NHS Shared Business Services – Progress with Their eInvoicing Initiative

We caught up with Simon Murphy, CFO at NHS Shared Business Services (NHS SBS) recently, mainly to have a chat about their programme to increase the use of eInvoicing. You may remember in previous installments of that story, NHS SBS was using OB10 eInvoicing system, but a year ago also engaged with Tradeshift to start making use of that very user-focused platform.

The objective was to make it easier for the many, many small suppliers whose invoices are paid through NHS SBS to use eInvoicing. It's worth noting - as it is relevant later on - that NHS SBS acts as an outsourced service provider for their customers, who are NHS hospitals and other health organisations. So the invoices don’t relate to suppliers doing business with NHS SBS itself.

We started by asking Murphy how the programme is going.

“It’s going well, but supplier adoption is slower than we would have liked. We have around a third of the major suppliers now using e-invoicing, but the overall percentage is lower than that”.

Why is it proving tough to get adoption?

“A lot of it is the sheer amount of supplier data. We process invoices from some 175,000 suppliers. Often just verifying their basic details and contacting them is a challenge. Then we have to find the person who can actually make the decision to switch to eInvoicing ... It is a change management task really, and often it is literally one supplier at a time”.

Can’t NHS SBS and your customers help by pushing – or even mandating - suppliers to switch?

“NHS SBS can't mandate the use of eInvoicing - it has to be our clients who do that with their supply base. We have some 300 customers, and yes, some have done that. Where that has happened we see much greater adoption and usage, but not many customers have taken that step yet. That is the best way of making progress, and often if a supplier switches because of one customer, then of course that supplier can use eInvoicing for all their customers that work with us. Southampton Hospitals is a good example of success, driven by a proactive team there”.

How have you, your customers and their suppliers found working with the platform?

“Good – for instance, one benefit of the Tradeshift platform is that you can’t send an invoice unless it is correctly completed. So there is built in system validation. Once suppliers are signed up, it works well – we’ve had good feedback on the platform from suppliers. There is no scanning or workarounds, it is a simple and good concept. It has been the execution of the change that has proved tricky”.

What comes next in terms of SBS, Tradeshift and the platform?

“Tradeshift has ambition and vision, and they are continually developing - we are pleased with their call centre improvements and improved self service options for instance. And they want to be more than just an e-invoicing platform. There is potential around other aspects of purchase to pay, and we’re sharing plans with them, but the e-invoicing programme has to come first”.

What about supply chain finance – is that in the forward plan?

“Yes, but the devil is in the detail. Issues such as approvals become important, we think there will be some cultural change needed amongst our client base before SCF is likely to become established”.

Will you continue running with both the Tungsten and Tradeshift platforms?

“Where firms were using OB10/Tungsten, usually large suppliers, we have not pushed for change so that is generally continuing - although there are now also large suppliers using the Tradeshift platform. We may eventually end up with just one option but it isn’t the best use of resources to make resolving that the top priority currently”.

Do you see the EU mandate for eInvoicing making a big change?

“It is not a big issue at the moment but there are campaigns to encourage people to adopt eInvoicing such as the Department of Health’s eProcurement strategy.”

So, what lessons can we learn from this? Well, it is good news for Tradeshift, in that they have a good reference site / client in SBS, saying positive things about the firm and the product. But the NHS SBS experience highlights that eInvoicing is not a “quick win” in many cases. It can be tough – and their experience also suggests that if you want rapid uptake of eInvoicing, a degree of mandating suppliers is probably necessary.

Indeed, the experience suggests that it is going to be a long slow journey to get eInvoicing really established everywhere and seen as the standard process. In the public sector, the EU has mandated that public authorities must be able and willing to accept eInvoices by 2018 - but of course that doesn't mean suppliers must use it. It may well be that authorities or nations will need to push suppliers if they want to realise the undoubted benefits of the process. And thanks again to Simon Murphy and NHS SBS for talking to us.

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