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Omniva shaping the real-time economy

It’s hard to miss their bright orange self-service parcel terminals lining our cities’ streets; Omniva—the latest chapter of the Estonian National Postal Service—is now the largest international post and logistics company in the Baltics. However, in an increasingly digital world, postal companies around the world now face a unique challenge to maintain their utility. We sat down with Sander Aasna, Head of Information Logistics at Omniva, and Margus Mägi, Omniva’s Head of Strategic Partnerships, to discuss how the company plans to answer this challenge with innovative solutions.

How has Omniva evolved during its 100 years of existence?

Sander Aasna: We are a 100-year-old government-owned entity; meaning that Estonian postal service is as old as Estonia! We’ve been delivering goods and information since the early days, and have evolved together with the country, with the people, and with the technology. To keep up with the business, the postal service has to develop together with the society.

We have restructured ourselves several times in order to keep up with the innovation. For the first 90 years, we’ve been mainly dealing with postal business. Our business was delivering physical things or physical information from point A to point B. But roughly 10 years ago we saw that the universal postal business was decreasing rapidly, between 15% to 20% per year, and almost no one was sending physical letters for business anymore. All the information started to move towards digital channels, and we were faced with two options:

Either to fight the trends or to take advantage of them

We decided to build four business areas which are: postal business, parcel business, International logistics and info-logistics. The outcome which is that we are the biggest parcel machine network provider in the Baltics.

Additionally, we decided that if all the information was going to digital channels then we could go there as well. After a survey among our customers, we discovered that actually 70% of the business content of the letters where invoices. The next logical step was to build an invoice operator service.

Currently, our e-invoice business is growing 30% every year. It has been historically proven that e-invoice system is driven mainly by the public sector and, of course, big industries like utility, banking and so on. The public sector uses a lot of e-invoices and sees great benefits rising from it. Starting with cost savings, for example, with each invoice you can save around 2,5 euros. Estonian public sector is getting 2 million invoices every year from businesses so it is a lot of money to save.

What is the real-time economy and how does it figure into the picture?

Margus Mägi: The real-time economy is the idea that if information is generated in the digital form, we should not transform it back to the analogue. The real-time economy is an environment where financial and administrative transactions are in standardised digital form, increasingly generated automatically and progressively in real-time.

We can interconnect different parts in a way that information, which is generated more and more in the digital form, could flow through various channels to the receiver’s end in real-time and in digital form. From a central government’s or from a companies’ point of view, it enables you to receive all kind of information in real time. You can start making predictions and estimations about your future business in real time as well.

There are three significant benefits of the real-time economy. Benefits for citizens are lower prices and more convenient services; for businesses, it is cost efficiency and predictive risk management; and for the government, it is a tool to fight bureaucracy and to build seamless e-services and way for better policies.

How to turn the collected data into that? With the permission of companies, we can create reports that the government needs to provide better policies for those companies’ risk assessments and consumers needs.

How does Omniva help companies digitalize invoices?

Margus Mägi: With Omniva you can choose the channel how to send invoices—either on paper, e-mail, or e-invoice—we make sure it is delivered.  If a company receives invoices, we convert them from paper or PDF e-mails to e-Invoices, so that the company can become a modern e-invoicing company from day one of joining us.  Even if the company does not have an ERP solution, they can use our system to create e-invoices from scratch and send them directly to their partners or government.

Next year will be a significant milestone for European e-invoicing. The EU has adopted Directive 2014/55 [2], which means that EU member state governments should start using e-invoicing in public procurement processes; this will have a notable effect on all businesses across Europe.

 

What is the goal of the “Internet of Business” project?

Sander Aasna: The goal is to develop a secure and standardised network based on real-time economy concept, where all business transactions are in digital format, generated largely automatically and completed in real time.  We want to implement the European Public Procurement Online System (PEPPOL) developed in Norway fifteen years ago. Nowadays, companies are not only exchanging invoices but also procurement document, thanks to this network all the procedures can be done fully online.

What other solutions Omniva is working on?

Sander Aasna: Omniva is looking different ways how to integrate e-invoicing with open banking solutions. For example, if needed, we can connect balance sheet and bank account statement with invoicing, it enables additional capabilities for companies like credit scoring, real time cash flow predictions etc. And if we put together payments and e-receipts, we can build more accurate e-wallet solutions for consumers. E-receipt will give you lots of information about your purchase: how much meat have you bought etc.

Margus Mägi:  We have a lot of interesting upcoming projects like AI CFO, cross border e-invoicing, predictive analytics etc. Much of the groundwork has been done and we are working to make it happen in practice with our customers. At the same time we are providing transition period know-how in a form of how to turn paper-based process into digitalized and future-oriented ones to our institutional partners.

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