Why are finance people scared of e-invoicing?
The business case stacks up. The technology is proven. There’s a potential to save literally $millions. So why are finance people scared of e-invoicing?
Those who have been on the electronic invoicing journey will be familiar with the issue. There’s no objection to e-invoicing per se. The benefits are recognized and the finance and AP teams want to be good corporate citizens but they just can’t bring themselves to do it. “We need to ‘see’ the invoice” they say. “But the ‘invoice’ is the electronic file”, I reply. “Yes” they agree, ”we know that. But we need to be able to see it – even an image of it as it would appear on paper would suffice but we do need to be able to see it”.
They are not being stupid and they are sincere in their concerns. It’s one thing to extol the benefits of eliminating paper but paper invoices are important documents for audit purposes. An auditor may be happy on one level to examine reports from a finance system to understand what is going on but at some stage they may well, and often do, ask to see the underlying legal documents. The actual invoice. And even before the auditor arrives, finance people may want to see actual invoices to get information that would not be included in the electronic invoice itself. Ship from, ship to, bill to addresses for example or hand written addendums. The inability to perform such examinations presents a real objection that has to be overcome for an e-invoice program to be successful.
It takes me back to the 1980s when I first started to work. Email was being rolled out. Some of us were privileged enough to be given early access to the new tool. Young whippersnappers like me embraced it, found its limits really quickly and worked out a few pranks – as you do. But the older ones were less comfortable with it and I clearly recall how they would get their secretaries to print off all their emails so they could read them, write their replies – in pen on the print out – and put the response in the internal mail. It wasn’t because they didn’t get it. They’d never touched a keyboard in their lives and the ergonomics of using a screen to write was truly beyond most of them.
e-invoicing is similar. There’s nothing on a paper invoice that can’t be put on an electronic invoice. The examination of individual invoice records on a finance system is perfectly acceptable to an auditor and practices that require paper, such as manual annotations, need to stop. Retaining the comfort of the familiar paper invoice, physically or as an image, is no different to wanting your email printed.
We should have some sympathy with the finance people that struggle to cope and we need to support them in making the transition. Just because e-invoicing delivers a new process that is better, it doesn’t mean that people can immediately rewire their brains to accommodate it. But accommodate it they must, or they’ll be left behind.
Pete Loughlin can be found on twitter @peteloughlin