We started partially switching to ODE back in 2018. The main reason was the requirements of the modern world. Because if you want to be competitive and move with the times, the transition to e-documents is an inevitable step for business.
Results of ODE implementation
What documents does Metinvest-SMC have in e-format?
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1Almost all of our internal documents are in electronic form: orders, statements, conclusions of internal commissions, protocols, etc.
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2Speaking of external documents, about 50% of our partners have switched to ODE. Any documents related to interactions with clients: invoices, adjustments, specifications, contracts — all in the e-format.
However, we still have to work in paper form with another half of our partners who do not use ODE for various reasons.
Why do clients often refuse to switch to e-document flow?
We have noted several of the most common reasons for refusing to switch to ODE:
- a company is not technically ready for the transition;
- there is internal resistance from employees based on outdated stereotypes about document workflow;
- small companies find it economically unprofitable.
About the benefits of ODE from the real-life case of Metinvest-SMC
The management of the enterprise has to make decisions very quickly if it wants to compete in the world of today. Especially when the country is at war. Decisions must be balanced and based on certain calculations, analysis, and comparisons. It is important that all this information comes from the accounting system.
That is, to take data from the accounting system, analyze it, automatically generate a report or some kind of analysis, and promptly transfer it to the management for further decision-making. E-document flow, in particular the Vchasno service, facilitates the timely reflection of data in the accounting system.
Request a demo of the Vchasno service
During the online meeting, you will learn how e-document workflow can simplify and speed up the exchange of documents in your company.
Advantages of ODE as seen in practice
Daily updated information
Today, most businesses have increased control over working capital and analyze their operations on a daily basis. It is important for us to know what our receivables are every day, whether there are overdue debts, how much money arrived, who we have to pay, and what our stock balance is. How long has it been stored, maybe we need to do something with it, and so on.
We also check the net balance with our group companies. Therefore, daily updated and relevant information in the accounting system is a matter of great importance. Vchasno makes this process faster and easier.
Fast financial transaction cycle
Metinvest is a leader in the supply of metal products in Ukraine with a rich and diverse customer base. We work with various types of payments: delayed payments, advance payments, etc. Therefore, it is important for us to mitigate our potential risks of non-refund or late refund. For this purpose, to speed up the refund process, we use various financial instruments, such as a bank guarantee or factoring.
How does this work? For instance, if today we have delivered products to a counterparty and signed documents in electronic form, the same day the documents will be reflected in our local system. Then, if necessary, we sign the documents online in Vchasno and sell the debt to the bank the same day. As a result, we receive the funds for the goods we shipped in the morning that very day.
It became possible to perform such a transaction in one day only with the help of e-document flow. While with paper documents, it would have taken a week: we would have had to find free time for the signatories, spend a lot of time sending documents by mail or courier. Especially now, when the country is at war and the signatories may be in different parts of the country or even abroad. In other words, paper documents extend the cycle of this transaction for a rather long period, and sometimes make it impractical and too costly.
It's easier to undergo audits
We recently had an audit for 2021. There was a request for two different clients: one of them works with us in the Vchasno service, and the other works with paper documents. As a result, it took us 10 minutes to provide information on the first counterparty for verification, and several days to collect information on the second one.
Some employees work remotely, while paper documents had to be searched in the archive, scanned if necessary, and then sent to the auditor. It’s time-consuming, inconvenient, and slow.
You also have to consider the risk of damage and loss of documents: many companies are now located close to the war zone. That means e-documents provide more security and comfort for employees.
New challenges in the processes
At the end of 2021 and in 2022, Metinvest had ambitious plans for the further development of its ODE system. We planned to integrate our system with platforms or systems that offer us working in e-format. Today we use several systems.
The company takes into account which system our client is working with and tries to adjust to make it more convenient. This allows us to save the manager’s time and the accountant’s time for revision, and to sign a document in one system and automatically send it to another. We have even developed business requirements for this process, but the war has made its own adjustments, so this project has been postponed for now.
Why is it so important to involve the finance department in the process of implementing e-documents?
We can say for sure that the finance department should be involved in all processes in the enterprise. Even if you don’t want to involve the finance department, it will be involved in one way or another.
There is even a common saying: «If you don’t know who to ask, ask a financial expert». Because any technical or commercial process requires a certain economic analysis, justification, and checking for possible risks. In this respect, ODE is something that directly affects the work of the financial function.
Real-life experience of implementing an e-document flow is discussed in an interview with Andrii Shevtsov, CFO of Metinvest-SMC
Watch the full interview:
