Managing financial data was a nightmare for execs at Propark America, where more than 1,100 workers at 400 locations across 14 states submitted data manually — everything from handwritten timecards to spreadsheets of daily cash receipts.
“It was taking four to five days for our payroll department to manually re-enter each employee’s time and attendance data, then review and post entries,” said Tim Willey, CFO for Hartford-based Propark.
With an eye toward expansion, the parking lot management firm needed to find a way to streamline its inefficient and costly record-keeping process.
“There was no rest for the weary because they’d have to do it all over again the following week,” said Willey. “It was a real struggle to get payroll processed on time, not to mention getting our books closed at the end of the month and financial statements to our clients in a timely fashion.”
That’s why Propark turned to Realized Solutions Inc., a company that considers efficiency the holy grail of software innovation. RSI, founded in 2003, makes software that automates travel and expense reporting processes for small- and mid-sized companies. It has carved a niche developing customized solutions for clients in the education, financial, insurance, manufacturing and parking sectors.
It hasn’t always been easy. Between 2008 and 2009, RSI saw gross profits shrink by 5 percent. To compensate, John Beyer, RSI founder and company president, adjusted his budget, tightened the belt and shaved 11 percent off expenses.
The improvements in efficiency — including implementing the company’s own Travel and Expense program — helped reduced costs by 6 percent during the 2009 to 2010 period.
Meanwhile, gross profits rebounded with a 6 percent increase as the company doubled its 50 clients to 100. The private company expects to grow again this year.
“We expect a 10 percent increase in sales and new clients this year,” said Beyer. “Over the next three to five years, I expect that we’ll double again from where we are now.”
The company’s flagship product is the Travel and Expense processing software, which enables workers to collect, manage and share all their financial records, expense reporting payroll and reimbursements online.
RSI’s program works seamlessly with a company’s QuickBooks or MAS90 accounting system.
For Propark, that means managers at each location can submit data, scan receipts, request approvals and view information in real-time. All activity is reconciled at the local and corporate level instantly. The program also sends an automated message alerting management to review and approve a new transaction.
“By automating our payroll process, we’ve reduced errors, eliminated duplicate data entry and are saving the equivalent of half the salary of a full-time employee,” said Willey.
RSI charges a one-time $10,000 fee for system implementation, training and data conversion. After that, a client generally pays $10 to $15 per month per user.
The move paid off for Propark. The company cut its month-end closing process by 15 days and saved $60,000 a year in labor costs, according to Willey. Propark generates more than $50 million annually with major hotel, airport, restaurant and hospital clients and credits much of its growth to RSI.
RSI has plenty of competitors drawn to the growing market for software that automates employee processes. A Forrester Research Inc. study recently pegged the ROI for such products at around 242 percent over a three-year period.
What differentiates RSI from other companies is that it provides hardware and software, according to Beyer. RSI covers every aspect of IT project management from analysis, design and implementation to testing and training.
While the economic downturn forced many companies to slash their workforces and cut back on spending, Beyer said it fueled RSI’s growth as businesses looked for ways to streamline their operations to be more efficient and cost-effective.
In fact, the Travel and Expense program bolstered RSI’s bottom line in more ways than just one.
When Beyer saw how easy — and profitable — it was for his clients, he decided it was time to adopt the Travel and Expense system for his own company. He said the old manual, paper-based method was a headache for everyone.
“It was time to drink our own Kool-Aid,” said Beyer. “We can’t tell a client how to be efficient and organized without being efficient and organized ourselves.”
Under the old system, a dedicated RSI employee spent four days per week collecting information from 12 workers so they could reconcile accounts, verify charges, authorize reimbursements and issue invoices to vendors and clients.
“Handling financial data is difficult enough without having to spend all your time tracking people down to collect a piece of paper or verify a number,” said Beyer. “With the Travel and Expense program, you can see real-time information about your company and make smart financial decisions based on that.”
Now all employees enter their financial transactions in one program, which sends an e-mail alert to company leaders to review, approve and reconcile new transactions and activities.
What used to take each employee an average of two days per month to complete now takes an hour or two per week.
“We saved roughly 20 person hours per month, or $18,000 per year, and shortened the time to process expenses from a week to hours,” said Beyer. “Our workers invest the time in profit centers of our business. The system has essentially made us significantly more efficient.”
