EDI Myths Vs Facts

Intro to Electronic Data Interchange

Electronic Data Interchange (EDI) has been in use since the 1960s, however in more recent years EDI came to play a key role in enabling supply chain automation, digital transformation, and B2B business process automation.

More than 85% of all electronic business transactions take place using EDI. This method of exchanging documents is used in industries including retail, banking, high-tech, manufacturing, and services. 

EDI follows a certain set of standards that allow the sender’s documents to flow straight through to the intended application on the receiver’s end. This enables the processing and return of documents to be accepted and processed immediately.

MYTH

FACT

EDI is too expensive

Yes, EDI can be expensive, however the benefits outweigh the cost. 

EDI reduces order to cycle time by upwards of 75%. The benefits of EDI outweigh the costs by shortening lead time for product enhancements and new product delivery. Streamlining the ability to enter new territories and markets. While promoting corporate social responsibility and sustainability by replacing paper-based processes with electronic alternatives.

EDI requires expert skills and is difficult to understand

EDI integration helps streamline key business practices, which translates into better communication and security. Collecting data, processing, and mapping coming in from multiple sources use to require higher levels of expertise as well as hundreds of manual man-hours. However, today, many tools and technology-led processes eliminate the need for high-end expertise.

Companies can hire a third-party to manage a part or the entire process of using EDI to exchange data with trading partners. EDI outsourcing is a great option for smaller sized businesses however companies of all sizes can benefit from outsourcing EDI processes. 

I don’t need EDI, my ERP system works as a B2B integration platform

ERP systems are capable of many things, however they are not designed to take the place of a full-fledged EDI solution that includes communications, mapping and translation software.

When there is integration between EDI and ERP systems, the two systems combined enable you to process orders faster, accelerate the order-to-cash cycle, and provide the capacity to drive higher revenue. 

It takes too long to implement an EDI solution

EDI can be a time consuming task if you are looking at a robust integrated software solution with multiple trading partners. However the small – medium size businesses who were mandated by a retailer to be EDI complaint, can be up and running in a matter of weeks with a web or cloud based solution like Internet EDI

EDI is going to be obsolete

EDI has been around for decades and has remained a staple in the B2B communications realm all these years. According to a report from Fortune Business Insights, the global EDI market is projected to reach 4.04 billion USD by 2029. The interest in EDI systems continues to grow as the frequent transactions between small businesses and large organizations aid market growth.

Sign up for our Newsletter