A while ago we had the idea of a series of short documents that would show people the technology behind EDI and the benefits EDI could bring to their organisations.
Now in the age of You Tube and podcasts we are launching a series of podcasts about EDI. They are not designed to go in to the intricacies of EDI technology but rather provide a Free introduction to EDI, where it came from, how it is used and the benefits that can be accrued for a business using it.
These podcasts will not turn you in to an EDI expert, rather we hope we will give you an insight in to how EDI can and is being used to bring benefits to a large number of companies world wide.
To hear the first podcast please click here. The Podcasts are FREE and you are not asked for any personal details to listen to them. Alternatively please click on this link for an RSS feed for the podcasts.
Tuesday, January 22, 2008
SaaS adds more value to EDI
With more and more off our customers we are happily finding ways to add value to the normal EDI processing that has been experienced with older, on-site solutions.
Firstly new acronyms are appearing, for example EIPP (Electronic Invoice Presentation and Payment). Sceptics might call this EDI invoices and BACS. I shall explore the differences in a future post.
For a lot of our users, up until about 18 months ago, traditional EDI with a hint of XML for spice, was just fine. But we have started to notice a sea change in the requirements for EDI. Obviously there is the move towards AS2 and other methods of sending and receiving data. We have been using AS2 for our customers for nearly 4 years but in the past 18 months the adoption rate has accelerated markedly. This is a great move, it reduces the costs of EDI and adds value by removing the latency built in to most EDI processes by the nature of the timed connections.
We have also seen a move to increased data requirements. This has proved difficult for some users as it was not always easy, as I am sure you will realise, to modify their ERP system to process the additional data. However they often had the additional data in "Non EDI" data, for example catalogues, or even the incoming documents such as Purchase Orders.
Because of the nature of our SaaS solution, being based around the concept that all data has value whatever the format, plus the fact that the solution is based on a repository we have been able to take these disparate data sources and merge them to create enhanced EDI messages that the recipient requires. This would be a real struggle with traditional on-site systems.
Over the next few months we intend to expand the use of such solutions to both enhance customer data, add functionality to the user experience of the service and to provide translations of product codes, units of measure, delivery points and many other requirements that are becoming the norm for the modern EDI message exchange.
By adding more value to EDI messages we believe that adoption will accelerate through the next 10 years.
Firstly new acronyms are appearing, for example EIPP (Electronic Invoice Presentation and Payment). Sceptics might call this EDI invoices and BACS. I shall explore the differences in a future post.
For a lot of our users, up until about 18 months ago, traditional EDI with a hint of XML for spice, was just fine. But we have started to notice a sea change in the requirements for EDI. Obviously there is the move towards AS2 and other methods of sending and receiving data. We have been using AS2 for our customers for nearly 4 years but in the past 18 months the adoption rate has accelerated markedly. This is a great move, it reduces the costs of EDI and adds value by removing the latency built in to most EDI processes by the nature of the timed connections.
We have also seen a move to increased data requirements. This has proved difficult for some users as it was not always easy, as I am sure you will realise, to modify their ERP system to process the additional data. However they often had the additional data in "Non EDI" data, for example catalogues, or even the incoming documents such as Purchase Orders.
Because of the nature of our SaaS solution, being based around the concept that all data has value whatever the format, plus the fact that the solution is based on a repository we have been able to take these disparate data sources and merge them to create enhanced EDI messages that the recipient requires. This would be a real struggle with traditional on-site systems.
Over the next few months we intend to expand the use of such solutions to both enhance customer data, add functionality to the user experience of the service and to provide translations of product codes, units of measure, delivery points and many other requirements that are becoming the norm for the modern EDI message exchange.
By adding more value to EDI messages we believe that adoption will accelerate through the next 10 years.
Friday, January 11, 2008
EDI as a Supplier: Brownie Points or Valuable Benefits?
A simple sum, taking the numbers of keystrokes saved through integrated EDI and multiplying them by the keystroke cost quickly determines the viability of each electronic trading relationship.
This has proven to be very useful. It makes assessing whether eBusiness is actually saving the company any money as well as showing up any benefits and what those benefits are worth.
All well and good for a giant, but how is a smaller company able to know things are moving in the right direction, if there are simply insufficient resources to measure these things for you?
What are the opportunities for improvements if you are a supplier to a customer requiring EDI?
Here are a few:
Integrated EDI improves the certainty of delivery for your invoices. You can avoid the “Haven’t received the invoice. Send a copy!” conversation when you enquire what the Devil has happened to your money!
It also improves the timing of invoice delivery, which is very helpful as:
(i) closer invoice timing to goods delivery improves the likelihood of trouble free delivery (GRN) approval
(ii) the earlier invoices are produced & delivered the earlier the “payment due date” clock starts ticking
You are doing the invoice input for the customer, which leads to better information quality going into your customer’s ERP and ensures 100% data integrity across the supply chain!
Your integrated EDI will reduce the likelihood of delayed payments because errors are flagged up earlier, on processing the invoice, rather than as a result of chasing non-payment. A faulty invoice sent via EDI is rejected by the system and you can know in seconds. A faulty paper invoice might remain undetected by you until well after the end of your agreed payment terms with the customer!
You may not have the resources for obtaining detailed measurements of the effect of EDI on your business but you can still determine if things are going in the right direction for you. All you need do is watch one or more of some easily ascertained Key Performance Indicators (KPIs)…
- Improved Process Effectiveness – watch to see if the numbers of Day Sales Outstanding are reducing.
- Improved Productivity – is the number of invoices (or detail lines) processed per fiscal period increasing?
- More Automation – is the proportion of transactions that are processed automatically increasing?
- Improved Quality 1 – check that the ratio of credit notes raised to invoices produced is decreasing!
- Improved Quality 2 – is the number of rejected invoices decreasing?
- Improved Quality 3 – is the number of queries raised also decreasing?
- Cost – is the average cost of processing a transaction decreasing?
So, even with limited time and resources available to you, a glance at any one of these can reassure you that you, as well as your customers, can benefit from integrated electronic trading.
Next time we can look at the same subject from the customer's perspective
Wednesday, January 09, 2008
A Simple Guide To Electronic Data Interchange
Over the holiday period I decided to create a "Simple" Guide to EDI for our Web Site. The idea was that, without needing to register or download, people could visit the Web Site and get a "Simple" FREE introduction to EDI, an answer to the question "What is EDI?".
I wanted to highlight to people what EDI is, what standards they can expect to find and how messages are exchanged. Six Web pages later and I have a thought. The concept of exchanging business documents electronically IS Simple.
The detail of it is convoluted, but for a good reason. Most businesses have a unique way of working. Most IT systems have a unique way of working. Certainly each industry has unique features, for example the way Paper is specified in an order is nothing like how a tin of baked beans is specified which is nothing like how a length of steel lintel for a building is specified. If a human is handling orders and invoices then their knowledge is used to "translate" between the buyers instructions and the suppliers computer system. With EDI or EIPP then the software must assume some or all of this intelligence.
The concept of EDI is easy, but as Ken Foster (One of Our Data Mappers) who has sat on many EDI committees and standards bodies says "The devil is in the detail". If people say that EDI is easy, then they are ignoring the detail or spinning a line (probably in sales ;-)). We chose to do this work because we a sad people who enjoy the detail, but it is not the standard IT software role and it is not to everyone's liking. We believe, and our customers believe, that Outsourcing EDI (SaaS) is best for most businesses because it is such a specialist area. Have a look at any "simple" Guide to EDI and if it is telling the truth you will see how complex it can be.
I wanted to highlight to people what EDI is, what standards they can expect to find and how messages are exchanged. Six Web pages later and I have a thought. The concept of exchanging business documents electronically IS Simple.
The detail of it is convoluted, but for a good reason. Most businesses have a unique way of working. Most IT systems have a unique way of working. Certainly each industry has unique features, for example the way Paper is specified in an order is nothing like how a tin of baked beans is specified which is nothing like how a length of steel lintel for a building is specified. If a human is handling orders and invoices then their knowledge is used to "translate" between the buyers instructions and the suppliers computer system. With EDI or EIPP then the software must assume some or all of this intelligence.
The concept of EDI is easy, but as Ken Foster (One of Our Data Mappers) who has sat on many EDI committees and standards bodies says "The devil is in the detail". If people say that EDI is easy, then they are ignoring the detail or spinning a line (probably in sales ;-)). We chose to do this work because we a sad people who enjoy the detail, but it is not the standard IT software role and it is not to everyone's liking. We believe, and our customers believe, that Outsourcing EDI (SaaS) is best for most businesses because it is such a specialist area. Have a look at any "simple" Guide to EDI and if it is telling the truth you will see how complex it can be.
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