EDI Solution Selection

Posted on: July 18, 2024 | By: Meaghan Andrews | QAD Business Process

New to EDI? Don’t know where to start? Or are you currently processing EDI and need to scale your solution to meet the demands of your business?  Let us help guide you to your next step. In this blog we will cover topics to help you think about your business case, organizational structure, future growth, as well as desired architecture that will best suit your business’s EDI needs.

Why EDI?

Why do EDI? Typically, the reasoning behind doing EDI is to reduce the cost of manual processing, reduce the cost of labor with excessive headcount to manage the increasing demand of your customer and supplier business needs.  As your business continues to grow so does the demand for your resources to keep up with the tedious manual processes.  This can lead to burnout and low employee morale.  Automating these processes allows for the current and future increase in demand as well as freeing up employee resources for systematic improvements and continued efficiencies. In addition to this, new and changing customer business requirements also play a role in the need for EDI.  In some industries such as automotive, EDI is a mandated requirement of the customer to ensure you can meet their demand and continued growth of their business.

Organizational Structure

Once you can quantify the need for EDI with a solid business case you need to ensure you have the organizational structure to support the endeavors.  Depending on the size of your company and whether you have a domestic and/or global presence this could look different for you.

  • A single individual facility might have a smaller enterprise with limited resources where roles and responsibilities might be shared to support the solution. Your IT manager might be your EDI coordinator and your support lead.
  • An enterprise with multiple domestic facilities would likely have a wider strategic EDI view holding more resources allowing to separate out some of the roles and responsibilities as well as allowing for shared solutions across the facilities as some level.
  • A global corporation will have a much larger strategic view of their EDI solution. They will likely have a greater number of resources to divide and support shared solutions across the various facilities across the globe.  This allows some of the smaller facilities to benefit from the efforts of the larger ones and giving them the opportunity for continued future growth much quicker.

The Architecture of an EDI Solution

The architecture of a typical EDI solution is comprised of three pieces ultimately; connectivity, translation and routing, and back-end application integration.

  • Connectivity allows for the B2B communication through a VAN, AS2, SFTP SSH, OFTP, HTTP, external API, etc., and can be managed through 3rd party services or software typically.
  • Translation & Routing is the process of sending/receiving the EDI transactions and pulling them or putting them into the standard EDI formats (ANSI X12, EDIFACT, VDA, ODETTE, etc.) agreed upon by the trading partners.
  • Integration to the ERP, CRM, WMS, TMS systems is the final step in this solution. This can look different based on the application as it could be file integrations (Jason, XML, Flat File, CSV, etc.), pre-written APIs to the application, or adapters provided by 3rd party EDI providers.

Conclusion

In conclusion, the perfect EDI solution is one that suites the needs of the company in its current state but ultimately aligns to the goals of the company’s future growth potential.  To ensure you are capturing what is required in identifying the correct EDI Solution for your organization here are some potential next steps:

  • Identify your organizations EDI needs/wants
  • Determine if your business case supports those needs/wants
  • Determine your ideal organizational structure to help support your ideal EDI solution
  • Determine what your EDI solutions architecture will look like and whether you will manage it on premise, have a 3rd party host is in it entirety, or have a 3rd party host it in partial
  • Identify your software/hardware selection if required
  • Determine if you have the resources or need the resources
  • Identify your budget

 

 

Next Steps

If you are interested in learning more about EDI Solutions, contact us here to find out how we can help you grow your business. You can also email us at info@loganconsulting.com or call (312) 345-8817.