Empowering Your Supply Chain: The Transformative Impact of Supply Chain Transactional Efficiency and Competitiveness.

According to a recent IDC white paper that analysed the strategic significance of IBM Sterling Supply Chain Business Networks, it has become increasingly apparent to businesses that they must enhance their supply chain capabilities to remain competitive. The comprehensive supply chain survey conducted by the paper revealed that 60% of companies anticipate being outpaced by a rival with superior supply chain capabilities in the next three years. This leads us to the question:

What are superior supply chain capabilities and how can we achieve them to retain our competitive edge?

Effective EDI (Electronic Data Interchange) management plays a significant role in the above capabilities because EDI allows for the exchange of electronic business documents such as purchase orders, invoices, and shipping notices between trading partners. By streamlining these processes and reducing manual data entry, EDI can improve supply chain efficiency, reduce errors and delays, and provide greater visibility of the status of orders and shipments. All of which ultimately leads to better supply chain performance and a competitive advantage ensuring that your organisation isn’t part of the statistic that loses out to competitors.

There are two schools of thought among those who have recognised the importance of these capabilities: those who choose in-house management and those who prefer a managed EDI service. It is important to take an honest review of both options before making a decision.

In-house EDI management

In-house EDI management involves a company using internal resources and personnel to manage its Electronic Data Interchange (EDI) operations and infrastructure. This approach requires businesses to be responsible for selecting, installing, and maintaining the necessary hardware and software, as well as managing day-to-day EDI operations. Though in-house EDI management might seem like a straightforward decision, it is essential to consider the various activities involved, such as selecting appropriate hardware and software, ensuring compatibility with existing business applications, and managing trading partners. Compliance with industry standards and real-time monitoring and support are also critical aspects.

Effectively managing your own EDI can be challenging and costly, as it requires a significant financial investment and securing personnel with EDI expertise. A frequently underestimated consideration is the substantial allocation of personnel resources required to coordinate with third-party partners or their suppliers for obtaining connection specifics. Keeping up with evolving EDI standards and regulations can be difficult, and failure to comply can result in fines or penalties. Additionally, scaling your EDI system to meet the needs of a growing business can be demanding and may cause transaction delays or errors.

Downtime or technical issues with an in-house EDI system can impact your supply chain and bottom line.

Overall, managing your own EDI requires a significant investment in time, resources, and expertise, which is probably why many businesses choose to outsource their EDI operations to third-party providers.

Managed EDI services

A managed EDI service (third-party service provider) can provide a comprehensive range of services to assist businesses with their EDI operations, including hardware and software procurement, installation and maintenance, monitoring, troubleshooting, and ongoing support. It is important to note that managed EDI services can encompass various services tailored to the unique needs of each business.

Some common services that an EDI managed service provider (MSP) may offer include:

  • Setup and configuration: Assistance with the initial setup and configuration of the EDI system, ensuring that it meets the specific needs and requirements of the business and its trading partners.
  • EDI integration and mapping: MSP’s help businesses integrate their EDI systems with their existing business applications and map their data fields to ensure that the data is transmitted accurately.
  • EDI translation: They can translate EDI messages into a format that the business can easily read and understand.
  • Connectivity: An MSP can secure reliable connections with trading partners, enabling efficient data exchange through various communication protocols such as APIs.
  • Trading partner management: MSP’s help businesses manage their relationships, including onboarding new partners, setting up EDI connections, and managing EDI transactions.
  • EDI compliance: Managed EDI service providers can help businesses ensure they are complying with industry standards and regulations as well as trading partner specific requirements.
  • EDI monitoring and support: They can monitor EDI transactions in real-time and provide ongoing support to help businesses resolve any issues that may arise.
  • Scalability and flexibility: As a business grows, managed EDI services can easily scale to accommodate increased data volume and complexity.
  • Data backup and disaster recovery: The service provider ensures that data is securely backed up and provides disaster recovery solutions to minimise the risk of data loss or downtime.
  • Cost savings: By outsourcing EDI operations to a managed service provider, businesses can reduce the costs associated with in-house EDI systems, including labour, infrastructure, and maintenance expenses.

While outsourcing EDI to a managed service provider offers huge benefits and prevents many of the pitfalls associated with in-house EDI management, it is essential to recognise that managed services can also come with their own set of challenges.

The decision to switch from an in-house EDI management system to a managed service can still be problematic if your organisation fails to understand and assess the issues that are unique to your supply chain ecosystem.

With over two decades of experience as provider of EDI and File Transfer solutions, we have garnered valuable knowledge on how to expedite our clients’ projects to ensure a consistent and successful delivery. However, equally important is the invaluable insight we have accumulated regarding problem areas and common traits that our clients have encountered.

We have identified four issues that often prompt customers to seek our help in managing their EDI transactions:

  • A loss of expertise to run a reliable internal service, which can result in errors and delays in transactions.
  • A growing concern over the length of time required to onboard new trading partners or customers, leading to internal friction with other departments, such as Sales or Supply Chain.
  • The challenge of finding and then managing multiple EDI solutions, which can be costly and difficult to coordinate.
  • A lack of real-time visibility into why transactions may be failing or incorrect, which can result in a significant impact on the supply chain and overall business operations

Our first recommendation to our customers is always to address any internal issues within their organisation. This  involves careful consideration and planning, and our team offers guidance on how to effectively tackle these steps.

Although some of these steps may seem obvious, it is surprising how often potential customers approach us without having fully thought through these critical stages:

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STEP 1
Assess your current B2B processes

Understand how you currently exchange business documents with your trading partners and identify any inefficiencies, bottlenecks, or challenges in the process.

STEP 2
Define your requirements

Determine what types of documents you need to exchange, how frequently you need to exchange them, and what standards and formats are required by your trading partners.

STEP 3
Develop a solution

This may involve process changes to improve integration, modifications to existing software and hardware, or implementation of new technology to keep up with the competition.

STEP 4
Evaluate your technology infrastructure

Understand the capabilities of your current systems and identify any gaps or limitations that may impact your ability to implement an EDI solution.

STEP 5
Identify potential partners

Research and evaluate EDI solution providers to identify those that meet your requirements and have a track record of success in your industry, like Coliance.

STEP 6
Plan for implementation

Develop a detailed plan for implementing an EDI solution, including timelines, resources, and testing procedures.

By taking these steps and investigating your business needs and capabilities, you will be better equipped to select an EDI solution that meets your specific requirements and delivers maximum value to your organisation.

Managed EDI services from Coliance offer a range of benefits to enhance your business operations. By streamlining processes, automating data exchange, and reducing manual data entry, we boost your efficiency and productivity. Our services provide improved data accuracy, standardised communication formats, and a reduced IT burden, enabling a greater focus on core competencies. 

Coliance’s experienced team manage the setup, configuration, testing and monitoring of your supply chain transactions. Our cloud-based managed services ensure easy scalability, reliability, and uptime, promoting better supply chain visibility and relationships with trading partners. If you want to experience substantial savings in labour, infrastructure, and maintenance costs contact Coliance today.

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