1.
Get Smart
Get Smart—The CFO’s Gateway to Supply Chain Efficiency
The concept of a smart economy doesn‟t sit comfortably with a business sector that is still heavily
reliant on paper. Take invoices: arguably the most important business document there is, since
without it, no-one gets paid. Maybe it‟s a holdover from the „cheque‟s in the post‟ culture, but
British businesses still overwhelmingly use paper and postage rather than an electronic
equivalent.
With the ongoing tribulations in the British economy,
Get Smart this year has seen no shortage of calls for change, but
appealing to CFOs‟ patriotic nature with some big-
picture initiative will cut little ice with many firms
Eliminate all costs associated with focused inwards, looking only at where they can cut
conventional, paper-based sys- costs in their own business in order to survive.
tems
The good news is, the two goals don‟t have to be
eInvoicing is a realistic business
option for all companies mutually exclusive. A recent report produced by the
Swiss group Billentis estimates that an average
Businesses on average can save business can save between 1 and 2 per cent of its
between 1-2% of turnover by
turnover by switching from paper to electronic invoicing
switching to eInvoicing
and by automating the related supply chain processes.
Invoices are issued and sent
immediately to customers resulting The „E-Invoicing / E-Billing in Europe and abroad‟ report
in a quicker payment cycle makes the case that replacing paper-based invoice
Streamline the entire supply chain, processing with electronic and automated methods
both upstream and downstream offers savings ranging from 60-80 per cent. What‟s
and achieve efficiencies of scale more, it says an e-invoicing project can begin returning
on its investment as rapidly as six months from the start
date. The report found that organisations moving to
e-invoicing often find a ratio of 70 per cent to 30 per cent in favour of electronic documents over
paper, so the savings quickly become apparent.
This also addresses another hidden cost within business. According to estimates from the
research firm Gartner, managing a piece of paper costs nine times the price to print it in the first
place. Then there‟s the environmental advantage of removing large volumes of paper. Green
initiatives may have fallen off the business agenda lately but any EU or Government mandate on
carbon footprints would suddenly bring this issue sharply back into focus.
High tech, low price
Not so long ago, automating an accounts receivable system would once have been the exclusive
preserve of large corporations, with multi-million budgets to match. Technology, one of the
business world‟s great levelers, means the same facility is now available to small and medium
sized firms at a fraction of the cost.
To draw on another smart economy mainstay, we believe cloud computing has a huge role to play
in making this happen. Cutting through the hype, what this means in simple terms is that the
information can be stored in one central place and accessible over the internet from any location.
© Celtrino 2011. All rights reserved. t: +353 1 873 9900 e: GetSmart@celtrino.ie www.celtrino.ie Page 1 of 3

2.
Get Smart
High tech, low price (contd.)
In the context of this discussion, the concept is essentially a „clearing house‟ for electronic
invoices. By storing everything in one location, the scenario of lost, and therefore unpaid invoices,
disappears. E-invoices are routed directly to customers and the status of any transaction is
immediately transparent to buyer and seller.
Straight away, an accounts receivable system provided this way removes the need for individual
businesses to invest capital expenditure in their own systems for handing e-invoices, as well as
the op-ex required to manage those systems. All that‟s needed is a web browser to log in, view
invoices, approve them and submit proof of delivery. From the supplier‟s point of view, if the
customer has a query relating to the invoice that‟s instantly visible, eliminating any potential
backlogs and blockages in the approvals process.
Beyond cap-ex, further savings are made because the work involved in processing invoices
manually is removed – to say nothing of storing and tracking them should they be needed later.
The „hard‟ cost saving is a faster sending of invoices and eliminating postal charges. The soft
costs are that it speeds up the process, there are fewer queries in relation to invoices and
therefore administration staff become more productive because they can spend time on other
tasks.
Eliminating errors
It also leaves the process open to mistyped information such as order numbers or delivery dates.
Any mistakes may not be picked up until much later, further slowing the payment process down
and potentially harming goodwill from suppliers at a time when good customer relationships have
never been more valuable.
Some CFOs may be reading this and think „I don‟t need this, I already send my invoices by email‟,
but that still puts the onus on the other party to read the invoice, and to input the details on their
own system.
We would argue that the incentives to deal with customers via e-invoicing are too big to ignore.
Firstly, the simpler and faster process of approving invoices means that suppliers can be paid
quicker and consequently their cashflow position improves. In turn, making it easier for customers
to process e-invoices means they will be more open to meeting a supplier‟s payment terms. It be-
comes, in other words, a virtuous circle.
Since 2004, the EU has recognised the status of e-invoices and they are legally accepted in mem-
ber states. The Billentis report refers to a sample survey by the author Bruno Koch which found
that in the past, smaller customers perceived moving from paper to e-invoicing as “nice to have”,
whereas larger organisations tended to use it as a mandatory requirement for doing business with
them. Koch argues that increased cost pressures and competition in the future will soon force the
optional to become obligatory.
© Celtrino 2011. All rights reserved. t: +353 1 873 9900 e: GetSmart@celtrino.ie www.celtrino.ie Page 2 of 3

3.
Get Smart
Eliminating errors (contd.)
Moving a customer-supplier relationship onto an automated accounts receivable platform has
never made more sense. Large parts of the cost have been stripped out, clearing one of the
largest single obstacles from the process just when it is most needed. Doing so has the potential
to benefit both the wider economy and the individual business, without imposing a suffocating
straitjacket on either.
Ten years ago, the UK Government‟s ambition was not to build a smart economy but to make
Britain a hub for e-commerce. E-invoicing has the potential to turn both nebulous concepts into
something more tangible, because without the invoice there is no transaction. This is real e-
commerce. It is the smart move to make and the time to make it is now.
Celtrino
Celtrino specialises in business process and supply chain document automation solutions. With over 20 years of successful trading
under our belt, Celtrino has consistently delivered outstanding business value to a customer base of over 600 companies of all sizes,
from sole traders to multinationals.
As a pioneer in the provision of outsourced managed EDI services, Celtrino has long championed and delivered innovative reliable
and feature rich on-demand supply chain solutions via the cloud.
Celtrino Platform
The Celtrino supply chain automation platform is purposely designed to scale to meet the huge volumes of inter-company B2B com-
mercial transactions whilst providing the highest level of performance, reliability and business continuity through a fully redundant and
secure architecture. The Celtrino B2B platform enables a suite of touchless services to be delivered via Software-as-a-Service (SaaS)
which offer a dramatically faster implementation process.
© Celtrino 2011. All rights reserved. t: +353 1 873 9900 e: GetSmart@celtrino.ie www.celtrino.ie Page 3 of 3