3 EDI Trends in B2B Digitization Today
Published on 13 June 2023
As the world emerges from the aftermath of the pandemic that rippled shock waves through every supply chain, businesses have been intent on gaining greater visibility and control of their networks. Digitization and automation of business processes are at the heart of this effort. EDI technology is a key component of these digital transformation initiatives.
Here is a look at EDI trends that are shaping the future of commerce today:
Trend 1: Growth of accepted EDI standards and compliance
Many EDI standards and frameworks are in use across continents and industries, such as ANSI X.12, UN-EFIFACT and UBL XML. As the volumes of digital transactions keep growing, especially on digital platforms or exchanges, many recognized data-to-data EDI standards are being adopted in other regions and data models are starting to consolidate. For example, the Peppol EDI protocol used by governments and suppliers in procure-to-pay (P2P) processes and is no longer limited to Asia Pacific countries.
In part, the consolidation and greater adoption of recognized EDI standards is driven by governments worldwide which are pushing for the digitization of e-invoicing involving P2P and order-to-cash (O2C) cycles. These transactions may involve a government and their contractors, or be required by the country for B2B transactions between businesses and its customers and vendors.
EU countries, on a country by country basis, are beginning to implement e-invoice mandates. These frameworks employ either an invoice clearance model which provides the tax authority with visibility into transactions early on—before an invoice is issued to the recipient—or later, in post-audit models where the organization reports transactions with a certain time period after an invoice is sent to the customer.
Such mandates are often years in the making and support tax compliance. Businesses that fail to comply with their country’s e-invoicing requirements can face audits and financial penalties, among other consequences. While e-invoicing requirements are large undertakings for businesses, in the long term, these digital transformation drives only make a business more efficient and competitive.
Trend 2: Integrated B2B EDI platforms
Many companies are moving away from EDI legacy systems such as their own proprietary EDI translator software or use of value-added networks because of costly maintenance and labor. These systems require significant IT resources and often full-time EDI specialists—in short supply—to monitor and manage EDI processes, and don’t provide the level of visibility and control required today.
Rather, B2B EDI integration platforms that integrate with a company’s core systems are a preferred solution for EDI exchanges with capability to orchestrate external transactions between trading partners, creating a B2B ecosystem. These B2B EDI platforms bypass the need for costly and extensive custom integrations from ERP software providers or other B2B core solution providers.
B2B integration platforms ultimately delivery greater visibility, rendering managers with greater control of the supply chain. Use of dashboards and event notifications mean that users can fix data errors quickly and more proactively manage potential disruptions when events occur, such as an incomplete order or a delayed delivery. As a result, multi-enterprise collaboration is possible.
Trend 3: APIs and EDI go together
Use of APIs (application programming interfaces) are another central part of the fabric of digital transformation, adding greater speed and flexibility to B2B and B2C transactions. APIs are everywhere: think enterprise systems from ERP and e-commerce platforms to point solutions like CRM and data analytics solutions.
APIs directly connect to applications, instead of using a file transfer server, facilitating the real-time exchange of data (rather than asynchronous batch transfers). The result? Faster, easier connections with trading partner systems and SaaS applications. With the right integration partner, EDI and APIs can work together seamlessly.
APIs can be a substitute for EDI or a complement to systems that use EDI. For example, even small manufacturers and brands that don’t have the resources for robust EDI infrastructure can use low-cost Web EDI to sell to retailers or set up their own e-commerce stores through APIs.
Research by Deloitte found that API‑led infrastructure is more difficult to maintain and scale than traditional EDI B2B processes. The good news is that by adding API capabilities to an existing EDI integration already in place, enterprises don’t have to invest in an API-led infrastructure.
But companies pursuing EDI need to ensure they have a nimble B2B EDI provider with API integration capabilities that can support the variety of API message formats and integration methods. In addition to API capabilities, when making new investments in a B2B EDI integration platform, companies should select a provider with the flexibility to incorporate other advanced technologies such as AI, IoT and blockchain into the solution.
The EDI solutions leading the charge today are those that incorporate newer technologies such as APIs and AI, and combine functions such as workflow tools and analytics with at-a-glance dashboard views into supply chains. All of these features support the building blocks of revenue, growth and competitive differentiation that create world-class enterprises.
Generix EDI Services include EDI SaaS solutions and the Generix B2B EDI integration platform. For more on our EDI SaaS services, powered by the Generix TradeXpress Infinity B2B integration platform, download our e-book. Generix EDI solutions are used by many leading companies in more than 40 countries worldwide.
About Generix Group
At Generix Group North America, we provide a series of solutions within our Supply Chain Hub product suite to create efficiencies across your entire supply chain. Our solutions are in use around the world and our experience is second-to-none.
We invite you to contact us to learn more.
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