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  • 1.                                          Real  Time                                                Economy   Swiss  Payment  Forum     27-­‐28.11.2013    Bo  Harald    
  • 2. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracHon   e-­‐  and  mobile  banking  criHcally  important   Conclusion  
  • 3. Challenges in a borderless world 1.  The effects of digitalization in an open global economy on us, our customers and national economies have become very clear: there is nowhere to hide. 2. Only proactive actions to improve the value proposition and reduce the cost-base will secure the future. Real Time Economy services deliver both In the same click!
  • 4. Technology  moving  from  process  enabler  to   smart  Networked  Economy  driver   Networked Economy Process Automation Personal Computing 1980 1990 2000 2010 2020 4
  • 5. 2.  Trends  and  Megatrends  (1/2)   1.  Capability  of  IT  is  doubling  at  constant  price  on   yearly  basis  (ignore  at  your  peril..)   2.  Customers  expect  net-­‐based    services  –  Google  and   Facebook—like   3.  Opportunity  to  build  and  interconnect  vast  data     volumes  >  moving  from  self-­‐service  to    service  
  • 6. 2.  Trends  and  Megatrends  (2/2)   4.  Cloud  service  opportunity  >  new  levels  of   interconnecHvity  and  in-­‐cloud  innovaHon   5.  Enabling  automaJon  of  everything  >  cut  SME   administraHve  cost  in  half  and  corresponding   savings  in  the  public  sector  (total  potenHal  4,5bn€/ pa  in  ICT2015  path2)   6.    Real  Time  compleHon  across  networks  is   increasingly  expected  and  needed  –  new  value   dimension  
  • 7. Your  customers  have  clear  goals..   Speed up digitalization! 1.  Sell  more   2.  Create  customer  delight   Speed up digitalization! 3.  Lower  costs   Speed up digitalization! Digital  innovaHons  –  incremental  all  the  Hme  and  from  Hme  to  Hme  -­‐    in  products,  services,  sales  and  administraHve   processes.     How  can  you  help  customers  to  proceed  –  beZer  and   faster?  Create  value  in  new  dimensions..    
  • 8. General  dilemma     1.  The  highest  performing  companies  have  well   developed  systems  for  killing  ideas  that  their   customers  don't  want.     2.  As  a  result,  these  companies  find  it  very  difficult  to   invest  adequate  resources  in  DISRUPTIVE   technologies  -­‐  lower  margin  soluHons  -­‐  that  their   customers  don't  want  –   3.  unJl  their  customers  want  them.     4.  And  by  then  it  is  too  late!     Clayton  M.  Christensen  in  The  Innovator’s  Dilemma  
  • 9. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracHon   e-­‐  and  mobile  banking  criHcally  important   Conclusion  
  • 10. RTE  –  NaJonal  Co-­‐InnovaJon  program   Full   SEPA   FVC   FIA1   FIA2   SME50   2006   2008   2009   2010   2012   Full  SEPA     (Full  Single   European   Payment  area)   -­‐ SEPA  payments     -­‐ E-­‐invoicing   FVC     (Full  Value  Chain)   -­‐  Harmonizing   value  chain   development   FIA  1     FIA  2     -­‐   E-­‐accounHng   reference   (HliöinHviite)   -­‐   Standard  for   Electronic  Financial   ReporHng   ( www.raportoinHkood  )   -­‐ Global  e-­‐invoicing   standard  ISO20022   -­‐ European  e-­‐ invoicing  work   -­‐   Electronic   Financial  Statement   and  XBRL   -­‐ Fully  Integrated   Payroll  (FIP):  Payroll   reporHng  codes  and   pracHces   -­‐   Real-­‐Time  VAT   -­‐ European  e-­‐ invoicing  work   (  Fully  Integrated   AccounHng  1)   1.1.2009-­‐30.6.2010   (Fully  Integrated   AccounHng  2)   1.8.2010-­‐30.12.201 1   SME  50   (’AdministraHve  costs   in  half…’)     2012-­‐2013   1.  AFA  –  Automated   Financial   AdministraHon   2.  FAR  –  Fully   Automated   ReporHng   3.  ERM  –  Enterprise   Risk  MiHgaHon   4.  SIM  –  Sustainability   Intelligence   Management    
  • 11. SME50  –  Overriding  MoJvaJon   Cu;ng  costs  in  half  +  …   SME  50  is  building  on  the  EC  DG  Enterprise  public  sector  “red   tape”  iniJaJve  (reduce  cost  of  administraHve  burden  by  25%  by   2012).     SME  50  focuses  on  soluHons  for  automaJon  of  administraJve   processes  to  1.  cut  costs  (addiHonal  25%),    2.    lower  risks  and  3.   improve  financing  and  cash  management  within  the  enterprises.     SME  50  automates  processes  to,  1.  save  costs,  2.  lower  risks,  3.   improve  cash  management  and  4.  collect  taxes  due  for  the   public  sector   4.3.2014   Photo:
  • 12. Real-­‐Time  Economy  for:   1. Better Productivity 2. Better Service 3. Better Environment 4. Better Co-innovation 5. Better Jobs Photo: Sachyn
  • 13. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracHon   e-­‐  and  mobile  banking  criHcally  important   Conclusion  
  • 14. How  to  get  there  –  e-­‐invoicing   Two  key  recommendaJons   implemented:   -­‐        New  VAT  direcHve  –  equal  treatment   -­‐  ISO20022  global  message  standard   (UNCEFACT  CII  v2  based)   Next:     Harmonized  and  automated  VAT-­‐ reporHng  
  • 15. EC  Expert  Group  on  e-­‐Invoicing   Crystal  clear  mindset:   Paper  invoices     have  NO  future     in  EU   15 2010-­‐11-­‐21  
  • 16. e-­‐Invoicing  Business  case   -­‐  Enterprises  in  Finland  can  save  2,8bn€/year  in  b2b   (Employer’s  AssociaHon)   -­‐  The  municipals  can  save  150m€/year  (Municipals  AssociaHon)   -­‐  The  state  sector  can  save  150m€/year  (State  Treasury)   -­‐  Investment  needs  are  minimal/small   How  get  there  fast?   1.  Simple  tool  for  even  the  smallest  enterprises   2.  StandardizaHon  to  speed  up  ERP-­‐adjustments   3.  Charge  for  paper   4.  Deadlines  –  public  sector  FIRST  out  
  • 17. Example  from  globally  leading   manufacturer  of  fine  paper   United  Paper  Mills  le/er  to  suppliers:   “Esteemed  trading  partner,   UPM  moves  to  electronic  invoice  pracHces   from  1.7.2009  onwards.  In  pracHse  this   means  that  the  company  only  accepts   electronic  invoices.     ….   From  the  beginning  of  2010  UPM  will  have  to   return  paper  invoices  to  the  senders….”   Model  case:  NO  scanning  
  • 18. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracJon   e-­‐  and  mobile  banking  criHcally  important   Conclusion  
  • 19. Bigger  reporJng  picture   Seller Invoice file E-Invoice file (any format) Operator Extracting data Account statement 3.0 > Real Time accounting Real Time Cash flow forecasts Real Time Invoice financing Buyer1 Mail Domestic VAT EU - VAT Tax inspection Intrastat Forecasting E-mail (PDF) Buyer2 Buyer3
  • 20. Real-­‐Time  VAT   ISO20022 ISO20022 ISO20022 ISO20022 ISO20022 ISO20022
  • 21. StandardizaJon  breakthrough  in  extended  payments   Coming: ISO20022 for factoring ISO 20022 Tax Invoice ISO 20022 e-order 20022 e-invoice 20022/11649 creditor reference Invoice Seller Invoice Biller Service Provider Invoice Buyer Service Provider Buyer 20022 payment 20022 XML account statement Biller’s Bank Payment Infrastructure 21   Buyer’s Bank 20022 XML account statement 2010-04-07
  • 22. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracHon   e-­‐  and  mobile  banking  criJcally  important   Conclusion  
  • 23. simple insight ….simple insight - that the only thing scarce in a world of abundance is human attention.” Less  Jme  for  any  one  thing...  >  quest  for     clarity,  clinical  simplicity,  holisJc  collaboraJve   offerings  and  repeatability    
  • 24. Bank customer Bank corporate customer Utility customerCorporate utility customer My name is Guy Same Guy Citizen in public sector service Enterprise in public sector service Operator customer Operator corporate customer
  • 25. Banks & insurance Pankin asiakas Pankin yritys-asiakas Utilities Sähköasiakas Sähkö yritysasiakas Same familiar e-tools - embedded Often used and trusted e-tools for e-id, e-signatures, e-payments, payments-integrated e-invoicing Mr. Same Guy Same familiar e-tools.. Terveyskeskusasiakas Public sector Same familiar e-tools - embedded Same tools across: - Roles and - Services Operaattoriasiakas Oprin yritysasiakas Telecom
  • 26. Innovation ladder example from banking High volume service improvements 8. Mobile payment approvals 7. Extract VAT data from einvoice > automated reporting 6. Integrate e-invoice with account statement > automated accounting 5. Receive e-invoice for 1click or automated payment 4. Send e-invoice – just like a payment 2.e-banking credentials connecting 3rd parties 3. Bill payment habit > ecommerce payment Big productivity improvements 1. e-banking usage 26   2006-03-23 2010-11-21
  • 27. Not user friendly.. Economy of repetition
  • 28. The  best  innovaHon  is  open     Reuse  of  a  familiar  tool       For  new  purposes  
  • 29. It  is  all  about  human  behaviour….   o  "What  I  hear,  I  forget.     !   What  I  see,  I  remember.     "   And  what  I  do,  I  understand.“   Time  to  connect..  
  • 30. EU  focus  on  e-­‐invoice     Only  banks     can  make  the  mass  market  breakthrough  using:   1.    ready  standards  (ISO20022)   2.  omnipresent  net-­‐banks  as  interface,     3.  the  payment  system  for  transport  and     4.  their  massive  sales  power  for  MAKING  IT  HAPPEN.  
  • 31. EU-commission slide: II.1  What  are  the  driving  forces  for  the  EU  to  act   1.  The total costs of (cash & electronic) payments to the economy ranges between 3 - 4% of GDP. 2. A shift to electronic payments* (example: Nordic countries) can half average cost of producing payments over a period of ten years and has a positive impact on consumption and GDP growth (10% increase in e- payments # 0,5 increase GDP). Payments-integrated e-invoicing will have a similar impact !!
  • 32. Nordics leading the revolution #1 Sweden #3 Finland
  • 33. Of  course..   "We  tend  to  overesJmate  the  effect  of  a  technology  in   the  short  run     and     underesJmate  the  effect  in  the  long  run.”   Amara’s  law   Especially  so  –  as  digital  innovaHons  x-­‐ferHlize  each  others  –  and   this  may  take  Hme..  
  • 34. Real  Time  Economy  –  a  new  paradigm   1.  2.  3.  4.  5.  6.  Background   The  Real  Time  Economy  program   The  base  is  structured  e-­‐invoicing  -­‐  establish  it  fast   Move  to  the  next  layers  –  Data  ExtracHon   e-­‐  and  mobile  banking  criJcally  important   Conclusion  
  • 35. Of  course..   "We  tend  to  overesJmate  the  effect  of  a  technology  in   the  short  run     and     underesJmate  the  effect  in  the  long  run.”   Amara’s  law   Especially  so  –  as  digital  innovaHons  x-­‐ferHlize  each  others  –  and   this  may  take  Hme..  
  • 36. Start  early  –  let  mature  –  implement   gradually   “Any hype will do” Early start: “Explorer” Late (re)start: “Panicky follower” “ICE AGE” 2006-03-23 “ICE AGE” Page 36
  • 37. Technology  is  only  developed  when   used   The  early  automobiles:   •  They  looked  like  horse  carriages   •  They  didn’t    go  faster   •  They  open  had  break  downs   •  They  where  a  good  deal  noisier   •  and  a  man  with  a  red  flag  had  to  go  in  front   There  where  absolutely  no  ra8onal  reason  to  use  them   •        -­‐  but  they  where  the  start  of  a  revolu8on!  
  • 38. Should  be  remembered   It  is  not  DEMAND  that  creates  SUPPLY   It  is  the  other  way  around   Henry  Ford  
  • 39. “Do  not  go  where  the  puck  is  >     go  where  it  is  going!”   Wayne Gretzky 39   2010-11-21
  • 40. The future is not planned nor prognosed It is created ! Video: v=Kb3q2viAbbk& Thank you, 40