The old saying is that you have to spend money to make money. It certainly holds true in many cases, and it’s why a lot of businesses invest in spending management. This is where you take the idea of the accounts payable department and expand on what the company tracks and how it manages every payment that ultimately comes from the company coffers.

The irony of investing in spending management is that it costs money. Ultimately, you’re trying to save more money through efficient speed management than you spend on developing it. To do that, it helps to have a few focus areas and proven ideas. That’s where the five ideas below can help. They are common ways that companies improve spending management to benefit their bottom lines.

Procure to Pay

This is a rather specific way that many companies try to improve spending management. In essence, procure to pay combines purchasing resources with accounts payable to automate accounting inputs and tracking.

This empowers you to keep a closer eye on all spending in the company and everything attached to those numbers (such as analytics). Overall, procuring to pay helps keep spending within the company on a value-driven track that controls business costs.

Organize Payment Methods

It’s a pretty simple idea. If your payment methods are organized well, it’s easy to track spending. Simple enough, right? But, how do you actually organize payment methods?

More than a few strategies can work well, and not all of them will fit into this short section. One of the easiest and best examples is company credit cards. You can issue individual credit cards for company expenses with a company credit account. So, if someone has a per diem when they travel for business, they can make those purchases directly with the company card. By eliminating complicated reimbursement practices, spend management is easier and cheaper.

You can also look into consolidating expense accounts, organizing a central expense management team, and even designing an electronic payment tool that might work similarly to things like Apple Pay.

Audit

This is not the most fun word, but audits are often invaluable. A good spend management audit can look at how you track spending, how you analyze spending, how much you spend on spend management (always a fun paradox), and how you are specifically managing spending in the company.

These are specific areas where you can improve your management, functionality, and cost-to-value ratio for spending management resources. You can make sure your spend management is both working and monetarily valuable for the business.

Make Clear Rules

This is simple in concept and challenging in practice. A lot of spend management comes down to employee behaviors. When everyone is on the same page and on board with your spending policies, things go better for the company.

So, write out the rules and try to make them as sensible and easy to follow as possible. If you need some complicated rules, such as always reporting spending within 12 hours, try to provide automation tools. You can commission an expense app that makes it easy for employees to keep up with the reports you are demanding.

The easier it is for employees to do their part, the easier (and cheaper) it is for the company to manage spending.

Improve Visibility

This reflects on upper-level management. You have all of these resources for tracking expenses and performing analyses on them. None of that matters unless decision-makers can see the results. You have to have good visibility with your expense management tools.

It helps to centralize your data so that one expense report can summarize everything. It’s also worth investing in presentation tools that make it easy to see graphs and numbers that correctly portray your spending and what you can do at a managerial level. The visibility of your spend management is the final piece of the puzzle that makes your efforts worthwhile.

These five ideas can certainly help many businesses rethink spend management, but it’s hardly the limit of what is possible. You’ll find countless improvement opportunities when you carefully think about how you track and manage spending within the company. More importantly, as you refine your spend management, you’ll find that your company saves more money and derives more value from every dollar spent along the way.