e-Invoicing Maturity Model

Publish date:

  Does your mind also feel dizzy when you hear all kinds of different  e-Invoicing terms like Portals, UBL2.0, Multi-corner Model, AES, OCR, XML, Service Provider and ERS? It can indeed be a big and wide spread landscape where you walk into. But where does your organization stand in this and which solution fits best […]


Does your mind also feel dizzy when you hear all kinds of different  e-Invoicing terms like Portals, UBL2.0, Multi-corner Model, AES, OCR, XML, Service Provider and ERS?

It can indeed be a big and wide spread landscape where you walk into. But where does your organization stand in this and which solution fits best with your needs? Even more difficult, how do you get to that solution?

It will take some effort to determine where you stand and how your grow path, to a next level of e-Invoicing, will look like. For this purpose Capgemini has created the e-Invoicing Maturity Model. This model reflects the seven different levels of e-Invoicing for inbound invoices. By growing to a next level the cumulative savings in money increase.


Level 1: Manual Invoice Entering

A company in this level does not participate in any e-Invoicing activities. The focus is mainly on manual processing of invoices with a high number of FTE. The processing therefore also takes a long time since there are multiple actors in the complete process. During the entering of the invoices matching to Purchase Orders is a time consuming task and quite often mistakes are made, because of this thorough checks have to be done to check if the invoice is right.


Level 2: Scanning Street

The implementation of a scanning street is a small and relative simple step into the world of e-Invoicing. The scanning and automatic recognition helps to speed up the process of invoice processing. It brings one way of working into the process and makes an invoice digitally available. This brings also the first benefits of a digital invoice, such as the easy of being to reproduce the invoice in just a few seconds. However still a lot of checks need to be performed. A next step in fine-tuning the scanning street would be to make it suitable to also process emails with PDF files. The emails can be send to a certain mail account which is polled and where the PDF files are automatically extracted and recognized by using OCR.


Level 3: Portal Solution

A first step in involving the supplier is a low-threshold solution. An internet portal solution is just that. It basically is a website where suppliers logon to and see all information in one place.

The supplier does not need a lot of high complex ITsystems to get his invoice sent out. He just needs an internet connection. For the buyer this means a first step into a world of processing without having to actual enter an invoice!

The invoice is entered by the supplier in the portal and from there it gets imported into the buyers system. An Accounts Payables clerk checks the invoice and can then send it into his own organization if approval is required. The entering and matching is now done by the supplier, saving the AP clerk time. This solution is often an add-on and no end solution, since it is not suitable for processing of invoices for suppliers with high volumes. But for a wide spread variety of small suppliers who occasionally send an invoice it offers a great step forward.


Level 4: Electronic Data Interchange Channel

Processing through an electronic data interchange channel is where the big savings start. In the past this were mostly EDI connections but nowadays it are mainly XML based standards for these kind of messages.

This is extremely suitable for high volume processing. A supplier who very frequently sends a bulk of invoices can be connected with this solution.  When a supplier creates the invoice in his system it is send directly to the buyer, who does not manually have to intervene since checks can be done automatically. This often brings a big savings since most of the times the top 10 suppliers represent 80% of the invoices.

Downside is that with each supplier a specific connection has to be set up. This results into a more complex IT landscape. Agreements have to be made with all suppliers on which standard is going to be used to transfer the (XML) invoices. Quite often it is the case that multiple standards will have to be maintained at supplier and /or buyer level.


Level 5: Service Provider Platform

To simplify the IT landscape and to be loosely coupled the downside from an Electronic Data Interchange channel can be turned around by using a Service Provider Platform. This is basically a hub which is put between the supplier and the buyer. There are multiple companies which offer this service. The buyer does not have to maintain a lot of connections with different suppliers but just with one platform. Invoices are received in one format and can be automatically imported with automated checks. Focus will be on the exception invoices rather than having to check if all are correct.

Service Providers have the advantage that they are specialized in transforming any given invoice format into the desired format for the buyer. This makes it very easy for a supplier to connect to the platform. They do not have to agree on a format with the buyer but can use their own. If a supplier however has multiple customers using different Service Providers he still has to connect to all of those.


Level 6: 4-Party Model

To tackle the supplier’s problem, of having to connect to different platforms, the 4-Party model has been created. Both the supplier and the buyer have their own service provider. The service providers connect to each other over the network and take care of all problems which arise when having different standards. This way both the supplier and buyer only need to have one connection and that is to their own service provider. With this solution in place a complete network arise where suppliers and buyers can easily connect to each other in very fast pace.


Level 7: Self Billing

As an ultimate solution for a buyer it would be most simple and effective to create the invoice itself. The buyer has made agreements with the supplier on what will be delivered against what cost. So once the receiving is done, a buyer also knows what he thinks should be paid to the supplier. It’s very convenient to be able to tell  a supplier exactly what he has delivered and what payment will be done in return. The supplier has to then do the check and see if he agrees on it. The supplier will have the advantage that the payment can be done very quickly. Although this solution will not work for all types of procured goods or services it does offer a solution for many. With this solution compliance to additional rules and regulation is required and also a proper control mechanisms needs to be in place. This requires a more mature organization.


In conclusion we can say that the higher the level of e-Invoicing, the higher the level of cumulative savings will be. In most cases a company will not use only one solution but will most certainly use a range. The key to success is to determine which to use in what situation and in what mix.

With this e-Invoicing Maturity Model Capgemini offers a structured way of overseeing the world of e-Invoicing and can help you determine where you stand and how to grow.

As a first step into this world Capgemini uses the ‘Exploration e-Invoicing’. The exploration is a small project in which together with your organization the consequences of the introduction of e-Invoicing, in terms of value and IT-architecture for your organization, are explored in more depth. The exploration consists out of two parts, a Value scan e-Invoicing and an Architecture scan and will take place in ten days. The final result will be a report of the  ‘Exploration e-Invoicing and will also hold a concrete set of recommendations which can be applied right away to set out on your very own grow path towards a more mature level of e-Invoicing.


If you would like to conquer the world of e-Invoicing and see what it can bring you, please do not hesitate to contact us.



Related Posts

Fusion Apps

Oracle Procurement Cloud Blog Part IX: Don’t push that red button!

Jeroen Sprangers
Date icon March 16, 2017

Being surrounded with all kinds of new technologies which you have to master can be a...


DevOps – integrate Oracle Developer Cloud with Slack

Johan Louwers
Date icon February 21, 2017

One of the most important parts of building a DevOps team is ensuring you have social...


Oracle Compliance Cloud Service

Johan Louwers
Date icon January 25, 2017

Having a governance, risk and compliance framework in place, embedding it in the...