14 Aug 2011 Do we need new standards for e-invoicing?
You know how useful standards are when you plug in an electrical appliance – the plug fits the socket. So it figures that we need an electronic invoice standard. We need the invoice plug to fit the AP socket. Right?
Count the number of B2B standards and regulations there are. That’s how many reasons there are not to send electronic invoices.
This question polarizes opinion. There are those who look at it from an operational or technical point of view. From their perspective, a single, or at least a small number of standards combined with regulations imposing their use is desirable even if that means developing a new one. It does make sense. If each standard represents a reason not to send electronic invoices, then a single objection is easier to overcome than many.
Then there’s the commercial view. Why would a supplier want to send electronic invoices? There’s little commercial benefit. If they do it for one customer the next customer will want it in a different format – one wants Ariba the other OB10. There’s no economies of scale. A “new” standard that just adds to the list of reason not to send e-invoices.
Then there’s the commercial reality that the vendors face. Why on earth would Ariba, OB10, Basware and the rest want to sit around a table and agree create a single standard? Impose change and compliance costs on themselves? Pay a license fee or a registration charge to a standards body? Regulation just adds to the cost.
And what about the practicalities. Plug sockets aren’t a great example of a standard. Buy an appliance in the UK and try using it in the USA. Standards don’t travel well. A standard developed in one industry or one country or in one region, is rarely useful outside of its comfort zone
The operational and technical view is, sadly, commercially naive. If we were to pay too much attention to the demand for a new more comprehensive message standard we’d continue to go round in circles failing to improve adoption rates. We live in a world with existing standards. We’re not starting with a blank piece of paper. There are embedded commercial interests already in place that will resist change.
We need rules and regulations – of course we do – but they should be pragmatic and flexible. The rules and regulations in the paper based world don’t impose a standard size of paper. As long as an invoice is legible, contains the minimum requirement for information and can be stored and audited then you can do what you like more or less. The last thing we need right now is for the barriers to entry made bigger.
The fewer rules and regulations we have, the faster we’ll see e-invoicing adopted. Let’s see electronic invoicing adoption become mainstream first, then we can think about making the rules tighter if we need to.