This post assumes readers are familiar with the general idea and processes of e-Invoicing in Malaysia, and focuses on how a business can best prepare for the inevitable transition.
As with all shifts, friction is inevitable, and the best leaders anticipate and mitigate them.
Here’s how we’ll break this down:
- We’ll (very) quickly recap a typical e-invoice flow
- We’ll list the three main sources of business constraints that can hinder this flow
- We get to the action item checklist!
Let’s begin.
A typical e-invoice flow for a business
We’re sure everyone has seen this photo by now – it’s the flow of how an e-invoice is created, validated, and submitted to LHDN.
From the diagram, a successful e-invoice flow requires three things to happen once a sale has been made:-:
- The supplier or an employee must create an e-Invoice and submit it to LHDN.
- The submission must be done either via MyInvois or third party software that can connect to MyInvois via API.
- The supplier must share the validated e-invoice with the buyer.
This means at the most basic level, three things are needed:
- A business representative to create and share the e-invoice
- A third party software or the MyInvois app
- The buyer’s tax information
Seems simple enough, so let’s explore three sources of organisational constraints that can bottleneck even the simplest of processes.
3 sources of business bottlenecks
Across the board, all business problems can be traced back to a combination of three things: people, processes, and technology.
Just one by itself is an issue, and several in tandem will almost certainly prevent a business from achieving a desired outcome.
Let’s see what these might look like in the context of e-Invoicing.
People (internal)
- Employees resistant to change
- Lack of knowledge on e-Invoicing guidelines
- Unfamiliarity with new software
- Transition period to build new habits
People (external)
- Vendors and suppliers resistant to change
Processes
- Lack of standardisation across business units
- Blind spots in how processes should change to accommodate e-Invoicing
Technology
- Business has too many transactions to use MyInvois effectively
- Current invoicing SaaS cannot integrate with MyInvois API
The e-Invoicing action item checklist
Regardless of what industry you belong to, if you haven’t taken steps to address e-Invoicing implementation, the following 14 step checklist will come in handy:
People (internal)
✅ Conduct general company-wide training on e-invoicing regulations.
✅ Conduct department / job function-specific e-Invoicing training.
✅ Develop easily accessible resources and guidelines for reference.
✅ Designate e-Invoicing champions within departments to act as a source of reference for colleagues.
People (external)
✅ Exchange tax information with vendors.
✅ Explore alternatives to vendors resistant to e-Invoicing implementation.
✅ Enquire what third party software vendors are using.
Processes
✅ Conduct a thorough review of existing processes.
✅ Work with department team members to redesign processes as needed.
✅ Standardise e-invoicing protocols across business units to the extent possible.
Technology
✅ Verify with your SaaS providers that the software can integrate with MyInvois
✅ Ask for an onboarding training session to verify and upskill employees
✅ Explore alternative SaaS options if not compatible with MyInvois
Decision makers
✅ 😌BE PATIENT!
All the best!
By the way, if you have concerns about e-Invoicing specific to healthcare, oil & gas, e-commerce, construction, or telecommunication, you might find answers in our 37 Industry-Specific FAQs On e-Invoicing!.
Let MISHU assist your e-Invoicing transition
Be it people, processes, or technology, get in touch with our team of experts to see how we can assist your business with organisation-wide adoption of e-Invoicing.