Blog Post
Are you looking for an order processing system with EDI capability without the high costs and complexities of legacy EDI processes? Join the club. Across the board, customers in the B2B space are looking for the same levels of speed and flexibility that consumers have come to expect from B2C businesses like Amazon. EDI is often touted as the best way to achieve this quality of service. The challenge is that if you want to use EDI to better serve your customers, they also have to implement the technology. Few businesses need or want to handle the costs and complexities of an in-house, legacy EDI platform.
There is a better way. Read on to learn more about how to achieve lightning-fast and highly accurate order fulfillment for industrial B2B sales with a solution that enhances your EDI capabilities without your customers changing a thing.
What Is EDI Capability?
EDI capability allows disparate systems to electronically exchange business documents in a standardized format. To become EDI capable, a business’s ordering and fulfillment technology must be able to translate, transmit, and process various business documents from different trading partners, including purchase orders, invoices, and shipping notices. These business documents can come in a variety of standardized formats, including:
- ANSI X12
- EDIFACT
- TRADACOMS
- XML
- ODETTE
- EANCOM
- VDA
The Limitations of Traditional EDI
For many businesses, it’s easy to assume that traditional EDI solutions are the right route for digital order optimization. However, among other drawbacks, legacy EDI implementations can be extremely expensive and prohibitively complex. Here are the most common issues we’ve seen businesses run into:
- High initial implementation costs:
Implementing traditional EDI systems requires significant investments in both software and hardware, making it a costly endeavor. Businesses must also allocate funds for comprehensive staff training to ensure employees can effectively manage and operate the new systems, adding to the overall expenditure. - Technical complexity:
Traditional EDI implementations demand specialized knowledge and expertise, as the setup and maintenance processes are extremely complex. These solutions involve many moving parts, increasing the risk of errors during the initial setup and ongoing maintenance, potentially disrupting business operations. - Compatibility issues:
Different EDI standards, such as ANSI X12 and EDIFACT, can create compatibility challenges, particularly when trading with partners using different standards. Integrating EDI systems with existing legacy systems can also be highly problematic, requiring additional resources and technical adjustments to ensure smooth interoperability. - Dependence on trading partners:
The effectiveness of EDI systems depends heavily on trading partners’ adoption of the technology. If your partners aren’t using EDI, its utility is limited. This is why traditional EDI solutions are primarily targeted to large enterprise organizations with massive customer bases. - Inflexibility:
Legacy EDI systems often lack the flexibility to modify standardized formats easily or accommodate specific business processes. This rigidity is a drawback for businesses with unique requirements or organizations that only need to manage infrequent orders. - Ongoing maintenance and support costs:
Those who eat the costs and strive to overcome the previous challenges listed will still be faced with the need to update and constantly monitor their system. This can be highly resource-intensive, with many organizations employing dedicated IT staff teams just to handle these tasks. This, of course, adds to the ongoing operational costs and increases the long-term expense of running the system.
What Are the Top 7 Benefits of Having an Automated EDI Capability?
Automated EDI takes the limitations of legacy EDI and turns them on their head. From reduced implementation times to increased ease of use, automated EDI platforms bring a number of benefits to the table, including:
- Cost Savings: Automation helps lower labor costs and minimizes errors, reducing overall expenses. By automating never-ending, repetitive tasks like data entry and document processing, your organization gains efficiency and drastically cuts down on errors in order processing. Evaluate your business's current standing across processes, technologies, and customer interactions to reveal opportunities for optimization. With a solid understanding of your starting point, outline the specific technologies, processes, and cultural changes needed to achieve your goals. Ensure you get input from employees across all departments, so your strategy addresses their needs.
- Improved Accuracy: Automated EDI solutions ensure precise data exchange, reducing the risk of costly human error. These solutions use advanced algorithms and artificial intelligence to accurately capture, translate, and transmit data between systems, maintaining data integrity throughout the transaction process.
- Enhanced Visibility: One of the significant advantages of automated EDI solutions is real-time tracking and reporting capabilities. These solutions provide businesses with greater transparency into their supply chain operations by allowing them to monitor the status of transactions as they occur.
- Accelerates Transaction Speed: Automated EDI solutions enable faster processing times by streamlining the exchange of documents and data between trading partners. Unlike traditional manual processes that can take hours or days, automated EDI can complete transactions in minutes.
- Better Compliance: Compliance with industry standards and regulations is critical for businesses engaged in electronic data interchange. Automated EDI solutions adhere to these standards automatically, ensuring that all transactions meet the necessary requirements without the need for manual checks.
- Scalability: Automated EDI solutions are built to scale with business growth and increased transaction volumes. Unlike traditional systems that often require major upgrades or reconfigurations to handle higher transaction loads, automated solutions easily adjust to growing demands.
- Strengthened Relationships: Reliable and timely data exchange helps build better partner relationships. Automated EDI solutions facilitate consistent and accurate communication, ensuring that orders, invoices, and other critical documents are exchanged promptly and correctly.
See the proof for yourself: Discover how Genpak used Conexiom to automate EDI orders and transform their processes.
How EDI Capabilities Are Upgraded With Automation
EDI capabilities are hugely advantageous for many modern businesses, streamlining the exchange of business documents and data between trading partners. While traditional EDI capabilities offer substantial benefits, automated EDI solutions incorporate advanced technologies to further enhance operations, improve accuracy, and reduce costs. Let’s look at how automation upgrades EDI capabilities:
Document Exchange
Automated EDI solutions revolutionize legacy processes by optimizing document exchange. They automate the generation and transmission of various documents such as purchase orders, invoices, advanced shipping notices (ASNs), and vendor order acknowledgments. This automation minimizes manual entry errors, speeds up procurement and billing processes, and enhances supply chain visibility and coordination.
Data Translation
Data translation is a vital aspect of EDI systems, enabling seamless ordering experiences by converting data from various formats (such as XML, PDFs, and emails) into standardized EDI formats like EDIFACT. Automated EDI platforms handle this conversion without manual intervention, speeding up the process and ensuring standards compliance.
Data Validation
Automation significantly enhances EDI data validation, a crucial process that verifies data accuracy, completeness, and compliance before it is exchanged between trading partners. Automated systems perform field verification and enforce business rules, preventing errors before they cause downstream issues. By ensuring that all transactions meet predefined criteria and standards, automation reduces the need for manual verification and mitigates the risk of data inaccuracies.
Integration With Internal Systems
One of the primary challenges with legacy EDI implementation is system integration. Automation addresses this by streamlining integration with internal processes and systems, including ERP (Enterprise Resource Planning) and CRM (Customer Relationship Management) systems. Automated EDI capabilities ensure real-time data exchange, improving operational efficiency and enabling timely updates between EDI transactions and internal systems. This integration enhances your overall business agility.
Error Handling and Exception Management
EDI transaction processes can be impacted by a range of syntax, semantics, and communication errors. These errors can lead to document loss, incorrect order processing, and dissatisfied customers. Automation enhances error handling and exception management within EDI systems. Automated platforms detect errors autonomously in transaction documents, allowing for immediate correction. Errors can also be corrected automatically, reducing the need for manual intervention and ensuring smoother transaction flows.
Partner Management
Automation simplifies partner management by accelerating the onboarding process and maintaining accurate partner profiles. Automated EDI mapping, translation, and implementation features enable easy onboarding of new partners, while profile management features ensure that partner information is always up-to-date. This fosters better collaboration and reduces administrative overhead.
Workflow Automation
Legacy EDI workflows typically involve several repetitive, manual tasks. These include data entry (such as manual document creation), error handling, and format conversion, document transmission (sending EDI document via fax or email). Automation of EDI workflows enhances overall process efficiency by eliminating manual tasks and ensuring timely transaction approvals.
6 Steps To Implementing Automated EDI Capability
Of course, to access these benefits and more, you first need to acquire an automated EDI capability. A smooth and effective implementation requires following a specific series of steps:
- Assess Business Needs
It’s important to approach automated EDI capability in a similar manner to any other digital transformation process. Assessing business needs is a crucial first step because it ensures that the chosen solution aligns perfectly with your specific operational requirements and strategic goals. This ensures that your solution is personalized and helps you avoid overspending, a lack of compliance, and integration issues down the road. - Choose The Right Solution
Once you understand your needs and objectives, you can then move to the next stage: selecting a solution with automated EDI capabilities that are aligned with your requirements. Look for automated document exchange, data translation, and error handling. Also, consider factors like ease of integration, scalability, and vendor support. One example of a solution that incorporates all these features is Conexiom. With Conexiom, you can enhance your efficiency, reduce errors, and support long-term growth. - Integrate With Existing Systems
With your EDI platform chosen, it’s time to integrate it with existing systems. This is essential for maximizing the benefits of automated EDI. Carefully move through the proper processes for connecting your ERP, CRM, and other platforms to provide real-time data exchange and reduce manual intervention. - Test And Validate
Automated EDI systems must be thoroughly tested and validated to ensure accuracy and compliance. Conduct comprehensive tests to verify that data is correctly translated, documents are accurately exchanged, and business rules are enforced. This step helps identify and resolve any issues before the system goes live, ensuring a smooth transition from legacy EDI to an automated solution. - Train Staff
For any new system to be adopted, it’s critical to provide effective staff training. At this stage, provide comprehensive training sessions to familiarize your team with the new processes, tools, and features. Empower your staff to understand the new system both from an internal perspective and from a customer-facing point of view. This will give them the skills they need to operate automated EDI efficiently, troubleshoot issues, and leverage automation to its fullest potential. - Monitor and Optimize
Finally, after implementing your automated EDI solution, be sure to continuously monitor its performance to ensure that it meets your business needs. Track key metrics, identify areas for improvement, and make necessary adjustments to optimize the system. Regular monitoring and optimization will help you maintain high efficiency, adapt to changing requirements, and maximize the return on your investment in automated EDI technology.
How Conexiom Gives You an Automated EDI-like Capability without Requiring EDI
Now is the perfect time for businesses to embrace EDI-style capabilities due to the increasing demand for efficiency, accuracy, and cost savings in data exchange and supply chain operations. However, traditional EDI systems are too resource-intensive and complex to be a realistic option for many businesses.
Conexiom offers a better solution by enabling automated EDI-like capabilities without the need for conventional EDI infrastructure. Choose Conexiom today and unlock a range of features and benefits, including:
- Automatically process orders and invoices from email
- No coding or process change is required for the implementation
- Enable same-day shipping
- Boost On-Time, In-Full rates
- Free up to 50% of your team’s day to focus on higher-value tasks, such as improving customer service
- Reduce costs by eliminating human error and wasted manual labor
To learn more about how automation transforms business processes and electronic data interchange, check out our webinar on How to Use AI-Enhanced Automation to Extend EDI to Emailed Transactions.