SAN FRANCISCO - Though electronic bill presentment is picking up speed in the consumer segment, the lack of a standard invoice format is proving to be a barrier in the business space.
And with every industry requiring unique billing details, and some invoices running more than 10,000 pages, that problem may not be solved soon.
Scott Dunlap, the vice president for marketing at the financial management software vendor Avolent Inc. of San Francisco, said some large companies use as many as 5,000 invoice formats with their trading partners. Having a more uniform invoice format would quicken the often-tedious payment process, he said.
"We worked with one company that had more than 2,000 different invoice templates," Mr. Dunlap said. "We were able to get that down to 200, and that cut days out of the payment process."
Mr. Dunlap spoke in a panel discussion Tuesday at the fifth annual Electronic Billing, Payment, Presentment, and Invoicing conference here. The event was sponsored by Thomson Media, the publisher of American Banker.
Madhavi Mantha, the senior director for product strategy and marketing at BCE Emergis Inc., of Montreal, agreed with Mr. Dunlap that the sheer size of many invoice systems can be daunting. "Some invoices run into tens of thousands of pages, can cross thousands of cost centers, and will have thousands of line items," she said.
Mark Bunger, a senior analyst with Forrester Research, said the lack of standard formats is one factor inhibiting adoption of electronic invoicing. There has been some progress in creating basic formats, he said, but many companies are trying to automate their existing payment procedures first, even if they are inefficient. "We call it paving the cowpaths," he said.
Mr. Dunlap said there are some basic technology formats, including software languages such as XML and EDI, that can facilitate standard invoice templates, especially within the same fields. Furthermore, he said, consolidation within some industries has helped to standardize billing practices. For example, in the auto industry, the limited number of large purchasers has given each of them the clout to require suppliers to use similar invoices, he said.
"The core information is really the same," he said. "There are only three to four players, and that has forced standardization."
However, many other business segments are far more diverse. "In health care, we have 50 Blue Crosses and 50 Blue Shields," Mr. Dunlap said. "There is no standardization."
Mr. Bunger said individual companies have tried to create basic standards, and to a small degree these have become prevalent within industries. But there is little overlap among major industries, and that is an obstacle for vendors hoping to sell their wares to more than one industry.
Furthermore, the few standards that are in place within market segments carry little weight, Mr. Bunger said: "There are some XML standards within industries, but they aren't largely adhered to."
Ray Simonson, the chief technology officer at CheckFree Corp.'s I-Solutions group in Norcross, Ga., said that standardization is not a difficult challenge because even massive invoices are often filled with similar line items. "There are not always a huge amount of variables," he said.
Jeetu Patel, an executive vice president at the Chicago market research firm Doculabs, said the expense is also holding back electronic invoicing in the business-to-business space. "The biggest barrier is funding from upper management," he said. The poor economic climate has led to some very tight purse strings, "and when funding does open up," electronic invoicing "is not the first thing that usually comes to mind."
