3 EDI Supply Chain Trends to Watch in 2020

If you help run a product company or hardware startup and you want to grow your sales channels, you know that  many retailers require EDI as the standard way to communicate. EDI has been around for years, and although it can be daunting to implement, EDI automation will help streamline the communication between your operations team and your retailers. It will also  help reduce errors and delays that often occur during the ordering, fulfillment and administrative processes.

What is EDI?

EDI stands for electronic data interchange (sometimes also referred to as data exchange). It is an amalgamation of computer systems and processes that allows manufacturers the ability to share business documents and a variety of transactional information with vendors, suppliers, and brands that they work with. It creates organization, structure, and flow of important information that needs to be separated to these various groups or destinations, by using an electronic format that can integrate into any number of communication channels.

Any supply-chain-centric business will interact with EDI in some way, shape, or form (even the ones that primarily rely on non-EDI data exchange), and it’s the companies who take advantage of modern EDI platforms that will thrive in the current fast-paced market run by digital platforms and ecommerce channels.

For many organizations, outdated IT infrastructure is a common problem and EDI is an important piece of the supply chain puzzle that suffers if technology systems aren’t up-to-date.  There is huge value and market advantage in the B2B data exchange that EDI enables.

Companies who partner with modern third-party logistics providers (3PLs) or can invest in good EDI and integration platforms can better manage their supply chain ecosystem. They will see the following benefits:

  • Improve order-to-cash and procure-to-pay processes
  • Meet benchmarks and important KPIs for shipping and logistics
  • Enable visibility of fulfillment and delivery
  • Connect applications for end-to-end data processing
  • More reliably meet customer and partner SLAs
  • Reduce chargebacks and non-compliance fines

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EDI Trends to Watch in 2020

Because technology tools are always changing, improving, and adding capabilities, it’s important for companies to keep up with EDI updates and modifications. Knowing the top EDI supply chain management trends will help companies address new systems and grow their businesses.

EDI Modernization

EDI has been around for quite some time now, but it has only begun to reach a mature stage recently. Over the years EDI has become more than just a standardized data format, it is a set of processes that interact within a broader business ecosystem. EDI secures important information and governs who receives it and where it goes.  A modern EDI platform will help manage partner relationships and consistently improve the business processes that matter. It will also support all the non-EDI and ad-hoc data flows that the supply chain ecosystem needs to support. Today’s EDI technology arms companies with a platform to better execute these supply chain challenges in a modern way.

Integration of EDI and APIs

EDI and APIs (application programming interface) have been considered adversaries, but as critical as EDI is to an organization, APIs are just as integral. APIs offer additional communication flexibility, so you can more easily exchange data with cloud-based apps and other digital ecosystem systems. Instead of having to choose one over the other, companies are learning the power of EDI and API technologies working together. If you plan on evolving and growing your business, then supporting EDI and API-based processes simultaneously will give you the flexibility to support everything from legacy B2B technologies to SaaS applications and cloud storage platforms. The reality is that you shouldn’t have to pick one or the other, as they largely augment each other.

IT Skills Advancement

As cloud computing continues to infiltrate enterprise IT, the need for highly skilled professionals cannot be understated. Someone that is properly trained and able to handle EDI integration requests across an environment is extremely valuable in today’s modern enterprise. The problem is that these skilled IT professionals aren’t exactly easy to come by, and in fact, the necessary skill sets are rapidly evolving. Traditional EDI analyst roles, for example, are evolving into business analyst roles, where they work less on actual EDI data mapping or configuring partner requirements and more on overall trend analysis. These team members will ultimately embrace what the EDI data is telling them to improve partner relationships and design strategies for enhanced business outcomes.

Bottom Line

The right kind of EDI platform will enhance your operational efficiency, improve your relationships with your customers and trading partners, and give you increased visibility into your overall supply chain. Before updating your EDI, the first step is to make sure  you securely integrate your end-to-end ecosystem, which is no easy task given the range of legacy systems and cloud applications in use today. If you are a small company, or just starting out, working with a modern 3PL can give you a big advantage as they will likely have the most updated EDI and technology infrastructure to help support your business growth.

If you are looking for logistics support we would love to hear from you. DCL has a great EDI platform that integrates with our proprietary fulfillment software platform, eFactory. Send us a note to connect about how we can help your company grow. You can read DCL’s list of services to learn more, or check out the many companies we work with to ensure great logistics support.

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