Time was when more than a few executives banked their salaries and lived off their corporate expenses. Not any more – such times are long gone.
The recognition that travel and associated expenses represent most organisations' second-largest controllable expense is driving the quest for the vast opportunities for savings that can be found through a properly defined and controlled expenses management system.
There is now an acknowledged need for comprehensive Management Information (MI) systems that can spot and highlight out-of-policy spend.
Diners Club's Global Vision MI tool provides spend information at the highest level yet can also drill down into subsidiary, cost centre, or individual cardholder spending data, highlighting non-compliance in class of travel, size of car rented or use of non-approved hotel chains. Some businesses are now only allowing so-called ‘revenue-producing travel'.
The use of low-cost airlines rather than scheduled carriers, the pro-active seeking of lower hotel rates and stricter control of the per diem spend related to meals and other services are all being targeted as means to lower overall costs.
Many of these controls now being put into place will certainly continue going forward as they represent sound business practice. Sooner or later the economy will pick up and business will regain its health. Companies will have to get their people back out on the road to meet customers but the present demand for increased control over expenses will not diminish.
The current situation is nothing new. Since World War II there has been a rolling cycle of recessions and recoveries. When it comes to business expenses, economically-driven changes have been seen at the time of the outbreak of both Gulf Wars, in the immediate post-9/11 period, and during the SARS outbreak.
What has changed dramatically is the reaction time, which has accelerated enormously thanks to improved MI systems that can direct management to where cuts can be made and steer them towards the stricter controls that can be put into place.
It's a vital element of succeeding in today's ever more competitive business world. Companies have been forced to trim waste, to get more from less.
Corporate travel and procurement departments have had to reduce staff and make more efficient use of technology.
This has driven Diners Club's increased number of joint projects with its clients, which aim to automate back office information feeds of card data into automated expense reporting tools and ERP systems.
Says Tom Edgerton: “Because of our global reach, ideas for improvement flow all the time from one country to another. What are emerging as ‘best practice' strategies, involve such things as improved client communication, better and more highly automated customer service and new tools for the cardholder and the programme administrator. We also get very useful feedback from our client meetings and forums that help us keep on track with where we should be going with our products and the associated technology.
“For our global clients, customer service is performed at both the headquarters and subsidiary level.
“This provides the local subsidiary with local product knowledge language support while providing the same information tools that all other subsidiaries of the company can access.”
It is certain that the strong trends, towards global consolidation of spend data across international companies, will continue apace. This will put them in a stronger position when it comes to negotiating vendor agreements with major airlines, hotel chains and car rental operators.
The need for businesses to have a consistent card programme across all the countries in which they operate will narrow the field as to which global expense management companies they can work with.
Diners Club's aim is to continually improve its products and services to ensure the client has a viable choice when considering changing from their current supplier to a different one or when planning the implementation of a new expense management programme.
Says Tom Edgerton: “We are in a state of constant evolution. The greatest challenge to us has always been in keeping up with the myriad regulatory changes that impact the services we offer. Taking on-board the suggestions of our clients, we have taken the tack of working directly with the regulators to anticipate these changes and keep ahead of them.”
The first credit card on the market – they launched in 1951 – and with more than 25 years of corporate credit card experience, Diners Club today can offer corporate payment solutions in more than 50 countries.
Adds Tom Edgerton: “We operate a Corporate Card programme that provides unmatched service from our dealings with the client's headquarters right down to individual cardholder level.
“Our set of services is consistent across all the countries in which we operate. With more than 100,000 multinational, corporate and SME clients we offer a truly global solution.”