E-Invoicing: Lessons Learned from GSK’s 15-Year Journey

GSK, a global biopharma leader, has established itself as a pioneer in the adoption and optimization of e-invoicing over the past 15 years. With global sales passing £30 billion in 2023, GSK processes approximately one million invoices annually across 26,000 suppliers, amounting to about £9 billion in spend. Their comprehensive approach to e-invoicing offers valuable insights for businesses aiming to streamline financial operations.

For more detail on GSK’s e-invoicing journey, watch the webinar

What is E-Invoicing, and Why Does It Matter?

E-invoicing, or electronic invoicing, replaces traditional paper invoices with a digital process that ensures accuracy, reduces manual intervention, and speeds up payment cycles. GSK’s use of Tungsten Network to process 35% of its global invoices has enabled the company to achieve 38% completely touchless transactions, showcasing the efficiency potential of well-executed e-invoicing systems.

Supplier Onboarding: Setting the Foundation for Success

A key challenge in scaling e-invoicing is supplier onboarding. Supplier onboarding involves gathering information about prospective vendors, evaluating their compliance and risk profiles, and seamlessly integrating them into your platform and supply chain. GSK has refined its approach to ensure seamless integration:

1. Clear Expectations: In partnership with procurement, define e-invoicing goals in terms of efficiency, compliance, and effectiveness.
2. Proactive Onboarding: Enable suppliers to submit their first invoice electronically by embedding e-invoicing requirements in onboarding processes.
3. Tailored Strategies: Segment suppliers into strategic, tactical, and tail categories to allocate resources effectively. Strategic suppliers typically onboard quickly, while tactical and tail suppliers require tailored strategies, such as using supplier portals or aggregators.
4. Incentives: Highlight benefits like timely payments to encourage supplier adoption.

Procurement’s Role in E-Invoicing Success

Collaboration between Finance and Procurement is critical to an effective e-invoicing program. At GSK, Procurement plays a pivotal role in supplier communication, emphasizing the importance of compliance with e-invoicing requirements. Here’s how Finance and Procurement align their efforts:

• Unified Messaging: Procurement leads supplier discussions, ensuring the e-invoicing message aligns with broader business goals.
• Integrated Processes: E-invoicing campaigns dovetail with existing supplier onboarding programs, leveraging Procurement’s resources.
• Strategic Influence: Procurement ensures e-invoicing clauses are included in supplier contracts, reinforcing adherence during reviews.

Overcoming Challenges: GSK’s Inflection Point

Despite its early success, GSK faced a period of stagnation in its e-invoicing program due to supplier churn and onboarding delays. This prompted a renewed focus on touchless processing and revitalized strategies to maintain momentum. Key actions included:

• Re-evaluating goals to prioritize touchless invoices.
• Strengthening partnerships with suppliers and Tungsten Network.
• Monitoring metrics to identify and address barriers to first-time match rates.

Best Practices for E-Invoicing Implementation

GSK’s e-invoicing journey highlights six actionable best practices for businesses:

1. Align Stakeholders: Ensure Finance and Procurement share consistent goals and expectations.
2. Prepare Early: Enable suppliers to submit electronic invoices from the start of their relationship.
3. Leverage Networks: Partner with established e-invoicing networks to streamline onboarding and utilize proven best practices.
4. Monitor Progress: Regularly track metrics to identify growth opportunities and optimize processes.
5. Stay Agile: Avoid complacency by continuously evolving your program to address changing landscapes.
6. Foster Collaboration: Build transparent, supportive partnerships with e-invoicing providers.

Looking Ahead: The Future of E-Invoicing

As government mandates for e-invoicing increase and suppliers grow more accustomed to digital processes, the transition to e-invoicing is becoming the norm. Businesses like GSK demonstrate that a strategic, collaborative approach to e-invoicing can lead to significant efficiency gains, cost savings, and enhanced supplier relationships.