What is EDI?

Electronic Data Interchange (EDI) enables automated and secure transfer of electronic business documents between companies without manual intervention. Instead of utilising various connections and platforms to trade with your partners, EDI enables a single connection for business to connect and transact with many of their trading partners.

The benefits of moving over to automation includes:

• Improved Accuracy and Enhanced Quality of data: Due to the fact that orders are imported directly, there is less manual intervention that can cause human errors.
• Automated workflows: Allows for immediate document processing which speeds up your business process and efficiency.
• Faster business cycles: Improves the speed at which you interact with your trading partners.
• Improved Visibility: Visibility of documents within your operating ERP system which eliminates handling sheets of paper or multiple PDFs.
• Exception Management: Allows you to focus on exceptions brought to your attention via the EDI process.
• Audit Trail: All the information is easy to track and is automatically filed within your business ERP system.

How does EDI work?

As the need for greater operational efficiencies increases automation speeds up business cycles by creating automated workflows. Traditionally businesses rely on emails and customer portals to access purchase orders and send invoices. EDI creates a seamless integration point which mitigates the need for manual capturing and processing of business documents.?

1. A sender exports a business document from their ERP system. In this example we could use a purchase order.?
2. The purchase order is automatically collected and verified through a number of checks i.e. pricing, article codes, UOMs.?
3. Once the order has passed the validation checks it then automatically populates within the receivers ERP system as a sales order.?
4. Upon confirmation of the order, an order acknowledgment is then sent to the sender.?
5. Once the receiver has processed the invoice, the document is then collected and passed onto the relevant customer.?

Conclusion

It has been reported that less than 50% of companies are able to access supply chain information to gain business insights they need to make faster, better decisions. EDI mitigates this risk by allowing full visibility and audit-ability of all transactions within your customer base in real time. For more information please visit www.m2north.com