What are the main challenges of successfully implementing e-invoicing in Germany and what are the possible actions to overcome them?
I must admit that the implementing challenges faced in Germany are similar as those faced in any other European country. Considering the exchange of invoices, the technical side is not very complicated, but we should not underestimate project organisation. If we take, as an example, a large manufacturing company cooperating with thousands of partners, the challenge will be called on-boarding process. This means contacting all of the partners and convincing them to use the solution, connecting them to an e-invoicing platform and conducting tests. It requires additional resources and experience on how to run such projects. One may think that I am not objective, but I would advise to outsource this process to an e-invoicing provider that already has references in this area. We observe the trend in Germany to move from in-house solutions into SaaS platforms.
The usage of formats and channels differ a great deal depending on the country and size of the companies. How would you describe the impact of ZUGFeRd standard on German SMEs and large businesses, respectively?
Yes, there are a lot of different formats and standards and that is why from time to time there are initiatives to create one common standard. This is the exact reason why the ZUGFeRD standard (Zentraler User Guide des Forums elektronische Rechnung Deutschland) was established. The idea is to have a common e-invoice specification in Germany and it is very important to combine the visual part (PDF) which is readable for people, and the structure data (XML) which is readable for machines. So far, other formats are still more popular and in use, but all the significant IT providers have already implemented ZUGFeRD in their solutions not to miss the possibility to extend their offer. ZUGFeRD may be the way to enter e-invoicing for small companies, which are the target group for this standard.
What advice would you give to companies looking to achieve a more revolutionary model, towards holistic Order-to-Cash and Purchase-to-Pay?
Having the process automated and digitised is highly recommended to take advantage of building value added services. Processes are then more transparent and we are able to improve cash flow and working capital management. Thanks to reporting and data analytics it is possible to prioritise the payments in order to maximise discount saving potential or to promote our best partners and build stronger relationships. Using mobile applications we can speed up the acceptance process.
What are the shortcomings of current automation and optimisation of invoice processes and consequently, how to address them?
In order to have really efficient automation, it is not enough to just implement e-invoicing. The process is more complicated and sometimes requires integration with plenty of IT systems, e.g. the so-called ‘three-way match’, which means matching the invoice data with the purchase order and delivery. This type of concept enables the smooth processing of invoices and makes the process easier, but it also requires integration, at least with ERP. The quality of master data is one of the most important success factors in accounts payable projects. Only well-managed data enables us to match the invoices with appropriate partners and related documents. I would like to add that it is not possible to fully automate the process and there will always be some exceptions where manual intervention is required, but it is already possible to reach a very high level of automation. Investment in the project should be adjusted to the size of the company and the amount of processed invoices.
Beyond the environmental benefits, what else does paperless invoicing bring as benefits for finance departments?
If we consider the processing of structured data, it is a great advantage, especially for saving time. Companies which have implemented invoice process workflow (accounts payable) are getting all of the invoice data directly into their workflow mask. There is no need to convert unstructured data, which always means additional costs and possible failures. It is possible to find out, very quickly, at which step the process is currently at to find the documents immediately, and to use the collaboration and reporting functionalities.
About the author
Dariusz Biernacki studied in Kraków, Poland, where he also started his professional career. With more than 11 years of experience in the EDI area, including working as a Project Manager responsible for EDI in Central and Eastern Europe, Dariusz is now, and has been for over 5 years, managing the Comarch EDI& ECM Business Unit in Dresden, Germany, where the Competence Center of Comarch for these solutions are located.
About the company
Comarch EDI is a B2B platform, which provides a competitive advantage by a fast and secure data exchange with business partners. The solution provides the automation of data processing throughout the supply chain: from the procurement process, through the logistics, to invoicing and payment processing.
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