Electronic data interchange (EDI) is the communication of business using standardized documentation. The information within EDI moves directly from one application to another (intercompany). EDI standards allow for an EDI document to be precise and structured, which eliminates the need for manually intervention to modify data content. This automated capability enables information to be shared rapidly, providing organizations to be lean and efficient with IT operations.
All EDI transactions are defined by industry standard EDI message structure and standards. It is important to operate the EDI processes with good governance processes for inbound and native data the business owns or inherits. Data management is essential for the EDI processes to be accurately executed.
Benefits of EDI
Many organizations depend on EDI, a global, foundational B2B technology. It has gained mainstream adoption throughout businesses worldwide as the preferred means to exchange documents in the B2B transaction process.
As an automation technology, EDI delivers core business benefits:
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Cost and Time Saving: EDI allows for an organization to automate a process, previously manually executed with paper documents or other proprietary methods.
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Increased Productivity: More business documents, transaction sets are processed and exchanged in less time.
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Error Reduction: EDI’s rigid standardization ensures that data and files are correctly formatted and constructed before it enters business processes or applications.
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Improves Reporting: EDI, being an electronic document, can be integrated with a range of IT systems to compliment data collection, visibility, analytics and reporting.
Challenges with EDI
EDI can be difficult to implement. Reasons:
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EDI processes need to be maintained at the pace with the evolving regulations and standards.
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EDI can be complex. It needs to accommodate the complexities of business needs. For example, each trading partner in a B2B network can present unique requirements. Even though two partners may agree on which EDI document to use, each can have unique formatting requirements that need to be supported.
Making EDI Efficient and Productive
In addition to obvious factors like agreement on document types, secure transmission methods, and requisite hardware and software, an effective EDI implementation must consider the following:
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EDI Translation and Mapping: Openix Solution’s EDI experts take fields and data elements (for example names, addresses, currency amounts, quantities, identifiers, standard code sets) and maps them from the client’s business application formats into standardized documents and vice versa.
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Batch Processing: At Openix Solutions, we support large EDI message batches to enable our clients and their trading partners exchange transactions which can then be grouped from or split into several divisions or areas of a trading partner’s business.
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EDI Infrastructure: Openix Solution is experienced in setting up our client’s IT infrastructure to manage complex workflows for multiple trading partners. For example, build secure endpoints and connections with trading partners, parse messages for different groups and deliver them to the appropriate targeted applications, build custom trading partner-based rules for load and batch processing of EDI files.
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Support Trading partner agreements (TPA). Openix Solutions experts assist our clients to clarifies terms and conditions, establishes standards for business documents and defines communications and business protocols between trading partners.