When eInvoicing arrived on the scene, it loudly heralded a new era in automation, process efficiency with the associated benefits of cost reduction and better transparency. Yet over a decade on from its launch, many organisations that have chosen to adopt this technology are not getting promised benefits. Instead they are bogged down in projects that have taken too long, consumed too many resources and delivered too few results.
In a world where technology is becoming all-pervasive, eInvoicing networks should be the de-facto communication platforms between buyers and suppliers to enable better trading relationships. However, in too many businesses this simply isn’t the case.
At Taulia, we’re passionate about enabling buyers and suppliers to work better together and we believe that eInvoicing technologies could and should work if you approach them with the right strategy.
We’ve taken a look at the most common faults of unsuccessful eInvoicing projects, and put together 5 ways to ensure a successful eInvoicing initiative:
1. Adopt the right strategy.
If you are treating this as a one-sided cost saving operation, it’s going to fail right from the "get-go," as Americans say. For eInvoicing projects to be successful, there has to be something in it for both parties. Both buyers and suppliers must have quantifiable benefits out of it. Put yourself in the suppliers shoes and ask yourself if you would sign up--the answer may surprise you.
2. Never, ever charge supplier fees.
Many eInvoicing projects charge the suppliers fees using the rationale that suppliers are already incurring costs manually processing the invoices. Suppliers are charged less than the cost of a postage stamp per invoice, and while this is true, it misses the real point.
In our experience, suppliers combat this strategy by simply adding the fees onto their pricing, or much more commonly, simply refusing to use the eInvoicing network to submit their invoices. This can herald the end of your shiny new eInvoicing strategy when you’ve barely started.
3. Don’t make it hard.
Further problems arise if the eInvoicing process is too difficult for suppliers to use. Many suppliers are likely to lack sophisticated systems and processes, so there needs to be a simple-to-follow on-boarding process that will get all suppliers up and running quickly. And once signed up, the supplier portal needs to be easy-to-use, otherwise all that hard work simply goes to waste as suppliers default to their old processes for invoicing.
4. Don’t exclude some of your suppliers.
It’s not just hidden costs and tricky technology that prevents eInvoicing platforms from delivering to their full potential. Many fail by not enabling all suppliers--even the smallest--to access the system. When a company adopts a solution to automate its payment processes, 100% of suppliers must be brought onto the system. If not, you are left with a two-tier system that is complicated and costly to administer.
5. Don’t see eInvoicing as the final solution
Many companies view eInvoicing as the end solution for the business, when it is, in fact, a first step towards further payment automation services. At their heart, eInvoicing projects enable new trading relationships between buyers and suppliers. These include initiatives like dynamic discounting, which enables buyers to offer their suppliers the choice of early payment in return for a discount. Such an approach builds flexibility into the supply chain and gives smaller suppliers greater choice over their trade credit.
The huge benefit of this last point is that it becomes the true driver of an eInvoicing project. The whole purpose of suppliers submitting invoices is that they want to get paid (obvious, but needs stating). If you can provide a way for suppliers to get paid easily - not just on time but early, then you have something that is of real value for them, something that they will eagerly adopt.
How to ensure your eInvoicing solutions provider is a hero not a zero
To help you get under the skin of any eInvoicing project, here are some questions that you should be asking:
How long will it take to go-live from contract sign?
How long is the on-boarding process for suppliers?
What percentage of suppliers will you migrate to this system?
What supplier adoption rates do you typically achieve for your customers?
Do you charge a fee for individual invoices or is the solution free to use for my suppliers?
Do you offer dynamic or enhanced discounting options to help suppliers choose to get paid early?
How dedicated is your customer support once the on-boarding process has finished?
If in doubt, get some help
If you want some help and guidance, why not post a question on this blog below and we will do our best to answer it. Alternatively, you could ask for help from our new eInvoicing Rescue Service which provides free consultation and advice for businesses whose eInvoicing and ePayment solutions are not delivering the expected value to the business. Don’t be shy!