We’ve been using and talking about EDI – Electronic Data Interchange since the 1960s. But does it still make sense to talk about it today?
Luckily, EDI isn’t anymore that slow, rigid and expensive technology, suitable only for big companies, as it was known until 20 years ago. On the contrary. Do you know that EDI can be a flexible and scalable solution, the key factor for digital transformation and process optimization?
Let’s see what EDI services mean today.
What is exactly EDI? A definition
What is exactly EDI?
Electronic Data Interchange, in short EDI, is the automated computer-to-computer exchange of business documents between business partners in a standard electronic format over a secure standardized connection.
(For further info, read our FAQs about EDI.)
Basically, EDI services facilitate electronic commerce and improve business relationships between partners.
How? By the standardized transmission of orders, invoices, delivery notes and the integration with ERP systems. Process optimization and reduced waste and errors are the results of this automation.
What you should expect from your EDI provider
In order to achieve these benefits, regardless of the type of EDI service they are providing, whether it is a classical EDI solution or a modern EDI web service, your EDI provider should offer:
- data mapping: in order to have a clear picture of data flows, when you exchange different data formats with your partners
- data translation: so that all the systems involved receive information in an understandable format
- tools to check and maintain data quality and integrity
- connectivity management: as many different systems need to be connected, it is essential to manage the communication between the partners.
Problems of traditional EDI solutions
The world today is increasingly fast and liquid, the traditional EDI solutions have started to become outdated.
Instead of optimizing your processes, they could create inefficiencies.
For example classical EDI includes on-premise hardware and point-to-point connections. The main problems of these solutions are:
- high purchase and maintenance cost (only affordable for big companies)
- high effort to make changes (new partners, connections, …)
- slow onboarding of new partners
- connections difficult to manage.
Benefits of a cloud EDI solution
To overcome those limitations, new alternative and flexible web EDI services have emerged, suitable for any type of company.
Which benefits does a cloud EDI provider offer?
Here is a list of the main advantages:
1) A cost effective EDI service. You don’t need to purchase any EDI software, hardware or software updates or install anything on premise.
2) A scalable solution: you could start small, measure the results and then decide to create more connections. The solution could be quickly re-adapted throughout the years, when you need to onboard new business partners.
3) A flexible and tailored EDI service, that adapts exactly to your needs and procedure. As we mentioned here, this means that the solution:
- could be integrated with any type of ERP system, without limitation
- could integrate any type of customer or supplier, regardless of its size
- could manage any type of data format, protocol and transmission channel.
4) A quicker onboarding process, thanks to a faster and leaner data mapping.