Digital transformation is now a mainstay in most companies’ budgets and its popularity is unlikely to decrease.
As paper transactions become a thing of the past, companies no longer have a reactive approach to change. They have a proactive one: they seek to encompass the latest financial technologies in order to get a competitive edge. In fact, for many CEOs it has become clear that adapting business processes to the digital landscape is no longer a choice, but a necessity.
So, which digitalization technologies should you be aware of and what would it take to implement them in your company? Before we answer that question, we should take a quick look at the current business landscape and on how digital document management has shaped it.
The European Digital Landscape
In terms of legislation, the European Union has been constantly working towards a common digital market, focusing its efforts on financial automation and online payment adoption. Some of its most notable directives are the Revised Payment Services Directive or PSD2, which concerns the creation of a unified electronic payment system and the now famous 2014/55/EU Directive.
The latter has just come into effect on the 17th of April. Romania, unfortunately, will have to face infringement penalties if it doesn’t implement its provisions. The 2014/55/EU Directive claims that all EU states should implement electronic invoicing within the public acquisition sector.
While this mainly affects the public sector, this also means that private business that work with public entities will also have to implement this system. It’s the European Union’s way of accelerating electronic invoice adoption.
Unfortunately, while many countries have the infrastructure and connectivity required for digitalization, they lack digital technology integration and access to digital services, as an European digital economy report shows.
However, if the public sector still has a difficult time adapting to change, it’s the private sector that seems to have the highest interest in digitalization and digital document management.
Most companies aiming for a global market are now investing heavily in digital transformation and process automation. But what is their main focus?
1.Electronic Invoicing: The Trend Becomes the Norm
According to the freshly released E-Invoicing Journey 2019-2025 report by Billentis, the global electronic invoicing market is expected to quadruple in size by 2035 and will most likely encompass around 550 billion invoices annually, compared to just 55 billion paperless invoices exchanged in 2019.
The same report claims the global electronic invoicing and enablement market will grow from 4.3 billion in 2019 to 18 billion in 2025! Aside from the legal provisions, a good reason for this trend is that invoices are ubiquitous. Invoices are impossible to avoid when doing any type of business in both private and public sectors. No wonder they are often called “the queen of all legal documents”.
This is why invoice automation is already on most companies’ roadmaps. Eliminating the paperwork, the extra human resources, and the time invested in manual invoicing can often yield unexpected long-term results (such as a significant decrease in error rates), as well as a sizeable ROI – as one of our whitepapers shows.
However, if the growing interest for e-invoicing is not enough to make you adopt it, there is something else that you should bear in mind. The future of taxation is also digital, with more and more governments insisting on encouraging e-government programs. Italy, for example, has introduced mandatory electronic invoices for both the public and the private sector as an effort to combat tax evasion.
The same Billentis study shows there is a great number of documents associated with taxation that, with the help of invoicing automation, could be processed without human intervention.
2.Intelligent Automation: A.I. Is not a Buzz Word, It’s an Investment!
According to the 2019 KPMG CEO Outlook, while A.I. is on the mind of multiple CFOs and CEOs, 65% of them recognizing its positive impact, only 16% have implemented A.I. and advanced automation programs. A Deloitte CFO Survey has showed similar statistics, with no less that 64% of CFOs admitting that the finance function in their organisation is a little or not at all prepared for A.I.
But why is A.I. so important to the world of eFinance? Well, mainly because it bridges the gap between conventional electronic invoicing and the ultimate goal of digitalization, the digital enterprise.
(Source: Billentins E-Invoicing Journey)
Adding robots to the digitalization process allows you to increase your speed and efficiency and also influence other parts of the acquisition process such as procurement and the supply chain. These fall under the auspices of P2P (Purchase-2-Pay) Automation, a process that can greatly improve your business workflow and boost your expansion.
Also, A.I-based technologies can be used to structure data, dig for insights (advanced analytics), and improve decision making.
Through its constantly adapting routines, machine learning can reduce human intervention, support fraud detection, forecast liquidities and aid with customer complaint resolution, dynamic pricing, and spending management.
According to Billentis, the machine learning as a service market will grow from 0.9 billion dollars in 2016 to 16.4 billion by the end of 2024.
3.Digital Transaction Management: Prepare for the digital enterprise!
Jim Lundy, CEO and Lead Analyst for Aragon Research claims that, by the year 2020 “65% of enterprises will have rearchitected their document processes with a focus on automated creation and routing.”
What does that mean? It means that Digital Transaction Management or DTM will become a standard, and that the digital enterprise will become a reality faster than we initially believed.
Digital Transaction Management removes the slow-downs of classical transactions that involve people and paper documents, and creates faster, easier, more convenient, and secure processes. It’s digital document management used at its full potential.
DTM means going beyond content and document management and focuses on including document transfer and certification, co-browsing and user permissions, secure archiving that goes beyond records storage, as well as a variety of meta-processes aimed at improving electronic document transactions.
In fact, many electronic invoicing and P2P automation providers already offer many of these features, features like secure and highly configurable archiving services.
While it’s adoption rate is difficult to estimate, the DTM model will gradually achieve global acceptance and incorporate other technologies such as blockchain, microservices, and advanced analytics. In other words: it will become the only way companies do business!
If you’ve just started or plan to start your digital transformation project, just remember to include a solid electronic invoicing system, give Purchase-to-Pay automation a try and make sure that A.I. and machine learning are also a part of your provider’s offer.
In fact, if you’re looking for a complete electronic invoicing and digital document management suite, why not give DocProcess a try?
Billentis – The e-Invoicing Journey 2019-2025 – https://www.exchange-summit.com/Billentis_Market_Report_E-Invoicing_E-Billing
Digital Economy and Society Index (DESI) 2018 – http://ec.europa.eu/information_society/newsroom/image/document/2018-20/ro-desi_2018-country-profile_eng_199394CB-B93B-4B85-C789C5D6A54B83FC_52230.pdf
- Deloitte CFO Survey 2018 – https://www2.deloitte.com/ro/ro/pages/audit/articles/cfo-survey-romania-2018.html