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Overcoming the challenges of electronic data interchange (EDI) implementation

– By Hiten Shah & Anjana S
In today’s global economy, reducing the time and cost required to satisfy customer requests are keys to differentiating you from your competitors. In our last white paper “EDI: The Legacy Standard Continues to Thrive in Transportation Industry” we discussed EDI and its benefits in Transportation and Logistics Industry. Implementing Electronic Data Interchange (EDI) allows companies to handle business transactions with any trading partner using a standardized electronic format. EDI enables businesses to eliminate cost and inefficiencies from transactional processes.
In spite of evident advantages of the EDI system, it can result in both positive and negative effects for businesses. This white paper discusses challenges of EDI implementation and how to overcome them.

Challenges of EDI implementation

Some of the problems that frequently occur even in stable EDI operations:

Factors for a successful EDI implementation

Future of supply chain

Web services/API based integration

Web services are a platform for application integration, offering a model of plug-and-play, peer-to-peer, cross-platform collaboration.

Why web services?

One of the primary advantages of the Web services architecture is that it allows programming languages written on different platforms to communicate with each other in a standards-based way. Another advantage is that they work with standard Internet protocols – XML, HTTP, and TCP/IP and three core technologies.

Benefits of web services

How API fits into the current logistics landscape?

Supply chains cannot afford to run on EDI technology, and the only way they can keep up is with the help of Application Programming Interface(API) technology.
APIs are the fastest and most seamless way to access data and make informed decisions in the supply chain. Forbes dubbed API as the “digital glue” holding our personal and professional worlds together, by allowing data to be transmitted from one system to another in nanoseconds1.
In fact, Gartner says “about three-quarters of Fortune—companies are using public APIs to grow their business”2. And still, most freight and transportation systems have yet to ride this wave.
API creates an automated supply chain that allows companies to identify risks, avoid issues before they occur. Set up of APIs is a one-time process, resulting in immediate access to an entire network of carriers – the code is structured and straightforward. It requires less than a week of time from start to finish to connect a shipper or 3PL into API network.
See the differences and complementarities between API data integration systems and EDI.
API creates an automated supply chain that allows companies to identify risks, avoid issues before they occur. Set up of APIs is a one-time process, resulting in immediate access to an entire network of carriers – the code is structured and straightforward. It requires less than a week of time from start to finish to connect a shipper or 3PL into API network.
APIEDI
Application and user-orientedPartner-oriented
Technical standards basedIndustry standards based
Mobile device friendlyBusiness application friendly
Faster deploymentMedium length deployment
Ad hoc message formats. Driven mainly by the service implementerStandardized message formats (orders, invoices, shipment notices). Driven mainly by standard bodies
Partner on-boarding has simple workflowPartner on-boarding requires technical and business workflow
Usage conditions are defined unilaterally by the APIsBusiness agreement are often required
Typically used for data and service exposureTypically used for order-to-cash and similar supply chain cycles, as well as multi-chain interoperability
Value is in both partner relationship as well as service monetizationValue is in efficiency in partner relations
Owned by Chief Digital Officer and IT departmentsOwned by supply chain and IT departments
API creates an automated supply chain that allows companies to identify risks, avoid issues before they occur. Set up of APIs is a one-time process, resulting in immediate access to an entire network of carriers – the code is structured and straightforward. It requires less than a week of time from start to finish to connect a shipper or 3PL into API network.