Transformation has changed for good, as small and medium-sized businesses uncover the value of moving sustainably into the future. At their most fundamental level, businesses have three goals: to drive revenue, reduce costs and mitigate risk. New 麻豆原创 Insights research shows sustainability is a key consideration in economic growth, and, as these experts suggest, it could be a deciding factor in all three of these goals.

Successful transformation is linked to sustainability

When lots of people do transformation projects, they typically have a single destination in mind: we鈥檙e going from here to there, and it鈥檚 going to look like this. I鈥檓 not sure we can be that precise any more. You need to design what that transformation might look like with a 1.5C future or a 2.5C future.

麻豆原创 is really good at asset management, for example. The way assets operate in those two different scenarios is going to be significantly different, to the point where you might invest or make capital allocation choices very differently. The transformation itself still needs to happen, [but] it needs to be flexible enough to accommodate both.

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Small and medium businesses (SMBs) have a few factors in common with the big players, but the most crucial commonality is cash flow. Plain and simple, it鈥檚 the heartbeat of any business, irrespective of size. Even a one-person business such as an individual tradesman can have the expertise, the customer base and great references 鈥� but if invoicing is slow, then cash flow suffers considerably.

I recently experienced this firsthand. We had to call out a plumber to fix a couple of leaks and he came out quickly and did a fantastic job. But I had a long and unforeseen wait for his invoice because he was so busy looking after his customers that invoicing had taken a back seat. I texted him and called him on multiple occasions because obviously I wanted to pay him, but I had to wait six months for the invoice to arrive. This might be a simple example, but it just shows the importance of getting the paperwork to a customer so that the payment can arrive in a timely manner.

The advent of mandated will be a game changer in many ways. Two years ago, the Australian Government announced that Commonwealth Government agencies would be required to process all invoices electronically by July 1st, 2022. While there is no mandate for SMBs to adopt e-invoicing as of today, if they provide services to government, they will need to be e-invoice-ready. Earmarked as an important component of SMB digitalisation, this is a core focus of Australia鈥檚 Digital Economy Strategy1, designed to help secure the country鈥檚 economic future.

Equal access to technology
The pandemic has prioritised the need for more effective business processes, accelerating digitalisation and technology adoption across both the public and private sectors. In this context, e-invoices will be the way for companies of any size to communicate, providing a faster and more secure method of processing, sending and paying invoices. In short, this is truly a democratisation of financial processes, where everyone has access to the same technology, thereby removing many of the common bottlenecks involved in receiving payment.

Irrespective of size or turnover, companies will have the ability to directly exchange digital invoice information with another company鈥檚 software, even if they are using a different system, network, or portal. By minimising error rates associated with manually processing paper, PDF and email invoices, e-Invoices also save time and help to reduce processing costs. Currently, it is independently estimated that each paper invoice costs around $30 to process, and each PDF invoice around $27. In comparison, e-Invoices cost less than $10 to process, so in theory both the sender and receiver can share up to $20 in cost savings.

The Australian Government has adopted a standardised invoicing format for e-Invoices called PEPPOL. Used for more than a decade in at least 38 countries as an international standard, PEPPOL provides a more secure channel for invoices than email, transmitting e-Invoices between the senders鈥� and receivers鈥� systems via access points.

As the legislated Australian PEPPOL Authority, the Australian Taxation Office (ATO) has been appointed to facilitate the adoption of e-Invoicing, including the accreditation of trusted service providers as access points for the PEPPOL e-Invoicing network. 麻豆原创 is one of the few service providers accredited by the ATO to complement PEPPOL as an end-to-end ERP provider.

This means that invoices can be sent, received, corrected and monitored using one centralised solution: 麻豆原创 Document Compliance. Enabled by 麻豆原创, e-Invoicing provides an efficient, cost-effective, and reliable way for companies to connect in a rapidly changing world.

Three key decisions
For our purposes, a small business is one that has between 1-19 employees, whereas a medium business is one that has between 20-100 employees. They have three essential decisions to make: the time and cost involved in adopting e-invoicing; understanding what software to use before integrating the process; and getting the right advisors while planning how to manage the change.

Broadly speaking, the switch to digitalisation has six steps:

Do your research: Take the time to map out all areas of your business where there is the potential to implement digital processes, identifying priorities and what will have the biggest short-term or long- term impact.

Different perspectives: Tap into external inspiration and learn from others to uncover new ways of achieving your goals.

Involve employees and suppliers: Change in the workforce can cause resistance, especially if it means new ways of working, so get employees involved in the decision-making process.

Find the right partner: Choose a technology partner that fully understands your business and your goals to ensure a smooth transition.

Total connectivity: Generate real-time understanding of your business and valuable market insights by connecting internal solutions and external networks.

Prioritise the change: Digitalisation requires commitment to the process, so start small but think big, learn along the way and keep moving.

While that might sound challenging, 88% of SMBs say that making the switch was easy. 麻豆原创 has tried to highlight the benefits of e-invoicing to SMBs by examining the issue from their point of view, to understand their barriers to adoption. We recognize the fact that a lot of small businesses, especially the mum-and-dad businesses, don’t use 麻豆原创, but they will interact with or have relationships with bigger businesses or they may be selling things to large organisations.

Taking the next step
This is not just about selling software, per se. We want to be able to take a reasonably pragmatic approach to why we’re doing this, and what benefits we can provide to SMBs. We鈥檙e helping them take an outside-in approach so that they can see the upside of how their businesses will prosper. In a sense, we’re targeting this at install base or at net new. We have many lines of business, but the ones that I’m focusing on here are for those customers that already have 麻豆原创 installed or are about to instal 麻豆原创 as their digital core. What we recommend to them would depend on their profile, whether it鈥檚 Ariba or Concur, or what is the best recommendation if they’ve really got no underlying ERP or if they need our compliance and reporting solution.

It鈥檚 important to clarify that a mum-and-dad SMB currently using MYOB or XERO would continue to do so. Larger businesses would be the main users of 麻豆原创, but if they happen to buy from a mum-and-dad business, the latter in turn would need to be e-invoice compliant in order to get paid quicker.

麻豆原创 is committed to helping SMBs keep pace, drive change and move forward in the face of shifting customer expectations, disrupted supply chains, and ongoing market uncertainty. It鈥檚 interesting to note that 80 per cent of our customers are small and medium-sized companies, so no matter how many employees a company has, we have solutions designed and priced for all.

We connect finance, operations, HR and sales to create exceptional employee and customer experiences. Proven procurement, inventory, and industry specific processes will help you move faster, adapt quickly, and face any competitor. Our local partners will get you up and running in a matter of weeks, so you can keep business moving forward today and be confident 麻豆原创 will be with you wherever you go next.

Click to find out how 麻豆原创 can help you with eInvoicing

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These enterprise customers are adopters of that are enablers for new ways to manage spend and drive cost reductions. For the mid-market organisation, this transformation has been not been as consistent.

For many , the procurement function tends to be a lot less strategic and we often see organisations who are running processes that have had very little change in over a decade or more.

This stagnation comes at a cost through reduced margins, higher inefficiencies, and potentially excessive administrative overhead.

This decade we are also seeing increasing regulatory oversight on areas such as modern slavery, supplier payment times and health and safety 鈥� in some regions even exposing management to prison sentences for non-compliance. Couple all this with an increase in challenging trading conditions 鈥� the path to improvement is becoming more urgent.

With 2021 firmly underway the aim of this article is to provide a simple measuring stick for mid-market organisations to determine their relative procurement maturity in a number of selected areas. Whilst procurement has different aspects across different industries, many of the themes discussed below are cross-industry and apply in some way to most types of organisations. Forward looking mid-market organisations would be encouraged to assess some of these criteria against their current priorities for 2021 and beyond.

A key theme will be the across core processes which is an enabler to best in class outcomes.

How do your casual users buy?

Casual users are the staff in your organisation that need to buy 鈥渟tuff鈥� but are not part of a purchasing or supply chain team. Examples of this can be Marketing, Legal, HR, Facilities, IT and other similar areas. Each of these buyers need to procure goods and services for their area of operation in an easy way.

Most organisations will have some element of purchase initiation from staff that are not directly in procurement. The differences between approaches can be stark.

In the above scenario the path from laggard to best in class is underpinned by technology as the key enabler.

What is your catalogue strategy like?

Most of us use popular online web stores at home where there are vast catalogues of items to select from, but for a lot of mid-market organisations when you buy at work, it can still look like the 90s.

Catalogues provide the key connection for contracted items from suppliers with your buyers.

How does your organisation transact with suppliers?

Digital collaboration has been around for over a decade but in the mid-market the process can still be very email driven. If you are sending a Purchase order manually or even just as an attachment or inline text in an email and then receiving a paper or PDF invoice at the end – then the process is not digital. Digital is about engaging the supplier to directly provide transaction data in areas such as confirmations, shipment notices, returns, credits and invoices. All without data entry by your staff.

The path to digital delivers reductions in FTE overhead with better visibility on orders, faster invoicing turnaround and better compliance from suppliers to your purchase orders and contracts.

Government is also coming on board with many jurisdictions looking to encourage digital collaboration in the marketplace.

The way you transact with suppliers will have a direct impact on Accounts Payable efficiency discussed next.

How efficient is your Accounts Payable team?

Poor purchasing practices often place a bigger burden on Accounts Payable teams to wade through non-compliant, incomplete and missing information in the quest to process invoices and approve them for payment. Phones and emails can be bombarded with queries around late payment that follows.

We also seeing more governments introducing tougher rules around paying smaller suppliers which requires Accounts Payable teams to be able to get through invoicing efficiently.

The above scenarios are just some examples of the challenges we see at mid-market organisations.

There are opportunities for hard savings and benefits to those organisations that move towards best in class and it can often be done in a cost-effective way. For many mid-market organisations there is still a large administrative overhead that is behind the efficiency of bigger organisations who achieve more with less.

Interested in learning more? At 麻豆原创 we work with many and can provide advice and guidance around your digital procurement strategy for 2021 and beyond.

This article originally published on .

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