Automation is dramatically impacting businesses of all types – from cybersecurity, to healthcare, to agriculture. As technology shifts many of the tasks workers perform daily from manual processes to automated processes, businesses are able to become more efficient and better at helping employees to reach their full potential.
Companies with large mobile workforces should be no different, but too often we see businesses resigned to old habits, leaving their drivers to use antiquated manual mileage tracking methods. While introducing new technology can seem like a mountainous hurdle, here are four fundamental arguments you need to weigh when considering automated mileage tracking:
1. Time Savings
To any business, time is money – both are precious commodities. But looking at the inefficiency of some mileage tracking programs, its easy to see the massive amounts of both being wasted on manual entry. The time it takes a driver to manually record the date, location, distance and purpose for each of their stops can add up quickly.
Consider this: if your drivers spend just 12 minutes a day manually tracking their mileage, that equates to a full hour of work in one week, or 52 hours a year. That’s more than a full week’s worth of work spent on basic data entry alone. In driving time, that equates to an additional trip from New York City to Seattle for each employee, with another ten hours to spare. Or, you could add a week of vacation for each driver – and they would still have time to drive from New York to Chicago on saved data entry time. Beyond that, managers also end up investing time in the process as they receive and approve reports from each driver. All of that is time that could be better spent elsewhere.
2. Better Log Accuracy
There are four things every business driver needs to track in order to keep an IRS-compliant mileage log: the date, destination, exact distance between two business stops and the purpose of the trip (which is the most commonly forgotten element).
Realistically, drivers don’t always take the time – or remember – to log each of these elements between every business stop. More often than not, they are recalled retroactively, at the end of the week at best. When this occurs, the hardest part to get right is typically the location and distance. It’s fairly easy for drivers to remember general directions to their usual stops, but much more difficult to remember the exact location. While looking up the same address each time can feel repetitive, making a mistake when trying to recall a location from memory can lead to an inaccurate log. Distance is also easy to mistakenly distort – many drivers estimate or round their mileage which dilutes the accuracy, or even forget about some trips entirely.
3. Correct Commute Deductions
Commute deductions are complicated. In fact, the nuances are far too many to go into here, suffice to say that most drivers are not utilizing them effectively. As an example, one common mistake drivers make is counting their commute to work and home again as business mileage. This usually should not be considered a business trip. However, if that same driver makes a stop along the way at a temporary work location – somewhere they’ll be working from for less than a year – and then continues on to their permanent office, then every commute mile is reimbursable. Manual mileage logs do not ensure the proper application of the necessary commute type in a bevy of unique and dynamic situations, and can overstate reimbursable (or tax-deductible) mileage.
4. Increased Business Visibility
Non-fixed expenses such as mileage reimbursements are liabilities for businesses, particularly as we work to predict expenses and plan budgets months, quarters or even years ahead. Data from manual mileage logs can be tracked and graphed manually, but in today’s technology-driven world, where global markets can shift from minute to minute, being able to calculate expenses on-demand is incredibly valuable. By tracking business driving trends more effectively, we can also analyze expense patterns, anticipate how much money will be spent each month and project how much total mileage reimbursement will be paid out over the course of a year. This level of business insight can give managers and executives a leg up when it comes to competitive strategy.
In the end, the shift to automated mileage tracking technology has resulted in one major opportunity – peace of mind for both businesses and their drivers. Worrying less about data entry and administrative tasks, we are further able to see the big picture and dedicate our thoughts and time to actions that will impact the bottom line. The generation of manual mileage logs is soon becoming obsolete, and for good reason.