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Blockchain in the Supply Chain: Starting Blocks for Success

Posted by Shandra Locken on Fri, Apr 13, 2018 @ 08:30 AM

Photo appears courtesy of Scott RobinsonThis week's blog was written by Aurora EDI Alliance partner, Karen Blood of GraceBlood LLC. You’ve seen the increasing drumbeat of sensational headlines about supply chain blockchain, for example:

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Yes, there’s plenty of excitement and cheering. And phrases like “game-changing” and “massive disruption.”  Reality check - beyond  the technology providers who will make buckets of money and besides the extraordinary effort being put forth in transportation and logistics by Maersk to grow their business, there truly are major and influential supply chain companies like AmerisourceBergen, Unilever and Walmart who have pilot projects well underway, as described in Walmart and 9 Food Giants Team Up on IBM Blockchain Plans.  Walmart has already filed a blockchain use-case patent application, according to this Digital Journal article.  Note that much of the supply chain effort to date has focused on package, pharmaceutical, and food with tracking and provenance pilot projects.

Blockchain technology is nascent and has many challenges to resolve before widespread adoption. While such certainly will not occur in 2018 for supply chain projects, it will happen more rapidly than one can now imagine. Furthermore, this writer believes the technology will be adopted and advanced for supply chain projects far more rapidly than for public financial transactions. See  Fundamental challenges with public blockchains for more on the latter and note how many of the challenges would be minimal for private blockchains.

So, what should the forward-thinking supply chain company be doing now to be better prepared to win the race? What about our current investments in technologies like EDI? How can we continue to best address these common inefficiencies in the supply chain while we’re still at the starting line?

  • lack of transparency due to inconsistent or unavailable data
  • high proportion of manual work
  • lack of interoperability between systems

While lack of transparency within a given company can be addressed by today’s properly used IT systems, the B2B architectures to support emerging supply chain visibility requirements are still evolving. This piece from Todd Margo of IBM, From EDI to Blockchain, does a good job of illustrating the unique transparency nature of the blockchain as compared with EDI and other point-to-point B2B. He says, “Events representing the exchange of B2B documents, for example, could be recorded on a blockchain, and made visible to all participants in a particular supply chain process…The actual exchange of B2B documents that occurs today can continue to operate as is, and a blockchain could simply provide a shared visibility. “

The Starting Blocks...

More than ever, the unchanging company is at risk for being left at the starting line or not being around for the finish. There’s plenty we can and must continue doing – here are our starting blocks:

  • We must document our visibility requirements for sourcing, fulfilling/manufacturing, transportation, and sales for all three kinds of business information – transactional, planning and unstructured.
  • If our worthy goal is to have the right business information in the right hands in the chain at the right time and to have the information flow as hands-free as possible, then we must understand exactly what we are doing today. Gap analysis of today’s processes as compared with our goal will clarify our work plan.
  • Armed with this documentation and understanding, we’re in excellent position to build out our digital supply chain by investing wisely in digital tools to obtain, use and deliver useful real-time data. This means real-time inventory and sales channel results, warehouse management, shipping system integration. It means moving as much transaction activity as possible from manual/email/fax/snail mail to EDI, EFT and APIs/web services. Check out the excellent “Four Steps to a Digital Supply Chain” section in this article from Supplychaing247.com by Bain & Company partners Sam Israelit, Peter Hanbury, Rodrigo Mayo & Thomas Kwasniok.

Along the path to digitization we will resolve many stakeholder integration and interoperability challenges such as data harmonization for items, including identification, units of measure and pricing; location management for warehouse slots, known delivery points, and drop ships; authorities and permission models for data access; meeting compliance requirements; and trading under the latest security initiatives.

Further, to hear the starting gun, you must stay informed about industry and consortium efforts built on blockchain technology. Remember, it took less than 15 years for the internet to disrupt the supply chain, it will take even less for the blockchain.

For basic blockchain information, this IBM article Blockchain basics: Intoduction to distributed ledgers is a great resource.

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Tags: supply chain, EDI, blockchain, logistics

Prioritizing EDI Tasks

Posted by Shandra Locken on Fri, Mar 23, 2018 @ 05:10 PM

532076662_55fac597b9_z.jpgPhoto appears courtesy of R/DV/RS.  This blog was written by Kristen Kearns, Aurora's EDI Manager.  Ping! You hear your email and there’s another one of those “New Requirements” emails from one of your trading partners, Perfection Construction.  Yeah, yeah, I’ll look at it later.  You never get to it because you have Evan in Sales breathing down your neck about getting ABC Company up and running for EDI ASAP so they can place orders.  Wait a minute!  Did Evan put you in contact with ABC Company’s EDI department to get the specs?  Do we even know if we can do all of their documents and if we can meet their requirements?  Here comes Mary Jane from Accounts Receivable– what does she want?  She needs you to research Best Hardware as they are not paying their invoices.  Let me work on that now before the CFO starts yelling about lack of payments.

A month later, you get another email from Perfection Construction – oops, you never reviewed those new requirements and those revisions go live tomorrow!  Again, you stay late in the office missing your son’s baseball game because you have all these mapping changes to get in place and test in case you get orders tomorrow or have shipments.

What’s an EDI Analyst to do?  A couple of months ago, we had a blog on knowing your customer’s EDI guidelines (requirements) so now let’s talk about prioritizing workload and how those EDI requirements fit into that.

Maybe you’re the IT Director overseeing 5-10 people, maybe it’s just you and another person in the IT department, or maybe you’re on your own!  Regardless of your responsibility level, you first need to make a list of what needs to get done and delegate what you can.

To help you manage your EDI workload, here are five steps to prioritizing your tasks:

Make a list of all your EDI tasks:

  • Leave time for the unexpected issues.  This is probably the number one thing in EDI.  I cannot tell you how many times I think I’m going to work on a particular task, only to be blindsided by three emergencies.
  • Daily checking for errors, logs, etc. – do not forget this as a task.  Sometimes this might take ten minutes a day, sometimes two hours. Keep track of how long it takes you and give yourself an average a day allotment.
  • List all the open tasks that are current and put them in order of their due dates.

Identify Critical vs. Important vs. “when you can”:

  • Critical tasks might be chargeback issues, data failures, mapping modifications that prevent trading partners from receiving your documents correctly.
  • Important tasks might be EDI testing to be completed in the next month
  • When you can” tasks are things that need to be done, but do not fall into the other two categories.

Assess value

  • Following the above Critical tasks, getting chargebacks from a trading partner is negative revenue so it is in your best interest to take care of this immediately.
  • If you implement the trading partner for EDI, will it minimize keying orders into your ERP potentially with mistakes from human entry?  Do you have to email, fax or snail mail invoices?  That takes time and money.  Do you have to key online shipment information into a Web-portal?  If it’s lots of manual work with many orders, maybe this trading partner would be good to get on EDI ASAP.
  • If you do not get this trading partner up and running with EDI soon, could you lose their business to a competitor?

Order tasks by estimated effort.

  • Sometimes it is better to just get a quick task done right away.  Is it just a 5-minute mapping change?  It gets something off your list.  It’s good for your morale to have one less “thing” to do.  At least I feel that way.
  • Do you need to rewrite a big process of your ERP to fit in the needs of this trading partner?  Should you wait?  Or should you do it now because it potentially could be an issue for many more trading partners?

Know when to postpone or delegate to someone:

  • Does Emma from Customer Service keep asking you to check on the raw EDI data about a carrier code?  Why not give her the tools to do the job herself?  For example, in Liaison’s ECS software, you can set up a user to have read-only access. You could train her to go to Data Administrator and find the purchase order herself and look up the carrier code.
  • You do all the mapping, but can you train another person in the IT department?  Not only will you have another resource, you’ll also have a backup for emergencies, sick kids or vacations.  Do you really want to sign into the server when you’re supposed to be enjoying your vacation? 
  • Is this trading partner really important to get up and running?  Have sales do a review of their business with your company.  Do they do hundreds of orders a month or is it just a few a year?  Does the volume justify getting this done right now or can you postpone?  I had a client tell me a salesperson wanted this trading partner up on EDI ASAP. Come to find out in two years, they only had placed four orders worth $1,000.
  • Do you have an ERP upgrade coming up?  A server move?  Maybe all EDI changes and/or developments needs to be suspended until those situations are completed.
  • Lastly, have you reached out the trading partner to ask if you can have an extension?  I’ve found that most trading partners are willing to give you some more time.  They are usually understanding of time constraints.

Hopefully these suggestions will help you prioritize your EDI tasks.  The idea here is to work smarter rather than harder!  Of course, all these tasks can be handled by a good EDI service provider in a managed services scenario.  (wink wink)  Now get to your son’s baseball game…this might be the time he hits a home run. 

Click below to see how Wayfair leveraged the power of Delta/ECS and moved their EDI operations into the 21st century.

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Tags: EDI onboarding, EDI document, electronic data interchange, Liaison Delta/ECS, EDI Consultant, EDI Documentation, Managed Services, business processes

IOT & EDI

Posted by Faith Lamprey on Mon, Feb 26, 2018 @ 07:21 PM

17404793095_8688655ddd_z.jpgPhoto appears courtesy of ITU Pictures.  Recently I was reading a white paper about how Advanced Vehicle Technology is changing the Transportation Industry.  They were talking about "connected trucks" equipped with IOT (Internet of Things) devices (devices with sensors that can communicate with other devices) that can monitor things like temperature, location and speed and produce data that can be used to drive predictive analytics for companies.  I started thinking about how we can leverage the EDI software we use (Liaison's Delta/ECS) to get this data from carriers to the senders and receivers of the goods.

One area the article discussed was using IOT devices to monitor the storage temperature of food while it is being transported to provide clear cold chain tracking and accountability.  This would give proof of clear custody and control of the product if questions surround the quality of it.  Some of this data is required on ASNs in the food industry so having a carrier be able to transmit it and being able to drop it in an ASN document would add to the completeness and accuracy of the data required for food transportation.

The IOT devices can also provide data to know where a delivery is in real time so companies can schedule staff to receive and distribute the delivery when it arrives.  This would provide better visibility of the status of goods ordered and makes the carrier an integral part in the value chain.

The carrier has always been a weak spot in the EDI process, as EDI documents typically go from the vendor to the customer with no input from the carrier other than a PRO number (carrier generated tracking number).  Utilizing the Web Services functionality within Delta/ECS, IOT-enabled delivery data can be updated in real time in a secure manner to give companies greater visibility to when the goods will arrive.

This does not have to apply just to trucks.  All forms of transportation (planes, trains, ships) can use IOT to communicate shipment data.  With the frequency of extreme weather patterns across the country, real-time updating of expected delivery information would be very beneficial to keep the supply chain functioning more effectively.

Integrating the data "connected" carriers can provide into the supply chain enhances the entire process and provides for more efficiency and greater visibility for both the senders and receivers of goods.  The 856 EDI ASN (Advanced Shipment Notice) document provides receivers with what is being delivered and how it is packaged.  Being able to add a "when" dimension to that document is a logical next step given the technology available today.

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Tags: integration software, EDI software, data integration, Liaison Delta/ECS, IOT

How Liaison’s Delta/ECS Solves Integration Challenges

Posted by Shandra Locken on Fri, Feb 09, 2018 @ 03:43 PM

30152022395_ce0f1ae72c_z.jpgPhoto appears courtesy of Lensman.Official.  This blog was written by Kevin Klimek, Support Technician for Aurora Technologies.  We all know that integrating your EDI is the holy grail of being EDI capable.  But why doesn’t everyone take advantage of integration?  We can talk about expense or lack of staff or any number of issues but the integration itself what I want to focus on here. Integration is not always a simple concept.  There are different integration challenges that face vendors and retailers when implementing a seamless EDI system. What are some of these challenges?

First and foremost, how do you move information in and out of disparate applications? For example, transferring data from the retailer into your (vendor’s) very different application, or moving data from your application to the retailer. There are a couple of different ways you can accomplish this. The first method is to use a database which you can then import and export the data needed. Another method includes the use of files with specific formats that the applications can read.

The second challenge to integration is converting the data sent/received into something usable/readable by the applications, not to mention a human who may need to review the data being sent/received. If an individual does not have any EDI experience when looking at a raw EDI document, it would appear to them as computer gibberish.  Trying to learn what all the segments and elements of an EDI document translate to in a meaningful way can take up a valuable resource known as time.

Another integration challenge is the transmission of your data securely to its destination. This can be between Trading Partners, between users within the organization, or from one Value Added Network (VAN) mailbox to another.  There are different protocols that can be used in order to transmit this data such as SFTP, FTPS, AS2, SMTP and POP3 to name a few. Lastly, how do you address exception handling and/or other unanticipated issues? When an issue arises with the data being sent in and out of the applications, or when an error occurs in the communication protocols, it disrupts the flow of business operations and can ultimately affect your bottom line.

How does Liaison’s Delta/ECS solve some of these challenges? So happy you asked.  The challenge of moving data in and out of applications is met nicely with Liaison’s Delta mapper, providing a user with the flexibility of writing EDI documents to any number of file formats such as text files, CSV files, or XML files to name a few. Delta is truly an any-to-any translation tool.  With the powerful flexibility of the mapper, the EDI data can be mapped into a user friendly format which makes it easy for the user to understand and read.  Liaison Delta can also read/write data directly to/from a database.

The third challenge is secure communications and this is where Liaison ECS comes into play. Liaison ECS, acting as the airport control tower, deals in a wide variety of communication protocols depending on the business requirements of an organization, and the requirements of the Trading Partner. Liaison ECS can handle all of the established protocols, including the newish SHA2 encryption now being required by several retailers.  See this blog for more on that.

ECS also does an incredible job with exception handling.  Not only does ECS provide secure communications methods, it also allows for error reporting if an issue should arise, notifying you before it becomes a major headache. These are done through setting up event rules within ECS to capture different errors. When an error/issue is encountered, ECS can send out error alerts to individuals notifying them of the issue.

The flexibility of Liaison Delta/ECS makes for solving integration challenges a breeze!

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Tags: EDI integration, integration software, data integration, Liaison Delta/ECS, EDI, EDI solution

Do You Know Your Customer's EDI Guidelines?

Posted by Shandra Locken on Fri, Jan 26, 2018 @ 06:02 PM

4341277184_c7b37f5074_z.jpgPhoto appears courtesy of Brianna Lehman. This week's blog was written by Kim Zajehowski, Aurora's Manager of EDI Hosting. As a person who has worked in the EDI area for many years, I have learned that it is not an easy task to stay current and on top of all of your customer requirements at all times. Not only are your customers always enhancing their internal processes, but your organization may be doing the same. This has a direct effect on EDI trading partners and how they communicate EDI transactions, ticketing ramifications, and shipping requirements. There are also customer GS1-128/UCC-128/Carton Label requirements to follow, down to the size of the font used for the printed information, the format of where to put certain information, and bar coding specifications. If you don’t keep up with these changes, you will see a great number of compliance chargebacks. This can get quite expensive really fast and can end up with you having to pay for the orders placed to your company due to the issues. No net gain there.

As an EDI coordinator, you should aim for reaching out to your trading partner community each month to review their specifications and note any changes. We found that this really could become a full time job just to review everyone’s requirements and let alone handle the everyday issues that might crop up. Depending on the number of trading partners you do business with, it can get overwhelming and compounded by the fact that you know that if one trading partner has an approaching deadline there may be others with deadlines in the same timeframe or pretty close to it. I have also seen this type of monitoring be delegated to the customer service representatives that handle each customer account. Regardless of whose responsibility it is, it’s better to be proactive than reactive to changes.

There are a couple of suggestions to help in this process. One suggestion is to ensure all of your trading partners have current company contact information to reach you in the event of changes as they may generate mass emails notifying their trading partners of changes in the future.  We have seen many clients have a dedicated email address for all things EDI so that is one way to keep all communications in one place.  You may also see that your customers/vendors employ third parties to handle all of their testing and label compliance to offload the massive volume of onboarding to minimize the issues as trading partners work to become compliant. These third parties may handle the mass emails as well. One thing to note is that you may be required to pay testing fees and label review fees prior to implementing your customer’s compliance changes.  This is becoming more and more common.

Another suggestion is to do your research as there are EDI companies out there that will do the monitoring of retailers’ requirements and will give you a heads up of any changes as well. There will probably be subscription fees for this service but this may be well worth it if you don’t have the staff to handle it.  So it is very important to always know your customer’s EDI Guidelines and shipping requirements as it can end up saving your organization money and increasing your bottom line.

Stay tuned in the coming weeks as we will have a follow-up blog on prioritizing tasks to keep up with your customer’s guidelines.

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Tags: EDI Technology, EDI considerations, benefits of EDI, EDI basics, EDI compliant, EDI

EDI Everywhere, Every Day, Who Knew...?

Posted by Roger Curtis on Mon, Jan 08, 2018 @ 07:59 PM

bigstock-Last-Puzzle-Piece-With-Busines-93388364.jpgAs I sit at my desk for the last time this year ending a very busy year I think back to the late 1980s when I first got into EDI. I had gotten a taste of programming in communications, connecting computers to Telex machines, and companies were clamoring for technicians who could figure out Bisync modems.  Walmart was requiring all suppliers to use them to receive orders and send invoices by EDI into the Walmart mainframes.

I guess that’s what really got things rolling for EDI which is still going strong today, thirty years later. Who knew?  I was able to figure out the ‘3780’ coding used to get those modems to sing and saw my first EDI 850 PO with fields of data and asterisks of field delimiters.  Outside of expanding in every which way to more documents and industries, it’s exciting to see just how interconnected EDI is today with every industry, all over the world.

We’re fortunate to have a well-known credit card reader company as a customer mapping EDI from their retail customers into their ERP system.  Right now I’m integrating their systems with who else but Amazon (hey, aren’t they into web-services also?), doing the mapping and online document certification processes. It can be tedious ensuring everything is correct, and getting the 3PL (Third Party Logistics) company’s sample to speak to Amazon, so I take a break and walk down to the Blue Bottle coffee shop a block away to get an afternoon latte.  Note to self – are they doing EDI?

That’s when the barista swipes my card and I realize it’s on my customer’s machine, processing my transaction. Can’t get away for a moment, some break.  ;)

In our online, interconnected world, EDI has really taken a place at the table of our daily lives.

Happy new year to all…here's to a prosperous 2018!

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Tags: amazon, Walmart, Integration, EDI solution

Happy Holidays from the Aurora EDI Alliance

Posted by Shandra Locken on Fri, Dec 22, 2017 @ 08:30 AM

11535301765_611e66934d_z.jpgPhoto appears courtesy of Nikos Koutoulas.  And now we revisit a blog we did a few years ago for some holiday fun!  This is our take on'Twas the Night Before Christmas...with sincere apologies to the original author, Clement Clarke Moore.

'Twas the night before Christmas and all through the store not a PO was issued, and 860s no more.  

RFID tags hung by receiving dock with care, in hopes that the trucks soon would be there.

The clerks were all nestled at registers and stations, while visions of UPC codes danced across nations.

With the EDI manager and I in our caps, we had just settled down for 852 recaps.

When inside the server room there arose such a clatter, we ran from the cubicle to see what was the matter.

And away to that freezing room I flew like a flash, right through the door and PVC curtains in a dash.

The CFL bulb on the copy paper supply gave the lustre of mid-day to equipment I spied.

When what to my wandering eyes should appear, but a miniature sleigh and eight tiny reindeer.

With a little old driver so lively and merry, I knew in a moment it must be the X12 fairy.

More rapid than EDI his courses they came, and he whistled and shouted and called them by name.

"Now Dasher, now Dancer, now Prancer and Vixen!  On Comet, on Cupid, on Donner and Blitzen! 

To the top of the server, to the top of the wall!  Now dash away! Dash away! Dash away all!"

His eyes how they twinkled, his dimples how merry!  His cheeks were like roses, his nose like a cherry!

His droll little mouth was drawn up tight like a bow.  His beard was as white as the copy paper below.

He spoke not a word but went straight to his work, and fixed the EDI errors without a smirk.

He then laid his finger on the side of his nose, and giving a nod, up the cooling system he rose.

He sprang to his sleigh, and to his team gave a grin, and away they flew like a 997 after an 810 came in.

But I heard him exclaim, 'ere he drove out of sight, "Happy holidays from Aurora EDI Alliance and to all a good night!"

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Tags: EDI Technology, technology, EDI provider, EDI Consultant

The Cloud Crowd

Posted by David McAlister on Fri, Dec 01, 2017 @ 05:14 PM

bigstock-cables-connected-to-cloud-6459096.jpgEnjoying a beer at my favorite brewery over the holidays, my neighbor at the bar told me that Amazon's largest revenue comes from their server space rentals.  Who knew???  As consumers we have our eyes on all the products that they sell these days. There are actually people out there who buy virtually everything from the retail giant, from diapers to Xbox.  How nice is it as consumers to order something Thursday night after talking to someone at a Thanksgiving dinner and have it on our door step Saturday?  I have since learned that Amazon has been busy offering cloud services for more than a decade!

In 2006, Amazon launched their Web Services S3 offering.  Wikipedia reports, "Amazon S3 provides storage through web services interfaces (REST, SOAP, and BitTorrent).  Amazon S3 is reported to store more than 2 trillion objects as of April 2013.  S3 uses include web hosting, image hosting, and storage for backup systems.  S3 guarantees 99.9% monthly uptime service-level agreement.” 

At the same time Amazon also launched Amazon Web Services (AWS). Wikipedia describes it as, "…a subsidiary of Amazon.com that provides on-demand cloud computing platforms to individuals, companies and governments, on a paid subscription basis with a free-tier option available for 12 months.  The technology allows subscribers to have at their disposal a full-fledged virtual cluster of computers, available all the time, through the internet."

And if that wasn't enough there is Amazon Marketplace Web Service (Amazon MWS). Described by Amazon as, "…an integrated web service API that helps Amazon sellers to programmatically exchange data on listings, orders, payments, reports, and more.  Data integration with Amazon enables high levels of selling automation, which can help sellers grow their business.  By using Amazon MWS, sellers can increase selling efficiency, reduce labor requirements, and improve response time to customers.”

While Amazon continues to dominate the online world, they have now stepped into the brick and mortal retail space by acquiring Whole Foods Market and this last summer also opened their first brick and mortar Amazon store in NYC, The Shops at Columbus Circle.  Go figure!  Then there is Walmart who rules the brick and mortal retail environment. Walmart just bought Jet.com to bolster their online world by trying to offer something similar to Amazon Prime.  Furthermore, Walmart has been offering online sales from many retailers, including Wayfair and Hayneedle for some time now. The race is on for the consumers’ business on both fronts.

The list goes on to put pressure on the organization to integrate - Salesforce, social media, Shopify, etc.  Just when it was a lot to integrate with EDI, APIs are becoming common place in the market.

Thanks to our choice to integrate with ECS and Delta - a Liaison Small Medium Business (SMB) Enterprise Integration Suite, we take integration seriously.  Regardless of whether it is application to application disparate systems (A2A), Application to Web (A2W) or Business to Business (B2B), yes EDI, we proudly are glad to show off our toolbox to support clients in all their enterprise integration requirements.  Then when you bust out and cannot support your integration on one server, ECS/Delta can load balance between servers.

The day has come where IT needs to support internal and external requirements with an increasing speed of agility.  Whether it is ECS/Delta, Liaison Alloy, Amazon or any other cloud crowd, we are there to make your life easier and ready to serve you in this increasingly complex and competitive environment.  Get started by contacting us for a consultation!

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Tags: cloud, amazon, Integration, web services

Data Integration: A Buying Guide

Posted by Shandra Locken on Fri, Nov 17, 2017 @ 01:29 PM

bigstock--131190917.jpgThis blog was written by Jim Gonzalez.  Over the last 20 years I have been asked a lot of questions by customers and fellow peers about data integration. What I have found is that there are five questions that need to be answered and these are in no particular order. Of course, these questions can and often do lead to new questions.  But if you can answer the following initial questions, you will may just stop going in circles and start on a path to success.

File Formats/Layouts to be Integrated:
               
Are you looking to deal with EDI, XML, CSV, Pipe delimited etc..? A lot of times you will just need to start off handling one format based on your initial engagement. It could be an internal engagement between one department or another. It could be an engagement between your company and a buyer. As I said earlier answering one question can lead into a lot of other questions. Please try to keep your focus on what is right in front of you or upcoming in the next couple of months, not what could be many years away.  Long term goals need to be kept in mind while constructing a solution, but it’s easy to get sidetracked so it’s important to prioritize: now, one year from now, five years from now, etc.
 
Investment:
 
How much can you afford to spend? Truly analyze that question and know your answer. You will need to have your software costs locked down and not variable. A huge piece that most people don’t take into full consideration is professional services. Professional services covers billable hours for software installation, map development, consulting and training. Don’t allow a company or consultant to give you a range of hours they don’t commit too. If you allow them to change the hour range when there is no increase in workload it can ruin the entire project. All companies and individuals need to be held accountable to the Statement of Work.  You can’t change your mind and then expect the consultants to not change the hours required.  Just as a consultant can’t change the hours required to complete a project because they didn’t account for all of your upfront requirements.
 
ROI (Return on Investment):
 
How many work hours are you saving? This can be hard to quantify but see this blog for more info on that.  Also, would you be increasing revenue with customers? You have to factor in every value-add that data integration will bring. If you can pull it all together and effectively present to the upper level management, it will further your cause and help get your project approved. The more headaches that can be resolved and the less human intervention required will allow your company to accomplish its business goals.

Goals to be accomplished:
 
Was this mandated by a customer to continue doing business by using EDI or another format? Are you simply doing this to appease a disgruntled employee? Did upper level management hear of this new thing while at the latest conference? No matter how it came about, the bottom line is that you need to move forward with data integration. Keep a record of the successes you have accomplished as each process gets done. It will allow for a time line of events and can lead to more opportunities for data integration that you never even considered. I have implemented many systems over the years and resolved issues for clients who didn’t realize the issues existed.

On Premise or Hosted:
 
Can your current network handle the data integration? Do you need to purchase additional hardware? Do you have the staff to handle the support? How do you feel about another company hosting the hardware and software for you? Have you weighed the costs? The question of whether you’re better off with hosted or on-premise never has an easy answer and you will find everyone has an opinion. This usually is all preference based. My preference is to control the hardware and software in house. It is an investment that will pay off in the long run. Never allow yourself to get stuck in a short term solution that can’t grow with your organization.
 
My conclusion for all of this, is that you need to know what you want or at least have an idea.  If you can come up with answers to the above questions, with proper guidance you will be able to construct an appropriate solution to meet your business objectives. Since you are reading this, rest assured you have found yourself the right group of partners that you can trust. A good consultant can bring his or her years of knowledge and experience to help you succeed. When I finish an implementation I feel an accomplishment that is unmatched. Reach out and let us know the pitfalls you have going on with your company!  Take advantage of our no cost, no obligation consultation.

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Tags: EDI considerations, EDI software, data integration, hosted EDI, EDI Consultant

Comparing ROI for Integrated Electronic Trading

Posted by Shandra Locken on Fri, Nov 03, 2017 @ 08:30 AM

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Picture appears courtesy of GotCreditThis blog was written by Karen Blood of GraceBlood LLC.  Most retailers and e-tailers, and an increasing number of other businesses, will only purchase from suppliers who will do business via EDI or some other B2B electronic trading platform.  Not to worry:  this mandate can have tangible benefits for your company too. These benefits are both strategic and operational.  B2B electronic capability can strategically give you an advantage by strengthening your relationships with customers and vendors, improving loyalty and long-term alliances. Your “EDI-enabled” business opens the door to increased sales over the same channels – improving your bottom line.  In the process you become more competitive and able to thrive, directly affecting the value of your company.

Operationally, B2B electronic trading reduces both the time and human attention required to complete data entry and order processing. Your integrated capabilities deliver faster order processing with fewer manual errors and faster delivery times which increases customer satisfaction. Decreased operating expenses and improved accuracy in fulfillment and procurement can deliver profits and improve cash flow.

While strategic benefits can be difficult for which to calculate Return on Investment (ROI), we can easily do so for the operational benefits.  For suppliers, a decision on how best to approach a mandate to retain or win the customer’s business should include a careful consideration of ROI.

While many supply chain companies operate with a mix, let’s consider ROI using three approaches, one manual and two integrated:

  1. web-trading, where your orders are picked up, entered, acknowledged, and processed through to an invoice either manually or by visiting a website
  2. on premises integrated, where your routine orders appear in your order processing system and are processed through to invoice by an intermediate system that is located and operated within your business
  3. cloud-based managed services, also integrated and where your routine orders appear in your order processing system and are processed through to invoice through an intermediate system located in the cloud and is operating transparently

ROI may also be useful in evaluating a move from web-trading to one of the integrated approaches or between them.

Let’s look at an example that you can easily tailor and use. First, we calculate our own average cost to process an order. Add up the annual manual or non-integrated order processing expenses – from receipt of order, to entry, to acknowledgement, to shipping notice, to invoice – considering all personnel, overhead and equipment, and adding in any fees charged by customers for using their portal or for failing to comply with their preferred trading approach. Divide this annual total expense by the total number of sales orders processed during the year.  This becomes your cost to process an average order.

Aberdeen studies have estimated typical savings with end-to-end electronic processing of an order as compared to manual in the 60-75% range.   This example projects an average distributor for three customers integrating four documents over the end-to-end order to invoice process and trading 500 orders/month while conservatively projecting a 50% savings for integration over manual processing.

Click below to download a spreadsheet for use in calculating and comparing your own Return on Investment for B2B Electronic Trading. Only a few additional inputs are needed, and these are in yellow. Besides the Average Cost per Manually Processed Sales Order, count your top routine customers and determine the total # of orders you receive from them in a year. Typical transaction types of documents to integrate are the inbound Sales Order, the outbound Order Acknowledgement, Ship Notice & Invoice. Adjust If your partners don’t usually need all four.

This takes care of our Manual or Web Trading column and calculates our cost to process all the chosen customers’ orders end-to-end. For the On Premises column, we must consider our initial investments in software and systems, as well as ongoing operational and maintenance expenses such as staff and transmission fees. These may vary based on your ERP’s capabilities and version, and your customers’ requirements. Similarly, for cloud-based Managed Services, while there may be an initial investment to augment your ERP’s capabilities, the costs for translation mapping, transport and testing are included in the Managed Services Startup Investment while activity, monitoring, maintenance and management is included in the Managed Services monthly Activity.

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While ROI will vary, we can see that in addition to the perceived strategic benefits of Integrating Electronic Trading, we also can simply demonstrate and quantify an operational Return on Investment that is unique to your company.  Of course, adding additional partners – a very wise step to take after initial investments – results in a multiplier effect and adds even more to your bottom line.

Click below for access to the handy spreadsheet illustrated above.

Download ROI Spreadsheet

Tags: data integration, supply chain, EDI ROI, hosted EDI, electronic data interchange, Web EDI, Managed Services, EDI