The Peppol network’s approach to electronic data management makes doing business more efficient and easy. SOK is waiting for Finnish SMEs to adopt the use of Peppol for receiving their orders in the future.
According to Jukka Muhonen, the leader of SOK’s retail integration team, the clearest benefits of electronic data management are that it saves time.
− When a buyer has an order in their own information system, their supplier will still need to process it in their own system, so the most hassle-free option is to let these systems do all the talking, Muhonen explains.
Muhonen believes that SMEs should also migrate to electronic data management.
− Most entrepreneurs probably have better things to do than manually recording documents in their systems.
Peppol is suitable for SMEs
The Peppol network helps corporate information systems connect and interact in a way that avoids the issues of having just two-way connections. The network can be used to transmit many types of documents, such as standardised orders, order confirmations, and invoices. Its objective is to boost the use of electronic business processes by improving efficiency and reducing costs.
Currently, SOK’s electronic data transmissions are based on the EDIFACT format. SOK also began using Peppol at the end of 2023.
− When we started building our new ordering system, Peppol was the natural choice for its native messaging format, as Peppol is heavily standardised and has amassed a lot of users, Muhonen notes.
Muhonen feels that SMEs in particular stand to benefit from adopting the use of Peppol order messages in their ERP systems, as building new EDIFACT connections can be a time-consuming process.
− Peppol is based on the XML format, which makes it a better choice, especially for smaller companies with less IT expertise. SOK, on the other hand, can also enhance its business with Peppol’s electronic procurement messages, as it supports the creation of delivery messages and invoices that can be specified down to an individual row in an order, Muhonen says.
Looking for high-quality delivery messages
It is important for SOK to receive its delivery messages and invoices from suppliers electronically. But if a supplier wishes to effortlessly transmit high-quality procurement messages to SOK, it must also be able to receive SOK’s order messages electronically to its own ERP system.
According to Muhonen, other purchasers are likely to demand increasingly high-quality delivery messages and invoices from their suppliers, as they allow purchasers to automate their own operations. For example, the state has introduced Peppol-based procurement messages and is set to mandate their use from its suppliers whenever they fit a procurement.
− How much manual work a supplier causes to a buyer may affect their future supplier choices.
− SOK expects Finnish SMEs to adopt the use of Peppol-formatted orders and that they will be able to send their delivery messages and invoices electronically to SOK.
Peppol is set to grow
Muhonen predicts that the use of Peppol procurement messages will experience the same explosive growth as e-invoices did at the turn of the millennium. He feels that today’s companies value the clarity of a message more than how compact they can be. Peppol’s international status is also a valuable asset.
− As we make changes to our systems, we may be able to replace our larger-volume EDIFACT connections with Peppol, once we have verified the functionality of Peppol’s transmission infrastructure, notes Muhonen.
To date, SOK has taken small but determined steps in its use of Peppol. According to Muhonen, while SOK’s Peppol volumes have remained small, they are growing steadily.
− In the near future, we will begin using Peppol with specific supplier connections. This will also allow us to fine-tune our transmission infrastructure and the data contents of our messages. We’ve also been involved in a State Treasury-led working group that is preparing a Peppol application guideline for the Finnish commerce sector. I believe that this guideline will be useful for many actors that produce and read Peppol procurement messages – especially software vendors.
The state also supports the promotion of Peppol messaging through its support programme for the deployment costs of Peppol application services. Its objective is to bring the benefits of the Peppol network and electronic ordering to Finnish SMEs while also boosting the use of Peppol messages in Finland. Read more about the Peppol support programme.
