Supply Chain Finance

The soundtrack to my formative years was the Sex Pistols, The Jam, The Clash, Deaf School, Gregory Isaacs and Aswad. It was fun that the generation I was a part of had music that was revolutionarily different from previous generations yet there were still those older people who wished we would all just calm down and listen to Bing Crosby and Doris Day as though Elvis, the Beatles, The Doors and Pink Floyd had never happened in the preceding two decades. Punk rock had woken an older generation and reminded them of how much they enjoyed their heyday. And this is exactly the impression I got today when I read that the International Chamber of Commerce is to rationalize the language used to describe supply chain finance.

Francis-MaudeIt was announced yesterday that the UK Government will be fully supporting the introduction of electronic invoicing in public sector. Speaking at the launch of a Parliamentary Report: 'Electronic Invoicing - the next steps towards digital government', Francis Maude, the Minister for the Cabinet Office, expressed with enthusiasm his commitment to see the use of e-invoicing as part of the UK’s ‘Digital by Default’ agenda. The venue for the launch of the keenly anticipated report was the Strangers Dining Room in the Palace of Westminster, London. I was amongst a group of about 50 people, experts in electronic invoicing from both public and private sector, who listened with some excitement to the strongest endorsement yet by a UK Government Minister of a policy to see payables processes in public sector automated in order to liberate, an estimated £2 billion per year. And despite the wealth of expertise in the room, we all would have struggled to articulate the opportunities with greater clarity than Francis Maude.

I've become a fan of Nipendo. Nipendo offers, in many respects, what I see as the next evolutionary stage in Purchase to Pay. Rather than simply offering clever means to automate the traditional steps in the purchasing process through things like e-procurement and e-invoicing, they offer what I think of as 'Packaged P2P'. When I visited some of their customers recently I spent time with Eyal Rosenberg, their CEO and we spent quite a bit of that time discussing how the Nipendo platform could be leveraged to offer supply chain finance. And now they've done it and the press release that accompanies their new partnership with Integrate Financial explains the synergy.

As technology matures, industries are transformed. It is very rare that a single technology inspires or effects the change. It is more usual that a gradual evolution of a mix of technologies lowers the barriers and opens up the opportunity for business models that would previously not have been worth serious consideration. There was a time when the natural gas trapped in rocks under the ground, while known about, was simply not worth the effort to extract. But develop technologies like fracking that can tap this resource profitably and the future of a nation and its power needs is transformed. If you understand the signs, it’s possible to see these fundamental changes coming and there is one such change in the financial services industry that is visible quite clearly on the horizon. A mix of technology has matured and a new business model, barely feasible until very recently, has become compelling. It’s good news for business. It’s not so good news for the banks.

Crossflow Payments has been building their leadership team for a few months and they continue with another senior hire. Carl Maughan has joined the company as Chief Technical Officer. Carl brings strong business and technical architecture skills as well as solid technical leadership skills. He comes to Crossflow Payments after serving as Global Head of Architecture & Design at Euromoney. Prior to this he has been CIO of Stanleybet and has held different technical roles with Equifax and Erudine Financial Control Systems for over 15 years

A couple of weeks ago, I sat down with Tony Duggan, CEO of Crossflow Payments, an organisation looking at alternative ways to bring together suppliers and corporate buyers and strengthen supply chains. Supply Chain Finance is a bit of a buzzword at the moment. The old guard, the banks who seem to have tunnel vision for the very big trade finance deals, and the factors who exploit to a greater or lesser extent the vulnerabilities of small and medium sized businesses view the new SCF players with a mixture of  doubt, suspicion and (although they’d not admit it) – fear. And they’re right to. Some of the new models emerging are innovative and impressive and they promise to take business away from the traditionalists. Crossflow is going to do just that in my view. Inspired by hands on experience in industry, Crossflow Payments has taken the concept of ‘Just In Time’ manufacturing and applied it to the financial supply chain. Tony believes that this can help transform the way financial supply chains operate.