Digital transformation can expand your business quickly by improving management decisions and reduce dramatically time to market but comes also with new challenges like change management.
Because most of businesses are deeply rooted to their processes and sometimes resistant to any change, the introduction of e-Invoicing is often a matter of concern for business managers. As a result, innovation goes often through a transition period where we apply new technologies to the traditional and proven methodologies with the merit of not disturbing too much the accustomed users. A transition period called (in french) “effet diligence” in remenbering of old times when the first trains were in their design looking like to diligences, the famous four-wheeled, 6 horses powered, closed french stagecoach employed for long journeys.
Let’s take the example of the e Invoicing Directive 2014/55/EU. Quoting article 7 only machine-readable invoices which can be processed automatically and digitally by the recipient should be considered to be compliant with the European standard on electronic invoicing
; this statement leads to give priority to XML in the developments of the core invoice EN.
Meanwhile, the « diligence effect » burst into the discussions with claims for adaptive measures, legitimating a PDF based approach for e invoicing, even sometimes asking that structured data should be optional only ; adding to confusion, others alternatives like 2D encoding system making eruption in the e Invoicing landscape.
Avoiding any dogmatic position of the question, we can easily understand the concern of most of businesses regarding the issue of the a from scratch implementation of structured without transitionnal measures or hybrid systems.This issue may raise also three potential pitfalls :
- Act as a brake on innovation never reaching the full potential of the leverage on business processes ;
- Establishing hybrid systems as a permanent method of digitization, impeding any eradication of paper
- Multiply the processes and the modes of exchanges between parties.
On that point, I remember a pragmatic remark of a credit manager « But how to deal with multiple instances and formats, when one customer is asking for PDF, another one for EDI and the last one for XML… and pay attention to outcomes in the meantime.
Authentication of documents using 2D CODE is a good example of a bright idea very useful to fight against fraud on identity , professionnal attestations, birth record or diploma. Trying to push the borders of a very straightforward concept, new applications are envisaged to capture data from an invoice by direct scanning .Not quite new actually, the concept has been refined by GS1 for the DATAMATRIX expected to replace progressively the barcode in supporting item identification (GTIN).
Applied to Invoicing, the 2D CODE may show some limits in the capacity of data treatment and falling into the second pitfall, delay dramatically the shift to advanced processing based on structured data and not the revamping of a basic paper based invoicing process.
The deployment of eInvoicing comes along with great expectations for new models and technologies lowering the break even of transactions innovative businesses. This lead to a concept of disruptive innovation.
As defined by Clayton Christensen, a disruptive innovation is a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors
(1) .
The term is used in business and technology to describe innovations that improve a product or service in ways that the market does not expect, typically first by designing for a different set of consumers in a new market and later by lowering prices in the existing market. »
What does that mean ?
A disruptive innovation, is an innovation that helps create a new market or a value network and disrupts in an existing market by replacing an earlier technology.
This would be the precisely the case with e Invoicing, seen by the European Commission as pivotal to the whole e Procurement chain. Business processes may leverage dramatically eInvoicing as a disruptive innovation if we use the appropriate technologies and to a certain extend if we take the risk to forgot the « diligence effect ».
(*) effet diligence, is a french expression that depicts a situation where the introduction of innovation go through a transition period where we apply the old and traditional methodologies to new technologies.