Contextual real-time data, not Advil, is helping CFOs solve lingering spend management headaches.
Flurries of payments and accompanying reports have kept chief financial officers on their toes for years. Still, Oded Zehavi, CEO at Mesh Payments, tells PYMNTS that the spend management landscape can be divided into two key periods: before COVID and after COVID.
“COVID pushed companies to move most of their infrastructure to the cloud, to a more standard stack supported by leading vendors,” Zehavi said.
He emphasizes that post-COVID, rather than having to wait one day, two days or even until the end of the month for payments data to reach spend management platforms to be audited for anomalies, businesses can now get the data and control expenses in real time — allowing them to define and proactively enforce policies without the need for human intervention along the way.
That is because today’s increasingly digital-first CFO stack lets finance teams do more with less by automating formerly laborious and repetitive tasks, freeing up their time to focus on more business-critical matters.
Real-time data exchange between the payment layer and spend management platforms can help finance teams take control of organizational spending and gain more insight into expenses.
“Historically,” Zehavi said, “everybody was talking about the end of the month — closing the books was a monthly ritual for finance teams … and they’ve been doing it for so many years that they have almost become addicted to [this monthly] process.”
Now, by leveraging the latest technology and the capabilities and improvements modern solutions provide, companies are moving to a model of “continuous accounting,” where they can close the books either the same day or in real time, he said.
For organizations of all sizes, accounting for and controlling the money they spend is mission-critical to driving growth.
With corporate travel and expenses on the rise once more, including transportation, meals, entertainment and gifts, all difficult categories for businesses to keep up with, there is a growing imperative for businesses to rethink their spend management and financial reporting solutions.
“Corporate travel is back after two year of zoom, but some people across finance teams have forgotten some of the challenges and needs,” Zehavi said. “Without real-time visibility and proper controls [around that spend], many companies are having a hard time keeping travel spend in-policy and on budget.”
That’s why he underscores that a real-time exchange between the payment data of an expense and the other sources that can place it contextually, whether from the IT side, the travel side, the HR side or another relevant source is so important.
“The convergence [of information] between different sources is the only way for advanced finance professionals to provide the real value that management expects them to provide to their organization,” Zehavi says.
Read more: Spend Management 2.0 Is Connected and Contextual
He tells PYMNTS the biggest benefit of digitizing finance operations is the big boost it can give to operational productivity.
“Everybody looks at productivity now as the key KPI for finance teams, [especially] as they shift from not only dealing with revenue to also making sure they’re controlling expenses — it’s critical for them to measure the productivity improvements they are getting [out of digital tools],” Zehavi said.
So why do 98% of businesses still use a tech stack without automation, synchronization and other modern features?
“The traditional [spend management] system is not just expensive, but takes a lot of time to implement — leaving finance teams with the impression that they will only see value six months, a year down the line,” Zehavi said.
Today, he noted, all of that has changed — a typical deployment of a modern spend management system can take as little as a few hours. With a variety of pricing structures to choose from, they are nowhere near as expensive as legacy systems using enterprise pricing models.
His advice for finance teams is not to try and achieve everything at once. “Start with your biggest expense,” Zehavi said, “prioritize your pain points and solve the first one — get to know the strength of the spend solution, then move to the next category, then the next.”