P&G Selects Global T&E System

<B> P&G Selects Global T&E System</B>

By Cheryl Rosen

<I>Cincinnati</I> - Procter & Gamble today will announce a new contract that will bring a Lotus Notes-based expense reporting solution to more than 60,000 employees speaking 15 different languages in 66 countries.

The system is from Momentum Business Systems of Montreal, a relative newcomer targeting the Notes niche. The roster of customers using its Domino-based Boomerang system already includes such well-known names as Asea Brown Boveri, Bayer and Novartis.

P&G will be Momentum's biggest customer, and its first global one. "We will share some of the costs of the product and work with them on the design" of a truly global application, said P&G director of global finance systems Tim Biehle.

Momentum and P&G will spend the next six months building, testing and piloting the global version 4.0 before the official Boomerang rollout in May 2000. The plan is to bring 20 countries on board by July 2000 and the rest by 2003.

Choosing the first 20 countries will not be easy, though. "We have many interested candidates--our global core financial products are going out to 21 countries, and improvements in the travel process are needed in every region," Biehle said. "We've gotten tremendous response from travelers and also managers in all the different countries saying that this would be a huge help to them."

P&G expects the automated system to reduce the back-office processing staff--which processes half a million expense reports every year--by 40 to 60 percent, and to save travelers an average of 15 minutes per report, in part by prepopulating reports with data from global corporate card suppliers, Biehle said.

While he declined to cite exactly how much it costs P&G to process an expense report by hand versus an automated system, he said industry averages of about $35 and $4, respectively, "are generally about right, and P&G falls in between there."

The decision to automate expense reporting came as part of a huge global business services initiative to standardize the financial systems--including accounting, human resources, order management and information technology--of P&G units around the world. "We also wanted to make the expense reporting system easier for our travelers to use, and to integrate all the systems together, with an interface to SAP," Biehle said

While P&G did want to maximize its investment in Lotus Notes by adding applications, it did not overlook competing systems. Biehle and his team sent a request for proposals to about 10 suppliers of automated expense reporting systems, seeing demos of each and rating them on "a couple of pages worth of criteria." When no one appeared to have a truly global application, "we decided to partner with Momentum and develop something that met our legal, tax and language requirements," he said.

Momentum, meanwhile, has found that "travel expense management has become a runaway cost, the third largest behind salaries and benefits, and companies are looking to reduce that cost," said president Lorne Schwartz. "And our customers have already invested in deploying Domino for groupware and e-mail."

While declining to cite the exact price P&G is paying, Schwartz said that customers realize a quick return on their investment in the system--even at the full retail price of $5,000, plus $65 per license.

Asked to share a lesson learned on the long road to the current contract, Biehle said, "One thing we hadn't thought about a lot in the beginning of the RFP process, but we think is very important now, is to consider how this integrates with all the other systems in the company--the financial software and the software that's already on the traveler's desktop."

And indeed, Brian McDonough, research analyst for enterprise resource management applications at International Data Corp. of Framingham, Mass., agreed that's smart advice. Corporations already using Notes should at least consider the Domino solution for expense management, he said--and indeed, he suggested that it's a good idea to try to consolidate business systems in as few applications as possible.

Corporations buying an expense solution should "consider it as part of a broader self-service suite," McDonough said. "It doesn't make sense for people to be going to the corporate intranet to do procurement and then to another interface for expense reporting. As companies think about building more self-service applications for employees, it makes sense to send people to one interface, and to deliver all your administrative tasks through that one interface."

In addition, he noted, "the business rules for procurement are very similar to the business rules for expense reporting and for performance reviews, and you want to leverage those through a single application rather than managing many applications."

IDC estimated that software license and maintenance revenue for travel expense management applications will grow nearly five times by the year 2003, from the current $73 million to $334 million, McDonough said.