Recent research conducted by AppZen into employee spend management trends during the COVID pandemic highlighted several challenges faced by organizations. These challenges ranged from the relatively trivial lack of clarity around allowable work from home expenses to a more sinister discrepancy between male versus female compensation satisfaction in remote employees.
Full details of the findings can be found in the report, but [spoiler alert] most of the challenges resulted from a lack of action or, to be more precise, a lack of proactive steps to adapt to the changing situation presented by the pandemic.
What resulted from such a lack of agility is a series of straightforward recommendations for organizations;
- To put things right,
- To re-engage with their workforce,
- And to build a repeatable structure for managing expenses and change moving forward.
Embrace work from home expenses
Expense types have changed as a result of working from home. Employees are not claiming classic travel and entertainment (T&E) expenses – but are claiming new types of work from home related expenses. These include one-off items such as office chairs, external monitors, and desks; subscription costs such as internet usage; and COVID-specific items like hand-sanitizer and face masks.
Many organizations were slow to adapt expense policies to embrace this change – but adapt they must. The new policies need to be transparent, fair, and configured in a software system that can apply them the second they are activated.
Communicate updated policies – proactively and regularly
With shiny new expense policies in place, organizations can proactively communicate the changes and, of equal importance, why such changes are occurring. These communications should be as visible and personal as possible – webinars or video meetings are ideal in this situation.
But communication should not stop after the initial flurry of activity. Reinforcement of the new policy rules and regulations is essential for ensuring full understanding and compliance around expenses. The AppZen research found that by updating their expense policies and clearly communicating the changes, organizations’ alignment with employees was much stronger during the COVID months. Those businesses that did not adapt policies had confused and disenfranchised employees.
Listen to employee concerns
The research raised numerous unexpected nuances. From a perception that senior executives are getting preferential treatment to women feeling less well compensated for work from home expenses, these nuances raise more questions than they answer. And these are questions that organizations can only truly understand by talking to staff.
CFO’s understand the cost of perpetuating harmful industry and societal practices. This can cost the company valuable employees and put the company at risk of blowback. Through analytics and rapid adaptability, finance leaders are equipped to change these practices and therefore the overall health of the business.
In addition, organizations should create a regular cadence for feedback from staff. This ongoing dialogue should be at least quarterly and involve both the finance team and leaders from within the business. By actively eliciting details of employee concerns, the organization can continually develop and refine policies that fairly compensate employees for out-of-pocket expenses.
Rinse and repeat
Many people believed that the COVID pandemic would be over and done quickly. However, we are now well over six months into seeing global disruption with no clear end in sight. But one thing is clear – we will continue to need to adapt and proactively respond to further changes in the future, whether from COVID, political instability, climate change, or something completely different.
Creating new and responsive work from home policies, communicating them, and getting staff feedback on them is a great start – but it is just a start. The feedback and learnings from that first execution of the process need to be fed back into the process as inputs to a second, third, fourth pass. We need to treat change as an ongoing project and adopt a “rinse and repeat” mentality to deal with whatever the world throws at us.
Employee expense management is proving to be an insightful lens on corporate and employee behavior. Earlier in the year, AppZen highlighted how corporate culture and expense management are closely linked. Now, detailed research shows that proactive expense management during COVID has driven a significant uptick in employee engagement versus organizations less proactive.
The current pandemic and global situation are not slowing the charge towards AI-enabled automation and touchless expense processing. Quite the opposite – they provide active vindication for technology use to improve employee expense management within the enterprise.
To learn more, download the work from home survey report.