Universal Business Language could cement standard, Canadian adoption

I remember a CIPS talk I attended in Ottawa quite some time ago where Douglas Mulhall (author of “Our Molecular Future” predicted there was “GRAIN” in our future (i.e. the future of IT professionals).

This stood for:

  • G – Genetics
  • R – Robotics
  • AI – Artificial Intelligence
  • N – Nano technology

Each of these fields involves a very large body of information processing.  For those in the audience who thought IT was merely writing one more Payroll or Accounts Payable program, this was somewhat of an eye opener.  My specialty lately, involves the use of the OASIS Standard Universal Business Language (UBL).  I decided to add an “S”, giving me “GRAINS”, since I believe that global OPEN standards are becoming critical to an ever increasingly connected planet.

I also have a colleague that has spent much of his life working away at robotics and AI, so I asked him about his 2014 predictions for these fields.  I present this in a separate blog article.  I do not have any relevent expertize in either Genetics or Nanotechnology.

I will tackle the UBL predictions in three categories:
•    Standardization of UBL
•    Global Usage of UBL
•    UBL e-invoicing infrastructure

Standardization of UBL

So, what is likely to happen with UBL in 2014?  Barring any major disruptive innovation, predicting the future is usually extrapolation of the past.  So first, let me quickly discuss the past and then extrapolate into 2014.

Development of UBL, the Universal Business Language was started  in mid-1999 by the Organization for the Advancement of Structured Information Standards (OASIS).   To answer the question “What is UBL?”, they say:

“UBL, the Universal Business Language, is the product of an international effort to define a royalty-free library of standard electronic XML business documents such as purchase orders and invoices. Developed in an open and accountable OASIS Technical Committee with participation from a variety of industry data standards organizations, UBL is designed to plug directly into existing business, legal, auditing, and records management practices, eliminating the re-keying of data in existing fax- and paper-based supply chains and providing an entry point into electronic commerce for small and medium-sized business.”

Notice that we aren’t talking about applications, or any significant modifications to existing systems – we are talking about a standardized way of representing the content of common business documents that are exchanged electronically between organizations in a customer/supplier relationship.  If you are asking why we might need such a standardized way, consider other infrastructures on the planet and the difficulties we would have if we didn’t standardize.  Common things like electrical distribution systems, building practices, railroads, screw/screw drivers, computer architectures, and a multitude of things we take for granted would be a nightmare if everyone insisted on implementing their own proprietary way of handling these, an an attempt to “lock in customers”.  It is no different in the domain of information exchange between organizations.  If we are going to talk business on a global basis, we will have to use a language that everyone understands.

It is almost certain that in any customer/supplier relationship, there will be a different IT system in use at either end of this channel.  A customer with multiple suppliers cannot force their suppliers to adopt their particular iT solution, and each supplier with potentially thousands of customers cannot afford to adopt/support a different interface for each customer.  This has led to the situation where the most common way of interchanging information such as purchase orders, invoices, shipping tickets, credit notes, etc. is on paper, or at best as a PDF attached to an email.  For the customer, this can represent a huge expense – converting information that started out electronically, transported on paper, back into a correct electronic form that they can use.

For true electronic exchange of business documents, three challenges have to be met:
•    Technical changes to existing customer/supplier systems should be minimal – ideally zero.
•    Process changes to current workflows for both customer and supplier should be minimal – ideally zero.
•    Suppliers will not pay to send invoices.  Cost should be minimal – ideally zero.

Since UBL is designed to merely plug into the back end of existing systems, the above challenges can be met.

UBL 0.7 was release in 2003, and UBL 1.0 quickly followed in 2004.  This version provided standard definitions for 8 common business documents.  The number of business documents increased to 31 in Version 2.0 and 65 in version 2.1,  Version 2.1 reached recommended status in late 2013.  It is unlikely we will see another UBL version in 2014.

What we might see late 2014 (or early 2015) comes from Ken Holman, current co-chairman of the OASIS technical committee for UBL.  We might see the possible emergence of OASIS UBL as an ISO standard. OASIS  (and end users) will benefit by having the UBL 2.1 OASIS Standard able to be referenced or embraced by national bodies that are currently prohibited by internal rules from considering specifications not endorsed as de jure standards.  OASIS has submitted UBL 2.1 to to the ISO/IEC Joint Technical Committee 1 (JTC 1) for approval as a proposed International Standard.

Global Usage of UBL

Since the initial release of UBL 0.7 in 2004, adoption of UBL has increased significantly and rapidly.  In 2005, the country of Denmark legislated the use of UBL when invoicing the government of Denmark.  The EU adopted UBL as one of two supported standards for its PEPPOL project.  Access to the PEPPOL network is via access points.  There are open-source solutions of the PEPPOL Access Point software freely available, and approximately 60 companies offer AP services to their customers across Europe.  The architecture has fostered a market of AP services provision where companies can compete with other companies in the kind of services they provide through the open portal to all of the participating PEPPOL companies and governments.

Many other countries have chosen UBL for the standardized content of business documents. By the end of 2013, UBL was in use in over 190 countries.  Canada is a significant exception so far.

Michael Geist, who holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, published a piece entitled “Technology and the Law in 2014 – 14 Questions in need of answers.”  His number one question was “Will the government finally unveil a national digital strategy?“.  His prediction is that this national strategy may be revealed in 2014.

One potential clue to part of this national digital strategy, was the Canadian governments release of a RFI and Draft RFP for the development of a digital portal/infrastructure to allow Canadians to invoice the government electronically.  The existence of such an infrastructure could easily result in over $1 billion cost savings over the next decade.  We expect the final RFP to emerge early 2014, and award of contract, and beginning of work to start before the end of 2014, potentially being available for use in 2015 or earlier.

One question of course is whether or not it will based on international open global standards.  One key advantage for using open standards is that it would be available to all, and could launch new markets for provisioning of services as has happened in the EU.

If the experiences of other countries are any indicator for Canada,  having a national infrastructure for the exchange of business documents using UBL, will not only enable B2G e-invoicing but also B2B e-invoicing.  This was illustrated by the Danish experience.  Using UBL means that not only invoices, but the other 64 business documents could also be be implemented within this same infrastructure.

In 2014, we expect the global adoption of UBL to continue, and that Canada (hopefully) will not adopt anything other than the OPEN UBL standard for the content of all electronic business documents.

UBL e-invoicing infrastructure

My company is a founding member of the UBL Business Ecosystem.  The site was founded and is run by a commercial ecosystem of cooperating companies offering products, services, training and resources related to UBL. While our primary market is focused on North America, we can help you find someone or help you ourselves regardless of where in the world you need our assistance.  Ken Holman, mentioned above, the CTO of Crane Softwrights, is another founding company of this business ecosystem.

We try to keep on  top of UBL developments world wide.  One key development that seems common across many existing systems is the ability to import/export XML documents.  Since UBL documents are XML documents, this means that many large scale systems can now receive and send UBL documents.  All that each individual system requires is a single conversion from UBL to whatever proprietary form the system requires.  Standard XSLT processing is available for this conversion task, and XSL-FO is available if paginated output is required.

The real problem though for any customer, is to get all their suppliers to send their invoices in electronic form.  This “on-boarding of suppliers” has proven to be the major stumbling block for customers (See my three challenges above).

One company in particular that we have been following is Tradeshift.  The people who formed Tradeshift previously worked on both the Danish and EU implementations of e-invoicing.  They concluded that a commercial generalized infrastructure was a distinct possibility and the Tradeshift product and company were the results.

The Tradeshift product is based on UBL.  UBL is designed to plug into existing business, legal, auditing and records management practices in any organization.  There is no requirement for either the customer or supplier to change their existing systems, work flows , policies or procedures.

As an example, Intuit recently signed an agreement with Tradeshift allowing them to provide a back end interface from Intuit to the Tradeshift network.  This is pretty much invisible to current users of Intuit software, but then allows Intuit users to submit invoices electronically, in standard UBL, to any  organization on the planet.  The addition of over 5 million Intuit users, made Tradeshift the largest and fastest growing e-invoicing platform on the planet.

Tradeshift has adopted a business model providing free e-invoicing services to all customers.  Revenues are generated, not by charging a fee per invoice to suppliers, but by supplying value added services to the large corporations who are the ones who have the huge expense of converting millions of invoices from paper to electronic form..

The Tradeshift infrastructure is implemented as a SaaS in the Cloud.  The infrastructure is designed to support user generated Apps in their App store   It also includes social networking functions to allow real time conversations between customer and suppliers around individual invoices.  New functionality like CloudScan and Dynamic Discounting are added to the base functionality.  Dynamic Discounting can be a significant tool for small business.  This feature allows a supplier to offer a % discount off an invoice, provided the customer pays early.  A small business can improve their payment cycles, and the customer saves money via the discount.

Since onboarding of suppliers is a major stumbling block, Tradeshift offers tools and services to provide the customer with 100 per cent onboarding.  New features like workflow is a way for colleagues to act on, process and collaborate around key business interactions in real time, no matter where they sit in your organization.

IN 2013, Tradeshift moved their corporate headquarters from Denmark to San Francisco to start their entry into the North American marketplace.  I expect to see their expansion to continue on its exponential growth curve in 2014, and that major corporations and SMEs adopt Tradeshift as their primary e-invoicing exchange platform.

Although the details of Canada’s EU Free Trade agreement are yet to be revealed, I expect corporations of all sizes to start getting interested in how they can meet the EU requirements for e-invoicing.  A previous article I wrote detailed how a North American company can use Tradeshift to invoice any EU company electronically for a minimal cost.

I see 2014 as the year that we finally get some momentum for the use of UBL in Canada.  Companies such as Tradeshift might have been first out of the gate in providing a UBL based e-invoicing infrastructure, but I expect to see multiple other companies emerge to solve this problem.  As long as they support OPEN standards and provide portals to other networks, these companies can compete on service and features.

Overall I see 2014 as a critical year for UBL adoption in Canada.

UBL References:

Hugh Chatfield
Hugh Chatfield
Hugh Chatfield has 47+ years of experience in the IT domain. A ¼ century of this work was with the former company Nortel, in R&D, Manufacturing and Business Systems in positions ranging from systems engineer to Member of Scientific Staff to senior management. In 1993 he joined Microstar Software's consulting division to work with Standard Markup Languages (SGML and XML). In 2000, he left to become President of his own company - CyberSpace Industries 2000 inc. providing XML training and consulting services. His company is a founding member of the goUBL business ecosystem to promote the use of the Universal Business Language (UBL) in North America. UBL is an OASIS global standard for the global exchange of electronic business documents.

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