The Perfect Order and the Industrial Internet of Things Invoice

A perfect order is an order that arrives at a customer's site on time, complete and undamaged, and is billed correctly.  From a logistics perspective, we know that by getting the order there on time, in full, and undamaged the chance that it will billed correctly greatly increases. Doing the logistics pieces right also means that expensive billing reconciliation processes are less likely to have to kick in place.

Having a public cloud solution (or B2B network, or platform as a service, whatever phrase resonates with you) sit in the middle can be very helpful.  So for example, public cloud transportation management systems (TMS) allow shippers to procure transportation from carriers in such a way that there is much less room for billing disputes.  The shipper tenders, the carrier accepts, and the rates of record are in the public cloud.  Any debate is centered on destination events:  Did the carrier show up on time?  Is there a penalty for that?  Did the shipper make the carrier wait in the yard?  Is their demurrage that results from that?

To the extent that a TMS becomes able to integrate GPS, digital pictures, and RF scans into the digital invoice, even these disputes disappear.  GPS helps to resolve on time and demurrage issues.  Digital pictures help to speed product damage disputes.  And scans of pallets off the truck help to prove the right quantity was delivered.

In short, an electronic super invoice containing the complete set of pertinent Industrial Internet of Things (IIoT) data, could speed payments and make resolving billing disputes less likely and less costly.

In other cases, the invoice would need to contain other forms of IIoT data.  For example, prescription drugs should contain sensor data related to heat, temperature, and light to prove the potency was not adversely affected by poor logistics.  Or a shipper that wants to use green carriers might want to append the trip's fuel consumption.

In other cases, however, static orders are not the norm.  When we are talking about dynamic ordering and payments, things become more complex.  So imagine a food distributor delivering produce to restaurants.  The store manager might say, "I know I only ordered three cases of lettuce, but is there any chance you can give me four?" 

In these types of situations, what happens at the stop is where the complexity shows up.  The distributor needs to show up with a pro forma invoice, but then needs to produce new invoices on the fly complete with discounts that apply to that specific customer.  Mobile resource management solutions, like Airclic (which was acquired by Descartes), have become more industry specific to handle this last mile, industry specific complexity.  But these are not public cloud solutions where common commercial master data resides.  This means "he said, she said" style disputes can still occur. 

Public cloud solutions are interesting when it comes to eliminating friction in the procure-to-pay process, and smart IIoT invoices will only improve this process.  But it is still a bit like the Balkans when it comes to public cloud providers and digital marketplaces; too many small nations that don't always play nice together. 

Posted in IIoT and I4.0 Viewpoints