Governments in many countries are considering how best to capitalize on the opportunities that electronic invoices present. Some countries like Brazil and Mexico have used the force of law to insist on the use of electronic invoices - other countries have mandated that suppliers to public sector use e-invoices. But some of the biggest economies in the world, notably Germany, the UK and the United States seem hesitant. Perhaps they don't want to interfere too closely in commerce. Maybe it's the fear of the bureaucracy of new legislation that puts them off. It could be lack of political will. But by providing no encouragement or leadership, these governments are depriving their economies of literally $billions in efficiency and liquidity and as a stakeholder in this, I'd like to propose a three point plan to persuade businesses to use electronic invoices.

It's clearly the right thing to do. So why isn't everybody doing it? I'm going to have to come clean. I was, for years, one of those people that was reluctant to recycle. I wasn't a global warming skeptic or anything like that. My formative years were in the 1970's when we thought the oil was about to run out. Green was good and what is now called sustainable energy sources were seen as the way of the future. I have a scientific education so when I hear that a large majority of scientists agree that there is an urgent need to control carbon emissions I don't think twice about ignoring the conspiracy theorists and crackpots that claim we can carry on regardless. So why was I reluctant to recycle? Why was I not in the least bit motivated to turn off my standby lights? And why do I love plastic bags? And what's any of it got to do with electronic invoicing?

Question: When is an standard not a standard? Answer: When there’s loads of them. In Europe, there’s more e-invoicing standards than there are languages spoken so, when the EU Commission in it’s draft directive on e-invoicing in public sector calls for more consideration into developing a common standard, is it suggesting we need more? I spoke to Mikkel Hippe Brun, Chief Strategy Officer at Tradeshift, to get his thoughts.

There’s a perennial discussion about supplier fees for electronic invoicing. Should there be no fees to suppliers because all of the business benefit is on the buyer’s side of the equation? Should there be at least a small fee to suppliers that reflects the benefits of eliminating postage costs? Or should the fees be akin to purchasing card fees and be proportionate to the value of the invoice? While some see it as an ethical debate, it isn’t. It’s a commercial discussion. Everyone’s in it to make money and the debate is no more than an industry squabble. The fact is, most suppliers see supplier fees as a cost of doing business – you don’t get anything for nothing – and as far as suggesting that suppliers will pass the costs back to the buyer, even a junior procurement professional knows how to mitigate that risk and insist on no increase in pricing. What’s really important is the benefits that are delivered in terms of efficiency. This is one way of looking at it but there is another way and that involves doing the math.

Outsourcing is not a bad thing. It allows companies to focus on their core competencies and let others do the rest. But there are some unintended consequences. When companies outsource processes to low-cost labor, they lose the motivation to modernize the process. Handcraft can be of value. You can argue that a handmade leather purse or a piece of pottery is nicer than a machine-made one. But a hand-processed invoice?! I don’t think you’d find much beauty there. When we outsource invoice processing, we settle for a short-term -fix rather than challenge ourselves to innovate. That’s when BPO becomes detrimental to long-term success. We are settling for cost reduction rather than process improvement.