When it comes to developing a commercial card program, knowledge is power - the power to make corporate spending as efficient and user-friendly as possible. A VISA commercial card program enables organizations of all sizes to improve their knowledge of their spending patterns - where they spend, who does the spending, what is bought and why. The "power" is the ability that this information provides to keep control over spending, to improve procurement processes and to increase corporate savings. With commercial cards utilized throughout the organization, as the foundation of a unified spending strategy, management receives data in real time and is able to act on that data to improve the in-house procurement process as well as supplier relationships beyond the four walls.

For any commercial card program to realize its full potential, the program goals have to be clear from the start and consistent across the entire organization. Centralized management support is vital. This means not just mandating card use for all buyers in the company, but the ongoing development and benchmarking of spending policies, strategic sourcing initiatives and user and administrator training. A strong management role is also required to communicate policy plans and details not only when a program is first launched but also on an ongoing basis thereafter. Direct senior management input is especially critical when new savings opportunities are identified and need to be acted on quickly. Management involvement also extends to the development of RFPs for new suppliers and renegotiation of existing contracts.

Finally, centralized program management makes the standardization of the program itself that much easier. "Standardization," however, does not mean a one-size-fits-all approach. No program, especially in medium to large-sized enterprises, will achieve its full potential unless its restrictions and requirements allow for 'local' departmental or business-unit variation. For example, one global enterprise that uses a VISA commercial card program has a set of minimum requirements for compliance with its spending policy, but that policy is adapted for each global region. In North America, the corporate leads in Finance and Procurement were directly involved in 'localizing' the policy and card program for that region. An understanding of local or business-unit restrictions and requirements is essential in achieving the greatest possible degree of user buy-in, regardless of whether card use is loosely enforced or vigorously mandated.

A policy that is developed and applied consistently can achieve much higher levels of end-user acceptance, and tends to be more effective than an approach where policy varies widely between different departments, business units or locales. It's important to reinforce the perception among users that the program policies are enforced fairly and management's expectations of card users remains consistent between different groups and business units. Regular communication to the user community can reinforce this perception, and provide a way to reward desirable spending behaviour.

A commercial card program runs on spending data. Consistent policy and centralized management enable that data to be gathered easily and immediately, beginning at the point of transaction and continuing with the submission of employee expense reports. A consistent policy can minimize unnecessary, accidental variety in the data collected, and allow program managers to establish uniform spending criteria and categories. This allows for easier generation of spending reports that are simpler and more easily understood by senior management - who may be directly responsible for the success of the program but probably don't need to know certain highly detailed and complex information that are of more value to line managers.

Broad market acceptance of an organization's commercial card is a prerequisite. Greater market acceptance and geographical reach mean that the commercial card program can be more flexible and adaptable. New spending and commodity categories can be added more easily, and greater competition can be fostered among vendors for the organization's business, which can give the organization a definite edge in negotiations. In the case of the global company referred to earlier, broad international acceptance is a real plus. Finally the uniformity of the program - even when it makes allowance for local and business-unit variances - is easier to maintain if the card in use is accepted across as many suppliers, commodities and geographies as possible.

The process of gathering the required spending data efficiently and quickly begins with the automation of data entry at the point of transaction and continues with the automated entry of expense reports by card users. A high degree of automation at these points keeps the information 'clean' when it enters the system, with amounts, authorization requirements, spend categories and other parameters registered correctly so that they don't have to be validated and possibly corrected later on. Financial audits of spending patterns are generally much easier, which means that a larger proportion of overall spending can be regularly scrutinized, and spending patterns can be kept on-track. Data entered automatically can be more easily integrated into the organization's back-end enterprise systems.

"Our employees receive their statements and fill out their expense reports online," says the Procurement Manager of one large enterprise that employs a VISA commercial card. "Then managers review the statements and submit them to Accounts Payable for payment. Finance audits 10 to 20 per cent of the reports, and sometimes they pick up on inappropriate spend." Measures such as merchant category code (MCC) blocking are also easy to implement, keeping users from spending outside policy parameters.

Organizations seeking a comprehensive view of commercial card spending can build the kind of detailed picture they require by integrating data gathered from multiple sources, such as e-procurement systems, vendors, back-end IT systems such as enterprise resource planning (ERP) software and purchasing card programs. Enterprises can assess what kinds of data to collect and aggregate by understanding the kinds of information available from Accounts Payable as well as from suppliers, other business partners and card issuers.

At a basic level, spend data can be consolidated with Access and Excel databases. With increased levels of automation, reporting tools can be used for accounts payable, G/L and purchase order reporting, and ultimately the organization can leverage the capabilities of a data mart or data warehouse. One participant in the Visa Procure-to-Pay Best Practices study implemented its commercial card program in order to capture data it wasn't getting on its procure-to-pay process. Another implemented procedures and systems to draw data from different sources so that it could develop a company-wide view of purchases.

If senior management mandates card use for all employees, the program can be very successful .' Maverick spend can be monitored , and spending can be directed through designated suppliers. This can ease the administrative burden and make the program much simpler to run.

Perhaps the greatest advantage to be gained by a detailed, accurate understanding of corporate spending lies in the leverage it can provide when it comes time to form new supplier relationships or renegotiate existing contracts. This information can be used to gain volume discounts, to consolidate the vendor base and to support fresh strategic sourcing initiatives. For truly forward-thinking organizations, this knowledge can form the basis of synergistic, cooperative sourcing programs undertaken with more advanced suppliers.