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Christian Lanng

Future of Business

Christian Lanng - Tradeshift

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E-invoicing: How a handful of vendors are ruining adoption

15 July 2014  |  4432 views  |  0

There’s a problem with e-invoicing. It’s a positive move for every business yet despite adoption gaining momentum, only a few companies have fully embraced it. This is crazy. It’s an enabler for the many supply chain finance and dynamic discounting initiatives. It gives visibility into spend. It supports sourcing and rationalisation opportunities. It allows suppliers to negotiate for faster payments. It also reduces the vast amount of paper circulating inside and out of companies, removing it from processes, driving down operating costs and increasing control.

So, how have we found ourselves in this position? Severe limitations with some existing platforms are preventing full-scale adoption and onboarding, and it means the true value of e-invoicing remains untapped by many businesses.

These limitations are present across every level of many existing solutions, from onboarding to outdated technology to implementation. Typical onboarding models rely on call centres, designed to coerce suppliers into signing up - people don't like this as it is brash and intrusive. But then, once reeled in and online, having paid the sign-up fees, users need to learn how to engage with the software through lengthy and complex training sessions. Once the solution is finally understood and the user has bedded in, they often want to make specific amends to suit their business. However to do this, they have to go through painfully slow innovation cycles.

Then we get onto the design. We live in a landscape where platforms easily synchronise with virtually every aspect of human life: design is championed through Pinterest; businesses can network via LinkedIn, aspiring musicians flock to SoundCloud and of course we have the all-encompassing Facebook. As a result, these intuitive, simple platforms are how businesses want their software and networks to look. Employees only engage with software unless it tallies with this expectation; this is totally at odds with the clunky approach of your average e-invoicing platform.

We also live in a world of mobile. The mass adoption of the smartphone and tablet, combined with modern, flexible working practices, means that any collaborative software absolutely must be optimised for mobile. Especially one that that deals with business critical functions such as managing contracts, managing relationships, e-invoicing and dynamic discounting.

And within this world of mobile there is a vibrant culture of apps. Android and iOS allow you to adapt your device to your tastes with apps and Windows 8 has followed suit. This concept has filtered through to many software developers in Silicon Valley who are taking a platform and app approach to business solutions. So if a company wants to tailor software to their processes, it’s possible to create an app after a very brief development cycle. Many e-invoicing platforms don’t offer this agility, don’t support third party apps and believe simply in tardy innovation cycles.

 It’s therefore no surprise that suppliers are hesitant to sign up to e-invoicing. Take Ariba for example. It has worked extremely hard to get 1.4million suppliers on its books but very few are referenceable customers – no one wants to stand up and shout about a product they don’t like.

Many of the e-invoicing platforms aren’t modern business networks. They were conceived of and built in the 90s; they act, feel and look like 90s products i.e. hopelessly out of date in the mobile/cloud era.

This is a major issue for businesses who have committed to outdated platforms. But it’s important to bear in mind that there are now intuitive platforms that can augment existing subscriptions, opening up a whole raft of e-invoicing options while tallying with our modern understanding of networks, design and mobile. These platforms also host e-commerce functionality, which works more broadly to deliver funding, combat late payments and provide procurement solutions.  

E-invoicing will save a business money but it’s easy to be duped by platforms that promise much but deliver little.  As a result, keep an eye out for the modern alternatives and you might find a platform that can genuinely change your organisation and create real value for your suppliers.  




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job title CEO
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Christian Lanng is CEO, Chairman and co-founder of Tradeshift, with the lead responsibility of shaping strategy and vision.

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