Every successful company needs to grow. And this process requires it to track capital expenditures, especially those which create future benefits. A very important part of tracking capital expenditures is the approval part. Over the past 30 years CapEx tracking has come a long way literally from the Stone Age era to flying planes. What has changed? Let’s make an excursion along an imaginary museum of CapEx process management evolution.
Let’s fantasize a little – the head of your marketing department, John Smith comes to your accountant, Mary Longhorn, and asks for money to buy a video camera. And Mary gladly accepts his request and grants him $5000 from the budget. Do you think it is a good, real-life example? I doubt it…
Paper Era
In real life, before Mary gets the money out of the budget, the camera purchase must be approved by one or several company employees. How does it look in real life? Let’s start from practice, which was standard about 20 years ago.
John Smith fills in a paper (with his ink pen), in which he writes the purpose for the purchase – “filming commercials for our marketing campaigns”, amount of capital expenditure ($5000) and estimated date of purchase.
After that he comes to the vice president‘s (Peter Thomas) office and waits for about 20 minutes, before the VP finishes his meeting. He says: “Peter, please approve this paper. We really need this camera next week”. But Peter cannot approve this purchase, because he knows that any spending of more than $3000 must be approved by the Chief Financial Officer – Michael Mendez.
And he sends John to the next office. John spends the whole day moving from one office to another, until he gets all the approvals required for Mary (and for the camera purchase, finally). And he will get his camera, but the whole workday is lost unless John has an assistant, Pauline, who does most of the work for him (and Pauline could have been a painter or a talented process manager instead, but unfortunately somebody has to be John’s assistant because there are so many papers and approvals).
And what if John asks his secretary to approve this paper? This paper could get lost in a folder, called “Archive documents, 1966”. Sounds depressing – doesn’t it?
Computer era
Let’s continue with 10-15 years old practices…
It was the start of the Internet era and email became the main means of business communication. So – what has changed in CapEx tracking? Instead of manually bringing his paper to Peter (or sending him a fax), John will send him an email with the same contents as on the paper. But again – why does John still send the request to Peter?
It must be sent to Michael and Peter didn’t know about this. Zero progress here then! Moreover someone receives 1-10 emails per day, but Peter (as VP) receives about 50-100 letters each day. And there is a chance that Peter’s letter will just be ignored (or moved to the ‘Spam’ folder and deleted later).
So, can we think that usage of emails improved CapEx tracking significantly? I can see the only improvement – sending an email is faster than bringing a paper physically. But, in general, everything is the same – the problem still exists…
Smart Era
Now let’s think about John, Peter, Michael and Mary in today’s environment. They work on a successful modern campaign, which is not afraid of technological innovations. And this company has bought Comindware Tracker. I am not saying that is the top of the evolution, but this is one of the most up-to-date solutions from the point of view of how it’s done, what technologies it has in it, and how it works.
Besides many other uses, our main characters use Comindware Tracker for CapEx tracking. So, John logs in to Comindware Tracker and creates a new object in the “CapEx Approvals” application. Everything is quite simple – he fills in the “Title” (video camera for commercials), “Department” (marketing department) and “Total amount” ($5000) fields and presses the “Save” button. After a final look at the request form, he delegates it to the next responsible person – in our case it is Peter. Peter is immediately notified about the new request via email (but of course, he also sees that he has a newly assigned task in the Comindware Tracker UI) and approves (or rejects) it.
You can add custom restrictions to workflow, thus not allowing Peter to approve requests that are more than $5000 in total. Or you can automatically choose the approver by analyzing the requested amount. Everything is possible with highly-customizable workflows in Comindware Tracker. OK – let’s continue with our process. So, Peter transfers the request to Michael, and he finally approves it after browsing his inbox in Comindware Tracker.
So – what are Comindware Tracker benefits in CapEx tracking? Here they are:
- You will never loose information – it is stored in a reliable database and every person, responsible for the current state of the approval process sees their tasks right after logging in to Comindware Tracker;
- The relevant people are immediately notified about all approval changes via email notifications;
- All information is highly structured – you can organize it in convenient way, using Comindware Tracker list filters, and the sorting and grouping options;
- You can organize your workflow in a way that suits your organizational needs. Comindware Workflow Editor makes it a very convenient and easy-to-learn UI.
As you can see, CapEx tracking has changed a lot. Even more, you can go ahead and also streamline operational expenditure (OpEx) using the similar workflow automation approach. Learn more about streamlining both capital and operational operational expenditure in this article – “What is CapEx and OpEx”.
You can try Comindware Tracker yourself at any time for free. And the final benefit I prepared for you is that Comindware Tracker includes several prebuilt solutions for different departments and businesses. And we have a solution for “Finance and Administration” with a well-designed “CapEx Approval” process. You can set up this solution and try this yourself. And do not hesitate to change this process to your company needs – it is very easy, as I already mentioned before. So – enjoy Comindware Tracker and our pre-designed CapEx Approval process.
