EDI implementation

EDI implementation initiative and means of successful integration

EDI implementation initiative is one of the major points to consider if you are going to facilitate your business operations, reduce costs and establish partnership with the biggest companies in retail, healthcare and other branches. EDI implementation initiative sometimes is treated as means of speeding up the exchange of business data and automating business practices. Actually, EDI implementation goes far beyond and can be integrated across your company and your partners’ network.

If you choose a step-by-step EDI implementation approach, you can easily reach and deliver an effective EDI solution. Below we show an approximate scenario of EDI implementation with needed steps.

  1. EDI environment structure. No matter how far are you going to with EDI, you should choose responsible staff – EDI coordinator, steering committee and dedicated EDI team. The role of EDI coordinator should be given to an experienced person dealing with electronic data interchange for some years. This person can be chosen from the staff or hired externally. EDI coordinator should contact with all processes participants and coordinate their activities and communication. Steering committee must be headed by EDI coordinator and can consist of head of departments involved in EDI process. The actual role of EDI implementation is given to a dedicated team.
  1. General review and analysis. This stage estimates the list of applications and processes that should be conversed to EDI. The following factors must be taken into account:
  • annual company turnover
  • quantity of trading partners
  • company transactions volume and type
  • manual operations that are likely to be substituted by electronic ones
  • size of inventory.

Each area of the company should be studied in order to understand how EDI implementation strategy can improve it.

  1. Cost and payback analysis. In order to understand how much will EDI implementation initiative cost for your company, you should consider the following points:
  • which company department needs electronic processing first of all
  • how much will EDI cost for definite departments
  • which company department will result in the highest benefit rate
  • how much will EDI cost for the whole company
  • when your company can totally benefit from EDI implementation initiative.

The first point to consider is to make an overview of the existing EDI third-party solutions. Also you should take into account that the solution you are going to apply must cover both your demands and requirements of your potential partners and EDI standards. Have a look at tips below and take them into account when making a cost analysis:

  • scope of project
  • description of existing processing system
  • timing and schedule of project release
  • personnel involved in the process
  • possible alternatives.
  1. Selecting optimal EDI solution. In order to choose the correct EDI solution you should carefully study business issues as well as technical ones. As a result, you will get a clear understanding which solution is the most applicable. Mention the following points:
  • expected EDI documents volume
  • the needed personnel and infrastructure to support EDI
  • trading partners’ network
  • software and hardware.

There are two issues you must choose on this stage – EDI translator package and EDI communications model.

EDI Translator is a package that is sold by a software company or VAN provider. Its role is to receive EDI data and transform into a human-readable form that is suitable for the receiver. Besides, translator can have extra functions such as envelopes handling, documents managing, checking compliance etc.

EDI Communication model serves for connection with your trading partners. Today there exist some methods for exchanging EDI documents, like FTP, EDI-NET, VAN, and also many outsourcing companies who deal with EDI communication.

  1. Choosing network provider. When you select the best network provider you should, first of all, focus on your business needs. Provider’s role may include basic value-added service, training and teaching your staff, integrating with your new trading partners etc. Exploring your basic and extra needs will help you to choose the right network provider. Pay attention to the following points:
  • Do your trading partners use the service of the definite provider?
  • Is the provider strong in your business sector?
  • Does the provider offer only local or global service?
  • What is the role of the provider in EDI standardization?
  • Experience and years of presence in the market.

The next five steps of EDI implementation will be described in the next post.

More about succesfull EDI strategies

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