EDI deployment: What are the obstacles and how to overcome them?
Published on 3 December 2020
Sending commercial documents physically, by fax, or even by email is over. Since the late 1990s, these exchanges have been gradually replaced by electronic messages (order or delivery vouchers, invoices, etc.), which allow the automation of processes. To do this, companies are now using EDI, an acronym for Electronic Data Interchange. EDI is the exchange of commercial documents from one computer to another, in a standardized and automated manner. Despite offering many advantages such as speed, reliability and traceability of exchanges, EDI is still not used by all companies. How to explain this situation? What are the obstacles to implementing EDI? Focus on the main obstacles to making EDI the norm in companies, and how to overcome them.
Developing an EDI solution is a substantial process for a company. It is a two-pronged project involving:
- Full-fledged IT project management, with its classic phases of analyzing existing information, choosing a solution, configuring it, then deploying and maintaining it;
- an impact study related to the digitalization of manual processes in the company and its business environment
In fact, the ROI - Return On Investment is faster and more substantial when exchanges between partners are regular and recurring, regarding significant volumes. This is why small organizations rarely benefit.
To reduce these costs, there are many ready-to-use services available on the cloud. Offered by experts like Generix Group with Generix EDI Services, they allow for a quick start-up at a lower cost. Additionally, their use is charged per use, which favors small and medium-sized companies.
Difficult implementation for small and medium-sized enterprises (SMEs)
Beyond the financial investment required, small businesses often lack the expertise to begin an IT project like this. If they can call upon an EDI supplier to handle such considerations, the process undeniably requires time to acutely understand the offers and analyze their needs.
This is a necessary step to find the pricing model that best meets the business needs of the company. Choosing an offer and an EDI supplier requires a preliminary analysis of the commercial transactions to be processed, and thus the volumes of data involved. Without this initial review, the company may face significant additional costs.
Several alternative solutions are offered to SMEs or very small companies that do not wish to invest in a fully automated EDI solution. They have the advantage of being inexpensive to both buy and use. They are mainly offered in SaaS mode, but are also compatible with EDI solutions used by client partners. These solutions include WEB-EDI, SmartPDF and online OCR.
Diversity of technologies and rules of standardization
EDI is even more interesting for a company as its entire ecosystem can use it. When deployed among different players in the same sector, it generally encourages partners and competitors to do the same. Thus, EDI has a strong presence in:
- Mass distribution
- The Agri-food industry
This dynamic therefore most often depends on the main contractors in the sector. If Airbus and Boeing adopt EDI with their suppliers, the entire aviation ecosystem moves in this direction. Indirectly, this impact can extend to nearby sectors with common suppliers, such as the naval or automotive sectors.
For an industrial company at the crossroads of several industries, it is complex to master the different standards and technologies of each sector.
In this case, the ideal scenario is to use EDI services in SaaS mode offered by mature players who have already deployed their solution in several sectors. By sharing processes, it is then possible to reuse at a lower cost connectors and technologies that are already proven and financed.
Implementation and deployment time frame within each entity
Faced with relatively long implementation times, companies sometimes turn to alternatives to EDI to digitize their data exchanges more quickly. This may be a document entry and collection portal, or an OCR solution. Keep in mind that they do not offer the same automation capabilities, so these intermediate solutions will never bring the same quality benefits as EDI.
Again, the best way to bypass delays and implementation difficulties for an EDI system is to retain a service in SaaS mode. Hardware and/or software costs are eliminated, and configuration costs are significantly reduced due to the pooling of technologies between network members.
Synchronous trade dynamics
With the development of internet and e-commerce technologies, integrations between application components increasingly require real-time interactions. It involves knowing, for example, the position of stock, obtaining updated prices, or the status of a completed process.
During its start-up period, EDI relied on asynchronous file-sharing technologies. This still corresponds to the need to exchange certain commercial transactions. Additionally, it is necessary to associate it with API management, usually with REST and JSON technologies.
Be attentive, however, not to oppose EDI and API. Digital data exchange can be based on all forms of syntax or language such as XML or JSON. Data transport can also be carried out by protocols close to web services such as EDIINT AS2, SOAP, or REST.
In summary, it becomes necessary to combine the management of EDI and APIs. Fortunately for businesses, most EDI services offered in the cloud are actually open to most B2B integration technologies including MFT, EDI, API, MOM, etc.
Deploying EDI brings about several obstacles: limited adoption in small businesses, diversity of technologies and standards, and sometimes long deployment times. However, the emergency of technologies such as APIs and blockchains alleviates these challenges, thereby ensuring a bright future for EDI. Want to know more about EDI’s benefits and its development prospects?