e-invoicing standards are the reason why we’re getting nowhere

e-invoicing standards are the reason why we’re getting nowhere

E-invoicing isn’t the first victim of standards and it won’t be the last.

B2B standards, designed to guide businesses down the right path, to allow disparate organizations to inter-operate, don’t work. They have the opposite effect. They are self defeating. They attempt to create a single agreed way of working but instead, they embed incompatibility and constrain growth and until we get rid of the standards we’ll continue to flounder. Purchasing Insight logo

Regular readers will know I don’t mean it – well not entirely. I do mean it a bit. Just consider for a moment where standards get us.

What have standards ever done for us?

We’ve all heard that a mobile phone has more computer power than Apollo 13 but did you know that you have more global navigation capability in your car than an Airbus A380? Really! Even today, airliners need verbal direction from the ground in order to get from A to B. They have to zigzag from one ground beacon to the next, changing altitude in steps according to spoken instructions. As a result, the average flight in Europe is 31 miles longer than it needs to be. It’s a waste of time. Its a waste of fuel and it’s all because of standards.

Air traffic management systems are stuck in the 1950’s and recent attempts by the airlines to invest in modernization have been thwarted because the air traffic controllers have failed to make the similar investments necessary for compatibility. It’s ludicrous and it’s going to cost a small fortune to put it right. According to the Economist, Barack Obama has called for a further $1 billion of investment to get the US ATM into the 21st century in Brussels, officials are talking about 3 times that figure to do the same in Europe. But the costs are a small challenge compared to the problem in persuading so many parties to agree on a single way of doing things. It’s likely to require legislation which will take time. Developing countries may feel bullied into costly solutions and avoid change. It’s a mess.

E-invoicing might just end up in the same mess. There are strict rules about the information that is required in an invoice and each country has its own version of what is necessary. It’s not trivial to get nations to agree and the standards – the-set-like-concrete standards – aren’t helping. We’re at a critical point. The technology and global infrastructure is in place. Business and governments get it. If ever the was a time for pragmatic cost saving it’s now. And we’ve got to make some decisions.

Ask yourself, if you were the airline industry in the 1950’s and you knew then what we know now – what would you do?

Of course we need standards but what sort of standards? – Restrictive standards that are difficult to dismantle? Standards designed primarily to serve the business interests of today’s strongest players? Or standards that offer a flexible framework to support diversity and to withstand the changes of an ever evolving business world?

Einstein said it like this: “The world we’ve made, as a result of the level of thinking we have done thus far, creates problems we cannot solve at the same level of thinking.”

We need a new level of thinking on standards.

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