E-Invoicing - Brazil Nota Fiscal 2014 – If your car continues leaking oil, would you just continue to add more oil or fix the leak?

May 30, 2014

The answer is easy – you would fix the leak, unfortunately that same attitude is not taken to country compliance updates including Brazil Nota Fiscal.

 oil_leak

When I ask an end user how they are dealing with Nota Fiscal version 3.1 coming December of 2014, I hear: “we are in the process of upgrading the XML schema”. Unfortunately for IT executives managing global SAP budgets year over year, this is the wrong answer and completely avoids the real costs of these projects. It is not the schema that is the challenge – in countries like Brazil – the real cost is the continuous upgrade and maintenance work of a globally centralized ERP system. 

These challenges show themselves from the beginning and end up creating a whole set of custom configurations that affect both local regression testing and global regression testing when new OSS notes come out for new legal requirements.  Yes the notes are downgraded to previous versions of SAP if you are not on the latest ECC Service Packs, but that doesn’t mean that they are easy to implement into your globally customized template.

So by doing this patch work for Brazil (and by the way you are probably doing this in Mexico, Chile and Argentina with their set of mandates) – you are affectively building more expensive maintenance requirements each and every year with the next year being more expensive than the previous – and you will have to continually apply changes each and every year.  Wouldn’t a better approach be to fix the real problem?

If your car was leaking oil, would you fill it up with a new bottle of oil every day to keep it running or would you fix the leak.  You would fix the leak!

Why does the real cost get overlooked? Two reasons:

  1.        Changes in Latin America, especially Brazil, are complicated and affect all of your operations, not just the invoice. So these are not simple projects; they are updates across three systems (your SAP box, your middleware box, and your compliance server) – the result - a company gets forced into fire drill projects because they underestimate the impact of the Brazil ERP enhancements on the global SAP system and the number of people that need to get involved.
  2.        Second, organizations don't have visibility into the reality of the cost of support. – I spoke to a company the other day that stated – we are happy with our solution, but when I asked:
  •          Have you had your operations been shut down this year due to an issue – the answer was for 5 days?  What was the cost to the business when you are unable to ship for 5 days?   I would say that is not working well.
  •          How many people are maintaining the systems from ERP to the gov’t web services – the answer was 7 - five local team members and two global COE team members to manage the middleware and alignment with SAP ERP template – I wouldn’t say that is an effective use of limited staff – what if you could focus those 7 resources on innovation globally rather than just one countries maintenance?

Few companies look at the real costs – so my recommendation is before you upgrade look at the real cost of what you spent not only for NFe 2.0 but also what you are paid over the last 3 years to operate. And ask yourself, is the money I am spending today to fix the problem – fixing the leak or just adding another bottle of oil to get by for another short period of time. Because just as the oil will leak out of the engine, you are guaranteed that Brazil will change again in 2015.  

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How many months and what is your cost to upgrade to Nota Fiscal 3.1?

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