel and expense management and later realize additional uses and business opportunities, including:
Modular deployment and expansion. Interviewees stated that Navan’s architecture supports phased adoption, allowing their organizations to start with travel management and later add expense management, corporate cards, or advanced analytics without reimplementation disruptions. They said that this modular approach reduced risk, accelerated time to value, and aligned with organizational readiness. This meant the interviewees’ organizations could roll out core travel capabilities first then layer on expense automation or AI-driven features as priorities evolve, avoiding the “big bang” risk of legacy systems.
Integration with enterprise systems. According to interviewees, Navan offered prebuilt integrations with leading ERP and human resources information system (HRIS) platforms, enabling automated user provisioning, real-time expense coding, and seamless financial reconciliation. These integrations reduced manual work, improved data accuracy, and future-proofed the interviewees’ organizations during ERP migrations or consolidations. This meant the interviewees’ organizations’ finance teams gained real-time visibility into spend, accelerated month-end close, and eliminated error-prone manual uploads.
Adaptability to policy and market changes. Interviewees reported that Navan’s dynamic policy engine allowed their organizations to adjust travel and expense rules instantly by role, location, or seasonality — all without IT intervention. The interviewees’ organizations could enforce sustainability goals, adjust per diems, or enable cost-saving measures like nonrefundable hotel bookings in real time. This meant the interviewees’ businesses could respond quickly to market volatility, inflation, or internal policy shifts without disrupting the user experience.
| Ref. | Cost | Initial | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|---|
| Ftr | Navan travel and expense fees | $0 | $441,000 | $504,000 | $504,000 | $1,449,000 | $1,196,101 |
| Gtr | Cost of implementation, training, and ongoing management | $251,370 | $255,906 | $149,121 | $141,561 | $797,958 | $713,609 |
| Total costs (risk-adjusted) | $251,370 | $696,906 | $653,121 | $645,561 | $2,246,958 | $1,909,710 |
Evidence and data. Interviewees noted Navan’s pricing model is based on trip fees for travel and user-based fees for expense management. They also highlighted that the simplified trip-fee model resulted in more predictable costs. The interviewees said their organizations also appreciated that Navan bundled implementation and support into the subscription, avoiding additional setup charges.
Because Navan fees vary based on organization-specific factors, consult with Navan for pricing specific to your organization when conducting your own analysis
Modeling and assumptions. For the composite organization, Forrester assumes the following:
Navan charges trip-based fees for travel and user-based fees for expense management.
Expense management fees begin in Year 2 and apply to 5,000 users.
Navan’s pricing includes implementation and support at no extra cost.
Risks. The cost of Navan travel and expense fees may vary due to:
Differences in pricing and contract terms.
Variability in travel volume and adoption of expense management.
Optional add-ons.
Results. To account for these risks, Forrester adjusted this cost upward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $1.2 million.
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| F1 | Navan travel fees | Interviews | $420,000 | $420,000 | $420,000 | |
| F2 | Navan expense fees | Interviews | $60,000 | $60,000 | ||
| Ft | Navan travel and expense fees | F1+F2 | $0 | $420,000 | $480,000 | $480,000 |
| Risk adjustment | ↑5% | |||||
| Ftr | Navan travel and expense fees (risk-adjusted) | $0 | $441,000 | $504,000 | $504,000 | |
| Three-year total: $1,449,000 | Three-year present value: $1,196,101 | |||||
Evidence and data. Interviewees described Navan’s implementation as relatively light touch but requiring internal coordination for policy setup, HRIS integration, and change management. The implementation journey typically included a pilot followed by a phased rollout. The business transformation manager at a consumer goods organization explained, “We did a pilot test first with heavy travelers … then a full rollout with live sessions and recorded training.” Interviewees whose organizations lacked unified travel policy said the initial internal efforts spent during implementation were primarily concentrated on internal alignment to define their global travel and expense policies and then training programs for users, which was also supported by Navan. Ongoing management involved minimal FTE allocation for travel and expense program oversight.
Modeling and assumptions. For the composite organization, Forrester assumes the following:
Initial implementation of travel management solution involves 320 hours of internal effort for developing travel policies, policy configuration, testing integrations, and training materials development.
Implementation of expense management solution involves 160 hours of internal effort and coordination.
Training includes 1 hour per employee for all 5,000 employees in the initial implementation period and Year 1.
There is an employee turnover rate of 10%. Because of this, 500 new employees require training for 1 hour each in Years 2 and 3.
The average fully burdened annual salary for an employee is $93,600.
Risks. The cost of implementation and ongoing management may vary due to:
Complexity of policy configuration and number of integrations.
Geographic scope and phased rollout approach.
Internal resource availability and change management requirements.
Results. To account for these risks, Forrester adjusted this cost upward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $714,000.
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| G1 | Hours of internal efforts toward implementation of Navan | Interviews | 320 | 0 | 160 | 0 |
| G2 | Fully burdened hourly rate for an internal FTE | Composite | $45 | $45 | $45 | $45 |
| G3 | Hours of training per employee | Interviews | 1 | 1 | 1 | 1 |
| G4 | Employees receiving training | Composite | 5,000 | 5,000 | 500 | 500 |
| G5 | FTEs involved in ongoing travel and expense management | Interviews | 0.0 | 0.2 | 1.2 | 1.2 |
| Gt | Cost of implementation, training, and ongoing management | (G1*G2)+(G2*G3*G4)+(G5*G2*2,080) | $239,400 | $243,720 | $142,020 | $134,820 |
| Risk adjustment | ↑5% | |||||
| Gtr | Cost of implementation, training, and ongoing management (risk-adjusted) | $251,370 | $255,906 | $149,121 | $141,561 | |
| Three-year total: $797,958 | Three-year present value: $713,609 | |||||
| Initial | Year 1 | Year 2 | Year 3 | Total | Present Value | |
|---|---|---|---|---|---|---|
| Total costs | ($251,370) | ($696,906) | ($653,121) | ($645,561) | ($2,246,958) | ($1,909,710) |
| Total benefits | $0 | $3,052,370 | $4,000,890 | $4,000,890 | $11,054,150 | $9,087,331 |
| Net benefits | ($251,370) | $2,355,464 | $3,347,769 | $3,355,329 | $8,807,192 | $7,177,621 |
| ROI | 376% | |||||
| Payback | <6 months |
The financial results calculated in the Benefits and Costs sections can be used to determine the ROI, NPV, and payback period for the composite organization’s investment. Forrester assumes a yearly discount rate of 10% for this analysis.
These risk-adjusted ROI, NPV, and payback period values are determined by applying risk-adjustment factors to the unadjusted results in each Benefit and Cost section.
The initial investment column contains costs incurred at “time 0” or at the beginning of Year 1 that are not discounted. All other cash flows are discounted using the discount rate at the end of the year. PV calculations are calculated for each total cost and benefit estimate. NPV calculations in the summary tables are the sum of the initial investment and the discounted cash flows in each year. Sums and present value calculations of the Total Benefits, Total Costs, and Cash Flow tables may not exactly add up, as some rounding may occur.
From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment in Navan travel and expense management.
The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Forrester took a multistep approach to evaluate the impact that Navan travel and expense management can have on an organization.
Interviewed Navan stakeholders and Forrester analysts to gather data relative to Navan travel and expense management.
Interviewed five decision-makers at organizations using Navan travel and expense management to obtain data about costs, benefits, and risks.
Designed a composite organization based on characteristics of the interviewees’ organizations.
Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewees.
Employed four fundamental elements of TEI in modeling the investment impact: benefits, costs, flexibility, and risks. Given the increasing sophistication of ROI analyses related to IT investments, Forrester’s TEI methodology provides a complete picture of the total economic impact of purchase decisions. Please see Appendix A for additional information on the TEI methodology.
Benefits represent the value the solution delivers to the business. The TEI methodology places equal weight on the measure of benefits and costs, allowing for a full examination of the solution’s effect on the entire organization.
Costs comprise all expenses necessary to deliver the proposed value, or benefits, of the solution. The methodology captures implementation and ongoing costs associated with the solution.
Flexibility represents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. The ability to capture that benefit has a PV that can be estimated.
Risks measure the uncertainty of benefit and cost estimates given: 1) the likelihood that estimates will meet original projections and 2) the likelihood that estimates will be tracked over time. TEI risk factors are based on “triangular distribution.”
The present or current value of (discounted) cost and benefit estimates given at an interest rate (the discount rate). The PV of costs and benefits feed into the total NPV of cash flows.
The present or current value of (discounted) future net cash flows given an interest rate (the discount rate). A positive project NPV normally indicates that the investment should be made unless other projects have higher NPVs.
A project’s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits less costs) by costs.
The interest rate used in cash flow analysis to take into account the time value of money. Organizations typically use discount rates between 8% and 16%.
The breakeven point for an investment. This is the point in time at which net benefits (benefits minus costs) equal initial investment or cost.
Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists solution providers in communicating their value proposition to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of business and technology initiatives to both senior management and other key stakeholders.
1 Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists solution providers in communicating their value proposition to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of business and technology initiatives to both senior management and other key stakeholders.
Readers should be aware of the following:
This study is commissioned by Navan and delivered by Forrester Consulting. It is not meant to be used as a competitive analysis.
Forrester makes no assumptions as to the potential ROI that other organizations will receive. Forrester strongly advises that readers use their own estimates within the framework provided in the study to determine the appropriateness of an investment in Navan travel and expense management.
Navan reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester’s findings or obscure the meaning of the study.
Navan provided the customer names for the interviews but did not participate in the interviews.
Bharath Sivan
Jan Sythoff
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© Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies.
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