DaimlerChrysler is outsourcing back-office expense reporting support to TQ3 Travel Solutions in Germany, stepping up the traditionally limited role of travel management companies' involvement in processing expense reports.
DaimlerChrysler relies on TQ3 personnel at its service center in Stuttgart to assist the company with such back-office expense support as report auditing, compliance checks and expense report archiving maintenance—services generally not passed onto the TMC. However, DaimlerChrysler maintains a high-tech approach to processing reports throughout Europe via integration of the company's SAP expense module, its Amadeus-powered online booking tool, as well as its human resources system
(BTN, Feb. 10).The German arm of the company does not outsource its entire expense reporting process to its consolidated agency, but an internal team of DaimlerChrysler employees, as well as TQ3 agents at the service center work together to process expenses. "We are looking at every travel expense report, making a check that it is done by internal people with DaimlerChrysler and people from TQ3," said Bernd Burkhardt, DaimlerChrysler head of travel management Europe and the rest of the world.
He noted that while this is only in place in Germany, "Our colleagues in the U.S. have interest in putting in place a call center to add more support. The idea of implementing a service center through the agency with more than just booking functions is a growing concept in the business."
In general, the agency has become more hands-on with Daimler's travel practices in Germany, Burkhardt said: "They have a knowledge of our travel business, and they are part of the value chain. It leads to efficiency and process-cost reduction."
Kathie Lia, TQ3 director of technology marketing, said the agency is offering expense reporting support for several large clients in Europe but could not specify other organizations that outsource some or all of its expense reporting process to the agency.
Daimler's approach to include the agency in its T&E expense reporting processes defies the travel management company's traditional offerings, as the agency provides support and personnel.
"Typically, the travel management company is not too involved in the expense reporting process," said Earl Foster, president of Partnership Travel Consulting in Princeton, N.J. "They normally provide feeds to the company for reservations and things of that nature, and that's usually the extent."
In fact, TQ3 in the United States has followed the more traditional and less participatory format for dealing with clients' expense reporting workflow. Mike Peters, who heads U.S. expense reporting for TQ3, said that in addition to facilitating data feeds, TQ3's standard domestic practices involve working with companies to evaluate expense vendors, implement expense reporting systems and provide feedback on expense reporting policy and procedures. However, the level of service provided by TQ3 in Europe has exceeded these common TMC practices—something that Peters does not foresee catching on in the United States. In fact, it seems a higher level of expense reporting service is more ingrained in the European TMC tradition.
"In Europe, it's probably more of a trend because of the bigger complexities of European reimbursement laws," said Christa Degnan, adding that in general more stringent practices for reporting are required in certain European countries.
While TQ3's expense reporting support for DaimlerChrysler proves to be the exception rather than the rule, some companies have had this configuration in the past and others look forward to it in the future.
Consedis, which was a consulting and auditing arm of TUI Business Travel—a company that now is under the TQ3 fold—in the past provided auditing and expense support services to such clients in Europe as Deutsche Bank.
Cyndi Perper, global commodity manager for U.K.-based Invensys and a TQ3 client, this year is beginning to roll out a global expense reporting program and has her eye on implementing TQ3's services in applicable regions.
"The whole idea is that a lot of what we do requires basic help and to pay somebody to process all that stuff would be wonderful," Invensys' Perper said.
Meanwhile, through its expense reporting relationship with IBM, American Express said it can arrange for clients to outsource support for such expense-related functions as managing receipts, auditing, reviewing expense reports and analyzing spending trends.
Other such travel management companies as Carlson Wagonlit Travel said they compile data into reports for clients but do not offer the tedious back- office and auditing support.
Navigant International and Rosenbluth International follow this general level of service when it comes to expense reporting practices, providing more consultative support as opposed to hands-on support for expense management.
"We're part of the process," said Neville Teagarden, Navigant CIO. "What we typically find is that the auditing functions are usually tied into the implementation of an ERP system or an expense management system that the client already has in-house. All the financial processes around auditing those types of things are tied into that." Teagarden added expense reporting auditing and back-office support are not merely a travel function but cross into such other office disciplines as finance and human resources.
Navigant said it follows the traditional role of the TMC with regard to expense management by helping clients work through the bidding and implementation process, as well as designing expense policy.
While the outsourcing of expense reports is still an anomaly for corporate travel agencies, such expense reporting vendors as Fort Washington, Pa.-based Interplx Technologies and Eden Prairie, Minn.-based Gelco Expense Management offer clients hands-on services for managing expenses. Calling themselves "business service providers," these companies allow clients to outsource the back end of expense reporting to them.
"Expense reporting is not a core competency of most companies," said Richard Barnum, vice president of sales for Interplx Technologies. "We provide a real value-added process to those companies. We try to remove all the transaction processing from our clients so they don't have any of that to do anymore." Interplx's services include reimbursing employees, updating the general ledger, auditing reports, checking on travel compliance and managing expense reporting archives.
Barnum said that outsourcing this process to a third party results in a headcount reduction in a company's full-time equivalent staff, as well as more opportunity for a company to use its internal personnel to focus on its core competency.
Gelco also has enabled clients to completely outsource T&E expense processes, offering receipt and auditing management support, as well as payment and reimbursement services.