Building a Strong EDI Department and its Role

A strong and competitive EDI department is a necessity. An EDI department serves only a few departments, such as customer service, shipping, and accounts receivable, and it must serve them well. Its purpose is automation that cuts cost, improves customer service, and ensures that key customers pay promptly.

All companies that do EDI must exchange documents such as invoices, purchase orders, and shipment notices with key customers and vendors:

• Effectively
• Reliably
• Swiftly
• Securely
• Economically

However, before you can build a strong EDI department, you must have a good grasp on where you see EDI within your company.

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Understanding the EDI Role – Is it an IT Role or Business Role?

IT Role

In most companies, EDI is an IT role. IT controls the resources and therefore the agenda and timelines. IT controls the rollout of new partners and provides the resources to do the mapping, communication setup, and trading partner testing. Unfortunately, many IT departments are taxed for resources, haven’t budgeted for bringing on new trading partners, and probably don’t have the resources that do EDI all the time. The result: EDI gets implemented at a slow pace, often resulting in trading partner issues and possible loss of income.

Business Role

EDI may also be seen as a business role with the business unit working on doing all the setups. Projects take forever to get setup or they don’t get setup because the business operations people do not have the requisite technical expertise. The result: you may end up using web based EDI services, services that allow the business unit to do EDI without needing the involvement of the IT group.

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In House versus Outsourcing

The ideal scenario is when the response to a project is done in a quick and in a timely manner to trading partner requests when there is a partnership between the IT group and business unit. In reality, your IT may not understand the business implications of EDI, and the business unit does not have the technical skill to do the needed EDI implementation and setup, streamlining the process. This works for many companies, but not all.

If you are too small to have a dedicated EDI team, a great option is to hire a company that can act as your EDI group, such as Data Communication Solutions (DCS). Hiring the resources of an outside expert gives companies a leg up. Implementations can be done quickly and in a more cost effective manner using expert resources. Budgeting a yearly dollar amount for managed services versus hiring a dedicated resource in house can make good business sense and reflects positively to your bottom line.

Many companies have very small or non-existent EDI departments. Demands from trading partners pose an immediate strain on the IT department. At this point, there are basically two choices:

1. Hire additional personnel (which is very costly)
2. Outsource the EDI projects

Outsourcing your EDI projects is a very cost effective approach to meeting the mandates from your trading partners.

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Standard Daily tasks required of an EDI department

Most small EDI/IT departments focus on the day-to-day operations of monitoring and resolving performance issues such as:

• Monitor daily EDI operations and performance.
• Analyze transaction files to identify data errors, transmission errors, and mapping errors.
• Provide technical support of the EDI application, mappings, and interfaces.
• Provide 2nd level production support.
• Research, track, and resolve EDI issues.
• Work with VAN’s to resolve transmission issues.
• Maintain EDI documentation.
• Serve as a point of escalation for EDI related issues.
• Serve as a key EDI contact for vendors and internal Role organizations.

Additional development work and projects can soon overload a department. Companies can soon find themselves losing profitability because they can’t take additional development tasks such as setting up new EDI trading partners.

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Additional EDI Tasks

 Many EDI development projects get overlooked or simply not done due to lack of time, budget, or personnel capabilities. Here is where outsourcing can benefit you. By working closely with your EDI/IT departments, outsourcing provides:

• Dedicated hours towards specific projects directed by management.
• Collaborate with vendors, trading partners, and internal teams to define EDI requirements.
• Create and maintain EDI mappings.
• Setup new EDI trading partnerships and assist with on-boarding of the trading partners.
• Provide technical support of the EDI application, mappings, and interfaces.
• Integrate EDI to business processes.
• Work with trading partners and internal teams to troubleshoot data issues and mapping issues.
• Assist with trading partner compliancy.
• Act as overall EDI subject matter expert from a technical standpoint as well as from a processes standpoint.
• Work with vendors to maintain EDI software, such as the testing and application of patches and upgrades.
• Recommend and establish EDI process standards.

As you can see, there can be a lot more to EDI than just monitoring your system.

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Creating Building Blocks for a Strong EDI Foundation

Once you determine how to manage your EDI,  it’s time to consider the following three building blocks to a strong EDI foundation.

1. Network & Internet Service Provider

The first building block is your network and Internet Service Provider (ISP). This means your translator, which accepts an EDI transmission and converts the data into proper format.

A good collaboration of the EDI department and network support is also essential. The EDI department needs to understand the network side and vice versa. Everything from hardware, database, and email should be able to be supported by both.

2. Software & Maintenance

The next block is your EDI software and maintenance. They need to be a workhorse. They should not only be easy to use, but also responsive with no daily tweaking needed. If you or others are making changes daily, your system is not reliable and must be fixed immediately. This may go hand in hand with having your software installed properly. You need to make sure it is sized, maintained, and installed on appropriate hardware.

Don’t forget the importance of having a Disaster Recovery Plan in place. System crashes are costly. If so, have you verified it works? The plan should be documented well and tested to ensure you are prepared for an emergency. Your tools should be able to run in any light-out scenario because that is what will make a difference if a problem arises. This includes your scheduler, notifications, and reports.

3. Data Flow & Content

Lastly and most importantly, your data needs to reach its destination 100% of the time. Your external communications should be confirmed using acknowledgments such as MDNs, 997s, and control documents. Your internal communication should be using status messages.

Accurate data is the most important part of your process. If there is missing or incorrect data, it must be managed, whether that is with acknowledgment reports or BD87s and workflow. No data corrections should be needed after the fact; it should be correct every time it is sent.

You may think this requires customized mapping for standard transactions, but there is no need to “re-create the wheel.” Odds are Fortune 500 and Fortune 1000 companies around the world have probably run into the problems you face at one point or another. Searching out these options will benefit you in the long run. If you ever plan to upgrade your system, custom code and workarounds will only add more headaches.

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Conclusion

There are many factors to think about when building a strong EDI department, but these three blocks should be your main focus. You may have many of these under control, while some may be slipping by the wayside. Our DCS Consultants are here to help you throughout your process, no matter what you currently have or plan to have. We have the experience not only with your software, but also your industry. Contact us today to begin your No-Cost Assessment and get the ball rolling in the right direction.