In any company, it is essential to be able to process data and information from customers and suppliers, and on processes and products. However, if data is transported to be processed on different media, data errors often occur during transmission and the business process is unnecessarily slowed down (see also SEEBURGER BLOG: SEEOcta Data: Data Governance). One of the biggest challenges in designing efficient business processes is to enable inter-company data exchange with suppliers and customers without having to manually move the data from one media to another. This seamless data transfer has a number of advantages in-company as well. EDI– and API integration are solutions which can network applications and systems. This allows business documents such as customer enquiries, quotations, orders, delivery notes and invoices to be exchanged electronically in a coordinated, structured form. Learn more about the advantages of seamless data exchange along the entire supply chain and within a company through EDI and API integration.
The SEEOcta blog series highlights the eight most important perspectives for successful project management. Discover all the areas you need to consider when planning digitalisation and integration projects in your company. Armed with the ideas and knowledge in the articles, you will have a solid foundation for planning your IT project and a guide to help you ensure that no one gets left behind.
Seamlessly exchange files and data along the entire supply chain with EDI
Do you sometimes have to transfer data from one system to another with a memory card, print out something for another colleague to read, or manually enter data from a paper-based document? Electronic Data Interchange (EDI for short) eliminates these time-intensive, error-prone steps. EDI has already been used for around 30 years for paperless document exchange between business partners, including purchase requests, orders, delivery notes and invoices. It is used by a number of companies at all stages of a supply chain and facilitates global cooperation and networking the value chain, from procuring the raw materials through the various processing stages to the end consumer. As supply chains become ever more complex and extensive, information management will play an increasingly significant role in meeting market expectations.
There are a number of different types of data and document exchanged within a supply chain, as illustrated in the image below:
When you think of a supply chain, you tend to think of a flow of goods and money. However, none of this would be possible without an information flow. Since companies of all sizes are involved in a supply chain and they do not necessarily use EDI-enabled systems, there are various solutions to quickly and easily connect your suppliers to your EDI. Modern supply chains, such as those found in trade or in the automotive industry, would simply not be possible without structured data exchange. As companies are becoming less vertically integrated in their own supply chain, manufacturers and suppliers need to cooperate ever more closely. Just in Time (JIT), Just in Sequence (JIS) und lean management are all methods which can only result in a smoothly running production line if structured data is made available all along the supply chain. EDI is a fast, efficient way to send business documents as structured data to companies all over the world.
Seamless data exchange: EDI versus APIs
As a result of its many years of worldwide use, EDI is a mature and robust way of enabling cross-company data exchange. Its high adoption rate makes it easy to efficiently connect to suppliers. EDI’s seamless message exchange between companies uses established standards for business documents (including EDI message standards) which players within an industry have agreed on among themselves. This exchange encompasses three steps; connect, convert and communicate. A challenge here is the memory delay. This can lead to decision being made based on information which has since changed. You can read more about the top 6 EDI challenges and how to best address them in a dedicated post.
Application Programming Interfaces (APIs) are often referred to the EDI of the 21st century. APIs can network applications, systems and partners in real time. From mobile apps, e-business or cloud to connecting a physical location or cash register, APIs enable fast, secure, uncomplicated access to data and functions from within business processes. This real-time data exchange is what makes APIs so effective compared to APIs. Once APIs have been set up, functions and data from existing applications is made useable for other systems and applications – seamlessly.
Implementing APIs – and managing them – is cheaper and simpler than for EDI, as you don’t need ongoing maintenance or conversion services. When integrating a new trading partner, your main task is to give applications and other programmes access to selected (system) data and functions. There are always two parties involved in such a scenario; one, who has data and allows access to this (provider), and one who calls up and ʽconsumes‘ the data (consumer). APIs enable you to exchange data in real time, something which is critical for some business models and processes. To get the most out of your APIs, and to ensure they are secure, you will need professional concepts or api solutions for their security and api management.
How does seamless data exchange with EDI and APIs impact work in the office?
In-company, EDI and / or API integration reduces admin costs. In companies with more traditional organisational structures, when files and data are received they will often go through a chain of command to be approved before being processed. This costs money. However, by employing EDI or APIs, items received can be automatically passed on to the relevant signatories, accessed by all stakeholders from their own desks, and processed – without ever leaving the system.
EDI and API integration can therefore significantly reduce your admin costs. This does however involve tweaking your processes; higher task integration, decentralisation and delegation: (see the SEEOcta Processes article on Business Process Reengineering)
- Task integration
Do employees have direct access to the data they need? Could certain tasks be bundled together; vertically or horizontally integrated?
- Horizontal task integration: The various components of jobs previously done piecemeal such as order processing, warehousing and inventory or choosing suppliers, are bundled into functions.
- Vertical task integration: One department is responsible for a contract, from receipt to completion.
Data received from external partners can be passed on to any employee who needs it without ever leaving the system. No downloading, no saving to a flash drive, no printing. This essentially means that tasks can be completed by anyone with the right skills, regardless of their department or where their desk is. This decentralisation of information enabled by using EDI/API also supports a less rigid skills and function structure in a company, which supports more efficient processing.
Decentralising data requires employees to have a certain autonomy, to use their initiative and to be able to see the whole picture (see the SEEOcta article on Agile Organisation). EDI/API integration makes it easier to delegate tasks to the employees who need to carry them out.
EDI and API integration enable seamless data exchange along the entire supply chain as well as in-company, ultimately leading to more efficient processes and lower costs. Depending on how you employ EDI and APIs, there are a range of possibilities open to you including a higher degree of automation, a more efficient organisational structure, or creating completely new business models. This potential is because EDI/API enables technical networking beyond company premises, whereas previous solutions could only be used in-company.
As an experienced expert for integration solutions, SEEBURGER uses a centralised, agile and scalable integration platform, the SEEBURGER Business Integration Suite (BIS) to network systems, applications, customers and partners. This ensures that the right data gets to the right place at the right time –within and beyond the company.
 Vgl. hierzu auch Rahild Neuburger, Electronic Data Interchange, Springer Fachmedien Wiesbaden GmbH 1994, S. 50
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Written by: Rolf HolickiRolf Holicki, Director BU E-Invoicing, SAP&Web Process, is responsible for the SAP/WEB applications. He has more than 25 years of experience in e-invoicing, SAP, Workflow and business process automation. Rolf Holicki has been with SEEBURGER since 2005.