We live in a real time economy. The availability of media and communications mean that we can make quick decisions based on more information than ever before.
The impact that this has on a business can be felt in a number of areas, not least of which in financial processing. Demands for real-time information on cashflow, debtors, cash reserves and more have never been higher – but the challenge is implementing the tools that will give you that information.
The reality of the situation is that many organisations are drowning in paper when it comes to invoicing and financial management. Not only does paper move slowly, but it is also a slave to human error and/or oversight. Just one invoice left at the bottom of an in-tray, for example, can undermine great efforts to speed up the process in other areas.
The question of how to make e-invoicing and e-payments ‘Just-In-Time’ (JIT) is something that we’re very familiar with at Basware, because of our work with the automotive sector. We have worked with most of the big manufacturers in this industry and one of the top priorities is translating a lot of complex requirements into automated processes. This then supports the JIT process that has characterised the industry for the last 60 years. Right now we’re doing a lot of work with BMW and Daimler to extend their supplier networks globally, lately especially in China, from the strong bases we’ve helped them establish in Europe.
This helps them to speed up financial processes through e-invoicing and accounts payable / accounts receivable automation. This allows companies to operate in the real-time economy. Decisions can be made more quickly and accurately, which supports our JIT approach around e-invoicing and e-payments. Not only does that mean speed, but it means control. The ability to negotiate with suppliers to change prior arrangements / payment terms to better suit the circumstances, for example.
Once new terms have been negotiated, executing a speedy payment becomes just as important, to gain maximum benefit. Basware’s recent cooperation with MasterCard, which delivers global e-payments embedded into the e-invoicing process, ensures the buyer and supplier benefit from quick, guaranteed payment. Embedding it in the process also integrates rich remittance data to boost their accounts receivable process efficiencies.
This kind of flexibility allows companies to adapt their core financial processes to suit their needs at any given time.
This approach to financing is very similar to the JIT principles that our auto-industry partners have made so famous. If you need to supply one million or ten million cars, your manufacturing operation should be oriented to producing that many. The ‘market’ conditions dictate the operation of the company. This ensures that you’re always in the best situation possible to make a profit.
There are many companies out there with complex requirements for how they / their suppliers operate. Ultimately, there are ways to simplify those processes, automate them and then manage them in a way to maximise profit.
You can learn more about our expertise and offering on the automotive industry in Basware’s whitepaper “Electronic Invoicing in the Automotive Industry”,