Welcome to my third installment of tips for a successful visit to HITEC 2021.  Today, I want to focus on expense management systems (EMS). These include applications for
  • time and attendance,
  • cost of goods sold tracking (food, beverage, retail, services),
  • other expenses (purchase orders),
  • and equipment maintenance, travel and entertainment, etc.
 
These applications are heavily used by department heads and accounting but should be of interest to the entire leadership team.  Controlling expenses, combined with optimizing revenues, is the path to maximizing profits. 
 
Labor expense represents the largest class of controllable expenses in most hospitality enterprises, followed by F&B cost of goods, and other operating expenses.  The applications available today for each of these cost centers offer a variety of features, with the overwhelming majority being cloud-based.  I will focus on each of these top three areas and where I see the current state of solutions. The availability of financial and statistical data from your revenue systems (RMS) is critical to the effectiveness of most expense management applications. 
 
Today, time and attendance applications have matured into complex workforce management systems (WMS).  They involve establishing labor staffing standards based on volume measurements (arrivals, room nights, guests served, etc.) for each job position in a department.  These staffing standards cover fixed and variable positions with updated payrates from HRIS.
 
You want to look for a WMS that offers several key features:
  • Staffing standards for each job actively linked with pay rates.
  • Integration with PMS, POS, and S&C to handle data exchange of forecasted and actual business volumes.
  • Reporting of actual versus forecast and actual versus standard.
  • Create weekly schedule using forecasted business volumes and staffing standards.
  • Mobile technology available to managers and staff to expedite shift swaps and requests for time off.

One last thought about time and attendance in today’s world.  With the use of geofencing technology, you can enable staff to clock in with their smartphones.  No more timeclocks needed!
 
Cost of goods tracking applications for food, beverage, retail, etc. have been around for years.  Most of these applications include features for inventory management to track items from the loading dock, through storerooms, and to their final destination for prep and sale.  This tracking allows managers to compare physical inventory counts against a perpetual inventory.  Variances are indicators of inventory shrinkage (theft).
 
The more sophisticated applications should include many of the following features:
  • Electronic vendor price updates for requisitions, POs, and inventory value.
  • Integration with daily sales from POS and S&C.
  • Electronic recipes linked dynamically to raw product pricing.
  • Cost tracking by revenue center, especially in centralized kitchens.
  • Inventory counts using scanners.
  • Reporting covering dead stock, product velocity, perpetual inventories, potential costs, and menu engineering.
 
 
Controlling other operating expenses is best handled using purchase orders.  If you already use an application for cost of goods tracking and inventory management, there is a good chance it is already equipped to handle purchase orders.  Purchase orders allow for advanced approval of expenditures rather than old-school invoice approval.
 
Purchase order applications should exchange data directly with accounts payable.  Here are a few more key requirements you should look for:
  • All approvals are handled electronically with built-in workflow (usually via email).
  • Controls using monthly budget or forecast with declining balances (checkbooks).
  • Electronic receiving records.
  • Invoice payments require PO match and receiving record.
  • Reporting for partially received POs, pricing variances, monthly accruals for items received but not invoiced.
 
You may already have a solution in place for controlling one or all these expense areas that meets your needs.  Don’t let that stop you from evaluating the competition.  If you see something you like with a different vendor, you can immediately make a beeline for your current vendor.  You might find out the feature is already included in your installation. 
 
The opportunity to see your vendors in person, as well as their direct competitors, is one of the true value-add propositions for attending HITEC 2021.  Surely by now you have lined up a team to come with you.  Registration is still open online.  And if it is your first time attending, you will be amazed at the variety of vendor-sponsored events each evening after the show closes.