Where does EDI stand today, and where do we stand with it - PowerPoint PPT Presentation

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Where does EDI stand today, and where do we stand with it

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Your B2B network needs to be substantially optimized to facilitate critical business processes and maintain a robust relationship with your business partners. When we include the likelihood of maintaining and managing a sophisticated yet comprehensible B2B channel, at its foundation we have Electronic Data Interchange (EDI). – PowerPoint PPT presentation

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Title: Where does EDI stand today, and where do we stand with it


1
Ebook
Where does EDI stand today, and where do we
stand with it
2
Table of content
Overview..........................................
..................................................
.............................................
3 1. Exploring every nook and cranny of
EDI...............................................
................................. 5 What is
EDI?..............................................
..................................................
................................ 6 2. Manual
process vs. EDI process...........................
..................................................
............... 7 Benefits ......................
..................................................
..................................................
............. 9 3. EDI Standards
..................................................
..................................................
.....................11 ANSI X12.................
..................................................
..................................................
...............12 UN/EDIFACT......................
..................................................
..................................................
....12 4. EDI Systems, Protocols, and
Communication Options.............................
.........................14 What are EDI
protocols? .......................................
..................................................
................15 File Transfer Protocol (FTP)
with Virtual Private Network (VPN)................
.......................15 Secure File Transfer
Protocol (SFTP) and FTPS (File Transfer Protocol
Secure)..............16 Applicability Statement
2 (AS2)...........................................
..................................................
.16 EDI system and communication options
..................................................
...........................16 The Direct EDI
approach..........................................
..................................................
.............16 Value Added Network (VANs)
..................................................
..............................................17 5
. Adopting EDI Welcoming change for the
better............................................
....................18 EDI Implementation
options...........................................
..................................................
.....19 The Symtrax Solution Examples and Case
Studies...........................................
...............20 6. Day-to-day EDI
..................................................
..................................................
...................22 Purchase order to sales
order process (Procurement or Sales)
......................................23 Streamlin
ing the shipping and receiving communication
chain ......................................24
Facilitating payments and accounts
activities........................................
.............................26
Conclusion........................................
..................................................
..........................................28 About
Symtrax ........................................
..................................................
...................................30
1
3
About the Author.................................
..................................................
......................................31 Sources
..................................................
..................................................
.....................................32 References
..................................................
..................................................
............................32
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4
Overview
3
5
Technology is increasingly intertwined with more
and more of what we do. Businesses are starting
to realize that the only way to maintain
stability is to keep changing with time. Were
all aware of how easy it is to become irrelevant
these days. Whats worse, any reluctance to
adapt can leave your company unprepared for the
latest market necessities. When we talk about an
organizations willingness to change, we dont
just refer to internal business process
automation and digitization efforts. This is
important because companies actively invest in
technologies like ERPs, BPMs, and CRMs to
automate critical processes such as sales,
logistics, supply chains, inventory, accounts
payable, and account receivable. As a result,
overall functioning can improve at the cost of
B2B communication specifically, those
involving transactions and data exchange with
external vendors working from different
locations. B2B connectivity heavily dictates the
essence of a robust and tangible business model.
This not only makes communication easier but
creates an effective roadmap towards the
facilitation of a multitude of essential
processes. When we talk about B2B networks, one
of the most widely accepted forms of
communication is the exchange of data in an
electronic format over secure and standard
channels. This is more widely known as
Electronic Data Interchange (EDI), and it has
been around for quite some time now.
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1. Exploring every nook and cranny of EDI
5
7
What is EDI? As you may know, EDI is the exchange
of data in a standard electronic format between
businesses which has been traditionally done on
paper. A more textbook definition of EDI is that
it is a Computer-to-computer exchange of
business documents in a standardized format
between the parties involved in a business
transaction. Having originated in the 1970s, EDI
has evolved greatly over the years. Most
importantly, it has managed to not only remain
the most commonly used form of data communication
but also the most reliable. As per todays
industry standards, EDI has kept a strong hold
across retail, banking, manufacturing, and
information technology, among other essential
services sectors. It is still proving to be
efficient and cost effective to this day.
Why? The answer because EDI maintains and
expands upon a truly digital environment
creating unparalleled scenarios for a transparent
trading environment. Both of these are critical
for a profitable business. At its core, EDI
operates like a conversation of information
between trading partners, which helps acquaint
two independently operating networks. Now, one
might ask, why it is that EDI despite being the
most widely accepted mode of data communication
is not the most widely used one? EDI has always
had a standard- specific process which requires
complete compatibility with hundreds of business
partners. Putting EDI in place requires a
cross-platform implementation with complexities
increasing exponentially as the number of
communications platforms increases
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2. Manual process vs. EDI process
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9
Despite the rise in digitization and e-commerce
efforts in the last couple of decades, as of
2013, the Stanford Global Supply Chain Management
Forum stated that over 50 of B2B communication
was still being done via fax, email, and phone.
Smaller organizations lack the resources to
implement complicated communication protocols.
Although data exchanged over fax or email is
technically electronic, it still involves
unnecessary manual intervention, subjecting the
entire process to delays and errors. A typical
sales process done manually works like
this First, the purchase order is generated by a
buyer and either faxed or emailed to the vendor.
Then, the vendor receives the purchase order and
manually updates the information into their
system to generate a sales order. Finally, an
invoice is created and sent to the buyer using
the information as entered into the internal ERP
or billing system.
EDI can be the cornerstone of the B2B
connectivity because of its extensive use in
various sectors across different departments,
connecting disparate business processes to each
other. According to a study by Forrester, EDI
transactions are at more than 20 billion
annually and growing. In 2019, EDI accounted for
78.9 7 trillion of all B2B electronic
sales, as stated in a data analysis report on the
2020 B2B E-commerce Market (1). Since EDI
specifies a pre-defined format standard and its
communication protocols, data can be exchanged
directly through a channel without any manual
dependencies. In comparison, here is a typical
step-by-step EDI process
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Step 1 Creating an EDI document Data is
identified, extracted, and converted into the
required acceptable format depending on which
document needs to be transmitted. Integrated EDI
software offers direct implementation with the
ERP system. From here, specific applications can
be triggered to extract and create EDI
documents, which can be sent to the correct
trading partner. Step 2 Transmitting the EDI
document Transmission occurs through a
pre-established format and channel. Generally,
the EDI software recognizes the recipient and
directs the message or data using its own
systems. The transmission occurs based on the
type of EDI system being used (we will examine
these in detail later on). Step 3 Receiving the
EDI document This data is then delivered to the
recipients EDI system, which interprets and
validates the message. Step 4 Uploading the EDI
document into the internal system EDI software
now converts the data into the format used across
the recipients internal business network. This
data is then uploaded to the recipients internal
system or ERP.
  • Benefits
  • Lower operational and documentation costs All
    unnecessary expenses affiliated with paper or
    personnel such as printing, signing, and
    retrieval are eliminated. Saved administrative
    resources can be reallocated for greater
    efficiency. Reportedly, processing business
    documents manually proves to be 35 more
    expensive than through an EDI solution (2).

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  • Optimized data recalibration and accuracy EDI is
    a standard-specific and data- driven process,
    and it requires that data be systematically
    arranged. Needless to say, this accounts for
    better accuracy with a 40 reduction in errors
    and higher overall data quality (2).
  • Data security and auditability Security is
    paramount, and without it, your data is
    vulnerable to interference. EDI uses extremely
    reliable security layers that are responsible
    for the encryption and decryption of electronic
    data throughout the transmission process.
    Greater security also helps with accountability,
    a key differentiator that influences audit
    compliance.
  • Improved business lifecycles Time is money, and
    EDI facilitates critical business processes
    through automation, thereby reducing process
    turnaround and eliminating delays.
  • Better management and efficiency With improved
    data accuracy and time management comes better
    performance. Critical documents can be reconciled
    faster with available data, streamlining your
    entire organization. Today, 47 of AP
    professionals consider manual data entry their
    biggest contributor to data inefficiency and
    also the biggest challenge (3).
  • Information accessibility and transparency All
    data is electronically transmitted and stored,
    leading to easier and faster access. This also
    contributes to better transparency, along with
    analysis and decision-making.
  • Strategic business enhancement According to a
    study, 73 of activities carried out in a
    typical business process hold little to no value
    (4). All of these activities eat up productivity
    when done manually. Having EDI as an integrated
    part of your organizations infrastructure gives
    a better foundation for future business
    strategies. This also allows you to explore ways
    to better meet customer and market demands.

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3. EDI
Standards
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The entire dynamic of EDI revolves around
standard formats and ground rules that need to
be adhered to. Today, there are many EDI
standards used around the world and across
industries. Despite this variety, they all
strictly govern how EDI communication is
supposed to happen under their authority. The
most common standards are American National
Standards Institute X12 (ANSI X12), used in and
around North America, and Electronic Data
Interchange for Administration, Commerce, and
Transport (UN/EDIFACT), more widely accepted
everywhere else in the world.
  • ANSI X12
  • ANSI X12 is an EDI standard developed back in
    1979 as a cross-industry and/or cross- company
    electronic document exchange platform.
  • Because of its predominance across different
    sectors, X12 stands as an umbrella term
    incorporating various industry-specific
    sub-standards, also known as subsets,
    categorized within this EDI standard.
  • Some examples of ANSI X12 subsets are
  • AIAG (Automotive Industry Action Group) Used
    across the North American automotive industry.
  • VICS (Voluntary Interindustry Commerce Standard)
    Used across North American retail stores,
    merchandise industries, and goods suppliers.
  • HIPAA (Health Insurance Portability and
    Accountability Act) National standard for the
    use of EDI for healthcare transactions and
    healthcare related services in the US.

UN/EDIFACT This standard was developed under the
United Nations and intended for European
businesses to follow. Similar to the X12
standard, EDIFACT also uses industry-specific
subsets to further streamline EDI
capabilities. Some examples include EANCOM An
international communication standard inculcating
the European Article Number (EAN) system, which
uses specific codes to identify products that
need to be referenced or traded. Being intended
for international commerce, this standard makes
trade easier as a buyer can place orders to the
supplier simply by giving the product code and
not having to worry about a companys internal
standards and nomenclature.
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ODETTE (Organization for Data Exchange by Tele
Transmission in Europe) - Standard used by the
automotive industry in Europe. Other global EDI
standards RosettaNET Developed by a group of
leading technology companies who have
implemented a set of non-proprietary XML-based
business standards defining how businesses
involved can do trade. Tradacoms Similar to the
EANCOM standard, this is used explicitly by the
UK retail sector, utilizing specific product
codes for communication and trade.
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4. EDI Systems, Protocols, and Communication
Options
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  • What are EDI protocols?
  • EDI protocols are a set of rules or definitions
    that dictate how two systems communicate with
    each other and share information. The key
    takeaway here is that for systems to directly
    exchange data electronically, they must follow
    the same protocols.
  • There are certain factors that need to be
    considered when deciding on a communication
    protocol for your business processes. Some of the
    key factors are as follows
  • Security Shared information can contain
    sensitive and confidential data, which makes
    preventing unauthorized access a high priority.
    Each protocol follows its own encryption,
    decryption, or general security measures to
    guarantee a protected communication channel.
  • Non-repudiation The protocol being used should
    ensure that the document holds its integrity and
    specifies the senders information upon arriving
    at the recipients end. This also serves as a
    proof of exchange between a sender and receiver.
  • Message Management This factor concerns the
    confirmation and acknowledgment of an EDI
    process. When a document is exchanged with a
    recipient, there needs to be an acknowledgment
    that confirms the sent document was successfully
    received, decrypted and understood.
  • Ease of implementation and use Will the
    protocols changes lead to greater efficiency?
    Its worth considering how costly setup will be,
    as well as what the impact on your performance
    will be.
  • Interoperability Despite having a common
    protocol, the sender and receiver might not be
    able to communicate with each other due to
    different versions or other system- specific
    problems. This calls for the channel to have
    interoperability to avoid conflicts.
  • Lets now look at some of the types of
    communication protocols used for EDI. Here are a
  • few of the most frequently-ones
  • File Transfer Protocol (FTP) with Virtual Private
    Network (VPN)
  • As the name implies, FTP is a simple protocol for
    file transfer. It does not come with a security
    layer to ensure a robust platform for effective
    data exchange. Because of this, VPNs are used
    together with FTP for more secure communication.
  • However, even with the two used together, they do
    not provide for non-repudiation or message
    management, which can prove to be critical for a
    reliable EDI channel. Furthermore, with VPN
    there is another unsurpassable issue that arises
    from interoperability conflicts. Without this,
    FTP and VPN cannot be truly reliable.

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  • Secure File Transfer Protocol (SFTP) and FTPS
    (File Transfer Protocol Secure)
  • Both SFTP and FTPS provide a secure encryption
    process which assures that the data being shared
    is protected during transmission. However,
    similar to the above option, neither of the two
    provide for non-repudiation and message
    management.
  • Applicability Statement 2 (AS2)
  • AS2 was explicitly engineered to fit limitations
    that other transmission protocols fail to
    achieve. This means that apart from a highly
    robust and secure data protocol, it directly
    addresses the issues governing non-repudiation,
    message management, and interoperability.
  • Non-repudiation The sender of the document
    encrypts their digital signature using a private
    key, which can only be decrypted by the public
    key provided to the recipient. Without this
    digital handshake between the two keys, the
    signature cannot be decrypted. This makes AS2 a
    viable solution that solves the problem regarding
    user identity and data integrity.
  • Message management AS2 provides a special
    message known as the Message Disposition
    Notification (MDN), which informs that the data
    encryption, transmission, and decryption was
    successfully completed.
  • Interoperability AS2 is associated with an
    organization that certifies compatibility
    between different vendors.
  • However, an AS2 protocol is not as user-friendly
    as other options. Being more secure and stable,
    it requires expertise in terms of set up and huge
    initial investment as well as commitment. This
    can be a deciding factor on whether or not you
    choose to use it.
  • EDI system and communication options
  • What are EDI systems? Well, the significance of
    an EDI system overshadows other aspects of
    successful EDI integration. This isnt to say
    imply that other factors in the EDI process are
    less important. However, having an appropriate
    EDI system is essential for both successful EDI
    implementation and significant ROI.
  • The Direct EDI approach
  • This direct connection model establishes a
    single, unhindered channel for communication
    between the sender and the receiver (or the buyer
    and the vendor).
  • The direct EDI method becomes resource, time, and
    labor-intensive if the communication protocol
    you use differs from the one your trading
    partners use. For direct EDI integration to be
    self-sufficient, your company must include and
    segregate all protocols in accordance with your
    active trading partners.

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Value Added Network (VANs) The VAN approach, also
known as the Network model, exclusively involves
a third-party service provider who acts as a
bridge between the sender and the receiver. This
service provider is an intermediary who handles
data exchange through the desired or required
transmission channel without forcing the sender
to incorporate various communication protocols
on their own. Therefore, if youre the sender,
you can choose to connect to the Value-Added
Network using your preferred mode for data
transmission without having to worry about the
transmission protocol being used by your trading
partners.
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5.
Adopting EDI
Welcoming change for the better
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Even if your business has been mostly profitable,
and over the years youve managed to uphold a
lucrative business against all odds, the decision
of shifting towards EDI is unfortunately not
always an internally strategized decision to
make. Some operational giants might have specific
compliance requirements and ask you to adopt EDI
as a necessity. Your business could depend on
revenue from said customer. Whats more,
pressure from larger retailers refusing to do
business without a proper EDI solution in place
can force the need for adoption. This is where
small to medium-sized companies face a real
challenge. It can be difficult to know where to
turn to and how to leverage EDI capabilities to
your advantage. The decision to embrace EDI
doesnt have to be made overnight, though.
Instead, a healthy EDI adoption can progress
through phases to full compatibility, profit, and
productivity. These phases can be defined as
follows Phase 1 Reactive This is the starting
phase, when an EDI solution is newly integrated
into your architecture, usually as a result of
market competition or pressure from trading
partners. At this stage, EDI seems like more of a
liability than a valuable company
resource. Phase 2 Proactive Here, EDI starts
becoming the norm, and, eventually, an essential
resource for your business documents, with
capital assigned explicitly to its
expansion. Phase 3 Strategic At this phase,
EDI is now critical, with its infrastructure an
integral part of enterprise-wide functioning.
Your company may see an increase in ROI and a
decrease in time to revenue. As such, you may
start making strategic efforts to build further
on EDI capabilities. Hopefully, this gives you a
sense of what an EDI roadmap might look like. To
get to the end, you need to first traverse
through decision-making, risk analysis, and
implementation. EDI Implementation options As
weve already mentioned, EDI implementation can
be broken down into two primary options the
direct method and the VAN method (third party
service provider). The direct communication
channel is also referred to as an in-house EDI
model. Establishing an EDI this way requires a
large initial investment with uncertain outcome.
Therefore, this is a high-risk decision with
several variables to weigh before you undertake
it. The initial setup cost includes establishing
an infrastructure which stretches through your
network configuration, requiring you to
essentially redesign business processes from the
ground up. Accompanying this will be personnel
costs required for both setting up and
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  • maintaining an EDI channel. This complexity
    increases with the number of trading partners,
    forcing you to scale up your EDI infrastructure
    further.
  • The second option, the VAN, can be a blessing in
    disguise as it incurs relatively lower initial
    costs. This allows you observe the impact of EDI
    in accordance with your working environment.
  • By outsourcing, youre potentially allowing an
    expert in the field to bring well-established
    EDI capabilities into your existing ERP, without
    having to make major system upgrades and
    changes.
  • To get a clearer picture, here are a few concerns
    you eliminate with this method
  • Resource allocation With a VAN, theres no
    hassle when it comes to financials, personnel
    allocation, hectic system modifications, or
    network changes. The EDI provider takes care of
    all necessary resources required for creating a
    communication channel between you and your
    trading partners, with charges only applicable
    for the service provided.
  • Support across multiple channels VANs use
    various communication channel to transmit data
    to one or many recipients. If you have a
    third-party EDI provider, it is their job to
    arbitrate the data between the sender and the
    recipient, in the right format, and using the
    right protocol.
  • End-to-end data processing and automation
    External service providers likely have the
    experience of having worked with various EDI
    platforms with needs similar to yours. So, they
    come equipped with the automation and compliance
    tools necessary for EDI translation, security,
    transmission, and retrieval. This ensures that
    your data is in safe hands at all times.
  • Scalability Your service provider should be able
    to meet all necessary software and
  • hardware requirements. The system can scale up or
    down to fit your business requirements, so any
    changes, including new trading partners with
    unique EDI standards or demands, can be
    accounted for.
  • The Symtrax Solution Examples and Case Studies
  • Symtrax specializes in honing EDI capabilities to
    blend convenience with security. Our software,
    Compleo Hybrid, uses certified connectors and web
    APIs to integrate directly with all ERPs. With
    end-to-end automation, your entire document
    exchange and conversion process is optimized to
    require no manual interference at any point. You
    can manage, analyze, and compare information to
    make effective decisions, thanks to having
    electronic data always available at your
    disposal.
  • One of our customers a leading FMCG industry
    pioneer - had a specific need for a B2B
    solution. They, in turn, had a customer who
    required invoices to be converted into a

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hexadecimal format and uploaded to the customers
repository. Compleo Hybrid was able to meet these
specifications without any downtime or manual
intervention. Symtrax also assisted in another
data interchange implementation to help a leading
healthcare company with document conversion and
transmission. They needed a digital solution
that could convert purchase order (PO) data into
an XML format, transmit that XML through an EDI
protocol for data pushback and then route it into
their internal ERP system for sales order
creation. Compleo Hybrid monitored all incoming
POs in real-time. As soon as a PO was received,
Compleo Hybrids AI-powered engine extracted the
relevant data and converted it into an XML
format. Using an SFTP approach, Compleo Hybrid
successfully allowed for sales order creation by
processing the XML file directly through to their
ERP. To automate a GRN (Goods Received Note)
creation process, we introduced Compleo Hybrid
for another customer. With active real-time
supervision, Compleo Hybrid captures all
incoming delivery notes from vendors. These notes
are then compared with existing purchase orders
to confirm if the order delivered matches the one
requested. Exceptions are filtered out and
reported. After successful validation checks,
Compleo Hybrid extracts the required values are
extracted and creates a GRN. Finally, it pushes
the GRN into the ERP and the concerned personnel
are notified regarding the same. We also helped
another industry leader - the largest soda ash
manufacturer in the world automate their
digital signature and document distribution
processes with enhanced EDI. Symtrax solution
for digital signature automation helped us adapt
to the new compliance requirements and made it
easier to handle printing and distribution of
documents, said Mr. Raviraj Gurav, a senior
manager at the company. The capability of
achieving end to end automation takes us closer
to our goal of becoming a digital organization."
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6. Day-to-day EDI
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The supply chain lies at the core of most
business processes. To be honest, it is also the
most data-dependent or perhaps even
document-driven department to operate globally.
In these challenging times where effective
digitization efforts are key, the supply chain
remains under enormous pressure to increase
efficiency. Most industries involved in
transactions are constantly scrutinizing
techniques to improve and refine this
department. Streamlining your workflow and some
critical backend process can lead to
ground-breaking performance enhancements in your
supply chain. Lets look at some of the greatest
applications of EDI in business departments and
processes. Purchase order to sales order process
(Procurement or Sales) This is perhaps the most
fundamental EDI process. Companies that have a
back-office integrated with their ERPs and
central systems can generate purchase orders
automatically. Now, using an EDI system, the
purchase order (PO) is converted into the
required format and transmitted over a channel
through to the supplier. The document arrives at
the supplier, where it is converted back to the
desired format and uploaded into the system. If
there are certain changes, or if the supplier is
unable to fulfil certain products requested in
the purchase order, an acknowledgment (also known
as a purchase order acknowledgement) is returned
back to the buyer. This acknowledgement will
cite information regarding the said
requirements. In this case, the buyer
re-processes an updated purchase order
incorporating the changes as mentioned in the
acknowledgment. The buyer can also process an
updated purchase order requesting changes in the
order previously placed to the vendor. When the
purchase order is accepted, the supply also
acknowledges it, confirming the validity of
their order. This creates a sales order for the
corresponding purchase order in the suppliers
ERP system. According to a study, when orders are
processed through EDI without manual
intervention, the time from order to shipment is
cut by half. An order that takes up to seven
days to be processed manually now takes only
three days or fewer if done through an EDI
communication channel. Regardless of how they are
processed, almost 40 of the customers orders
reportedly changed at least once after getting
placed (5). Once again, we see that EDI can
reduce data reconciliation errors, enhance order
processing speeds, and reduce fulfilment errors
when compared to other methods.
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Streamlining the shipping and receiving
communication chain Certain documents are
critical for successful deliveries. To optimize
these documents, you need to eliminate possible
warehouse management challenges and shipping link
failures upon time of arrival. Consider a large
manufacturing unit that has a consignment due
from a supplier. Lets say this shipment arrives
unexpectedly. The sheer number of shipped
materials can be overwhelming for the receiver
to comprehend without causing unwanted delays and
holdups. This requires pre-allotted personnel
and warehouse space to accommodate the order
without adding too much time. To solve this
problem, you can use an Advanced Shipping Notice
ASN (ASN). An ASN is basically a document sent
from the supplier to the buyer and consisting of
important shipping details, such as the names of
the items being shipped, due date for arrival,
transportation details, and other related
information. The whole purpose of an ASN is to
inform the recipient of the incoming goods,
allowing them to prepare in advance for the
incoming order and adjust accordingly. Through a
proper EDI communication platform, an ASN also
allows the recipient to keep track of all items
being shipped, including transit details. If the
shipment is delayed, the recipient is informed,
and can prepare for the goods arrival at the new
time. A lack of ASNs can lead to longer wait
times, shipment mismanagement, and lower overall
efficiency. According to a study, 30 of orders
are still received without the issuance of
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ASNs or other necessary documents. The estimated
cost of processing a procurement order without
an ASN or dispatch notice is 78 per order. This
is unimaginably high when compared to the same
process using an EDI, during which the cost is
identified as anywhere between 0.01 0.02 per
order (5). To further enhance shipping accuracy,
deliverables can consist of printed barcodes
containing the encrypted data of all consignment
items. These affixed codes can be scanned upon
arrival and then updated in the Warehouse
Management Systems (WMS). This data is compared
with the ASN received earlier to ensure that the
items indicated in it have been fulfilled
(either partially or completely). As a result,
warehouse management can be optimized, updating
and regulating inventory levels more
efficiently. Data obtained from scanning
delivered goods can then be used to create a GRN
(Goods Received Note) in real time, therefore
automating the GRN creation process.
Subsequently, the system will update the central
ERP and notify concerned officials of the goods
successful entry and delivery. To learn more
about the GRN automation process, read our
blog. Furthermore, the GRN is a deal-breaker when
it comes to initiating and completing payment
activities. In fact, the GRN is more widely
considered an Accounts Payable (AP)- specific
document because of its importance in the
three-way matching process. All of this can be
facilitated with the right EDI solution working
as the pillar for effective supply chain
management.
27
  • Facilitating payments and accounts activities
  • Why is a GRN an important document for payments
    and accounts? Because it proves that the goods
    indicated by the supplier have been a) received
    by the buyer and b) successfully passed
    inspections and validation checks.
  • With EDI, the entire accounting process can be
    systematically automated, leaving no room for
    erroneous payments or mismanagement.
  • To summarize, the process works like this
  • The buyer generates a purchase order which the
    supplier then accepts and acknowledges.
  • After the order is fulfilled, fulfilment of the
    order, the vendor generates an invoice.
  • The buyer receives the invoice.
  • Upon delivery, a GRN is automatically generated
    upon delivery and then matched with the received
    invoice and purchase order(s). This process is
    known as three- way match making.
  • The verification process initiates the payment to
    the supplier for the services received by the
    buyer. This marks the end of the procurement
    process along with the completion of the
    transaction.
  • Some companies that further leverage their EDI
    capabilities initiate a document called a
    remittance advice, which is given to the buyers
    bank to confirm payment clearance. Another
    advice is generated after the payment is
    complete, notifying the supplier about the same.
  • Invoicing in itself is a compliance-driven
    process, with many countries now mandating
    invoice registration on central
    government-monitored platforms. The process of
    exchanging an electronic invoice (or e-invoice)
    is gradually becoming a global standard. This is
    true not just for internal trade, but via
    government-regulated guidelines strictly
    dictating certain compliance protocols.
  • For instance we have the PEPPOL standard across
    Europe, the ChorusPRO platform in France, and
    the e-invoicing regime under GST guidelines in
    India. The e-invoicing mandate is also included
    across Germany and Spain, along with widespread
    acceptance and standards in and around Latin
    America.

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Conclusion
In the end, all of these components can add up to
a platform so robust yet seamless that it
completely eliminates the roadblocks to a
fast-moving B2B network. Connectivity is
everything. When decision-makers realize this
foundational concept, they start to take steps
towards progress. Establishing an EDI-enabled
business model may be difficult and
resource-intensive at first, but the payoff can
lead to an EDI-powered environment that controls
and maximises your business capabilities. As we
have discussed, there are several factors to
consider, each with its own perks and
pitfalls. Developing in-house can be daunting for
businesses with lower document volumes. However,
no two companies will have the same requirements,
or business models, or even needs, so this could
still be the right choice for you. Given how this
era of trade and commerce focuses on
accentuating technology as its driving force, the
decision to move to electronic data interchange
doesnt have to be internally detail oriented.
Choosing to go with an EDI service provider
might allow you to at least begin to understand
the impact of EDI. The more you align your
business with EDI, the more will you be able to
visualize the best next steps your business. We
at Symtrax understand the business concerns
surrounding EDI. As such, we offer a tailored
solution that doesnt just fit but seamlessly
integrates with your current architecture. We
prioritize compliance, and customer relations,
ensuring that your business retains high
productivity despite changing requirements and
needs.
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EDI is and will continue to be relevant worldwide
simply because it is the most widely accepted
mode of business communication. Despite constant
market shifts, EDI manages to maintain a
foothold at the heart of vastly different
businesses, simplifying complex procedures, and
maintaining balance throughout. No matter why
your company is considering EDI, it can prove to
be a gamechanger that can help you meet your B2B
goals more efficiently over time. As such, the
more you plan your strategy, the better your
potential results. .
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About Symtrax
Symtrax is a worldwide software company helping
organizations enhance document management
processes with cloud-ready solutions in mind. Our
ever-expanding range of connectors establishes
compatibility easily, and our Compleo Suite
software can address a wide range of challenges
through its specialized modules. To learn more,
visit our site or contact us at
sales_at_symtrax.com.
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About the Author
Priyanshu Anand Technical Writer Priyanshu is a
keen observer of market dynamics and how they
shift and evolve with todays rapidly expanding
technologies. He is curiously involved in writing
engaging content for the readers to explore and
pursue digital transformation efforts as a
competitive solution for the future.
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Sources
  1. https//www.digitalcommerce360.com/2020/06/01/why-
    edi-still- has-a-big-role-to-play-in-b2b-ecommerc
    e/
  2. https//www.edibasics.com/benefits-of-edi/
  3. https//www.kofax.com/-/media/Files/E-books/EN/eb_
    ten-ways- manual-tasks-are-costing-your-business_
    en.pdf
  4. https//www2.deloitte.com/content/dam/Deloitte/nl/
    Documents/p rocess-and-operations/deloitte-nl-six
    -tenets-of-intelligent-process-
    improvement-english.pdf
  5. https//www.gxs.co.uk/wp-content/uploads/EDI-
    Workhorse_of_the_Value_Chain.pdf

References https//proclick.mediclick.com/emateria
ls/help/procedures/EDI.htm https//www.arcesb.com
/resources/edi/x12.rst DI central Whitepaper
Getting Strategic with EDI The Stages of EDI
Adoption in Mid-Sized business. EDI Basics
Opentext How Successful Business Connect,
Communicate, and Collaborate Around the
World Ecosio B2B Connectivity EDI Benchmark
Report Survey 2019
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