Hey UK, want e-invoicing adoption? Learn from the Danes!

danes Hey UK, want e invoicing adoption? Learn from the Danes!Thanks Max Tatton-Brown for pointing out this cool article by Tradeshift’s Christian Lanng on the website of The Guardian. There’s almost nothing as British as this daily newspaper, which was founded in 1821. So the British know their way about journalism. But e-invoicing is a completely different story. The UK government is struggling. Lanng suggests that the Brits can learn from the Danes about how to get public sector suppliers online. His answer? Make the e-procurement system free, open and online.

Everything for free

Back in 2004, Denmark found itself at a similar stage to the UK: it realised that an electronic approach to supplier relationships could both increase efficiency within the government and would benefit the whole economy. It quickly struck Lanng that if you want your suppliers to start behaving a certain way or adopting a certain technology, charging them to do so wasn’t going to work.

Go free, go open, go online

Lanng issued a prototype of an open source alternative and found opportunities for it to speak for itself. As soon as the decision was made to shift support behind the open alternative, EasyTrade, the tide turned almost immediately. Suppliers that wouldn’t have touched the paid EDI approach began to download the new, free software. As the UK public sector finds itself, like many of its counterparts around the world, looking for the secret to this transition, the answer from Tradeshift’s experience, is clear: free, open, online.

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  1. I agree with some elements of this article, but not others. Removing the perceived barriers to adoption of e-invoicing is key for a supplier to move away from paper. Cost is definitely one, the main others are:

    – Technical barrier – is the supplier willing to change their billing application and infrastructure to send XML or EDI invoices to you?
    – Process barrier – is the supplier willing to log onto a portal to submit their invoice? If they already raise their invoice in a finance application , why would they want to duplicate their effort?

    Unfortunately, asking suppliers to ‘download software’ is not the answer. I suppose this could be the reason why we are getting so much traction ourselves in Denmark. Suppliers want to connect to NemHandel, but don’t have the technical ability to send OIOUBL. They don’t want to change their systems or processes. They simply want to use tools they already have in place and use daily.

  2. I agree with Richard. At the UK National e-Invoicing Forum we are working with government (and Stephen McPartland) to promote the widespread use of e-Invoicing, and we do quote Denmark as a success.

    However, the success we quote has been in setting the mandate and the number of service providers creating solutions – the much vaunted ‘open interoperable standard’ really hasn’t had much to do with anything. As we all know, the great thing about standards is there are so many to choose from… ZUGFeRD anyone? SMEs don’t care about standards, they just want to send an (compliant) invoice. Corporates just want someone to manage the complexity for them.

    The UK isn’t too far behind, if you compare by size of economy, and there are UK public sector institutions that have embraced e-Invoicing – but not enough. We aim to change that through awareness, proposing a mandate, and by letting the market decide rather than imposing a (expensive) centralised system.