It’s 2017, technology is practically everywhere and everyone is digitally connected. Most businesses have adapted to the changes in tech, yet some are still behind.
That’s not necessarily a bad thing! Every business works how they know best and to the best of their means. Digital supply chain is the optimal solution for businesses looking to obtain a game-changing benefit.
Based upon a SCM World study, 77% of companies in early stages of B2B integration processed less than 50% of their transactions digitally.That means there is a remaining 50% or more companies that are currently using traditional methods to exchange information (i.e. email, fax, and phone) instead of utilizing automation. That separation of formats creates a barrier between two parties which will lower total returns and affect projected goals.
So how does a large, digital business connect with a smaller business that is using traditional methods? Well, it’s easier than you think
Utilizing electronic data exchange (EDI) or extended markup language (XML) will yield the highest results by generating and receiving digital transactions between trading partners.
What is EDI? EDI is the computer-computer exchange of business documents in a standard electronic format, typically between business partners. EDI allows the ability to create an automated document process which will save time and money.
It will also improve processing speed, reduce the number of errors, and aid the relationship between partners.
Now, not all business partners have the means to utilize EDI. It may be the case of their IT department not being large enough to manage EDI, or it may be that they don’t have an IT department.
The cost and usage time of using EDI up may be too great if their larger trading partners don’t transact as frequently with them. Nevertheless, if you have a non-EDI partner, there are still options you can use to make digital transactions work effectively.
- Web Apps. Web apps are very common in today’s solutions, they allow easy access from any computer your partner may use while providing a simple solution to digitization. Web apps can provide common data entry and the ability to review transaction history. The data entry becomes a digital transaction which can be processed automatically and converted to EDI to be processed like other digital transactions. Web apps can reduce errors and provide feedback based uon executed business rules.
- Web Forms. Web forms are useful for creating data entry when filling out specific documents. They are simple to setup and help by automating the processing. Just like a web app, a web form can be converted into EDI and processed. There are some drawbacks in that there is no feedback given to the user (which a web app can provide).
- Fax & PDF to EDI. Both Fax and PDF can be converted into EDI which would allow those small partners to continue their normal transaction methods. It would require you to scan the received documents and then convert them into EDI data for processing. This method should be reviewed by an individual to ensure the data is correct, we recommend indicating the required fields.
- Spreadsheet to EDI. Using Microsoft Excel or a similar software is similar to a web form, it can check for user error and check the data field contents making sure they are filled out and complete. It’s a method that is simple to use as many businesses have access to Excel.
Once you have finalized your best form of data transaction with your trading partner, you can start enjoying the results. You will see:
- Faster invoice time
- More responsiveness to unforeseen events
- Faster inventory turns
- Reduction in cash to cash cycle time
- Improvement in successful product launches
- Improvement in perfect orders