Advanced Ship Notice (ASN), Vendor EDI, Supply Chain EDI, EDI, ERP

In many businesses, EDI processing is like the circulatory system in the human body, and the ERP system is the heart of the business. In other words, EDI is important! Many industries have leveraged EDI’s impact on efficiency to scale operations in a manner and cost structure that would be impossible without it.  The ability to automate repetitive office tasks to integrated EDI is transformational.   

Many enterprises rank their suppliers using a scorecard model that rewards better performing suppliers and punishes those that are difficult to do business with. Unsurprisingly, EDI is a significant factor on supplier scorecards, since mistakes and delays can hamper the ability to execute business.shutterstock_204413116_scorecards

A good example of how a supplier can undermine a customer is Advanced Ship Notices (ASN). ASN’s tell the recipient what they will be receiving, and often in significant detail, so that the receiving of the goods can be handled through a simple scanning process. Distribution centers often operate at high rates of speed, and ASN-related mistakes can cause costly operating inefficiencies and overtime. Imagine a truck arrives with one supplier’s goods. When a proper and timely ASN is received, the work of the warehouse team is quite simple – scan and put away or crossdock the goods to the final destination(s)

Now imagine a second supplier’s truck arrives, but the ASN has not been received by the warehouse. The scans will not work as there is no information to receive the goods and they have to be moved to another location or rejected and sent back to the supplier. This is an ugly situation that costs money, renders valuable shelf space empty, and results in lost sales. 

Additionally, the supplier with the late ASN will be penalized on their scorecard, which in turn opens the door to competitors and reduces the supplier’s sales. 

If you're looking for an EDI vendor, review our checklist to help you select the right solution for your business needs.

There are a lot of other factors by which vendor performance can be quantified over time, and they are driven by rules outlined in vendor agreements. These rules are for the benefit of both parties so that the business activities mesh more smoothly. Rules communicate expectations, e.g: Orders are to be acknowledged within 4 hours, a ship notice should arrive before the shipment, shipment notices must be sent when the truck leaves the facility, and invoices should arrive within 24 hours of the shipment.   

Such specific rules enable a good application to identify when these rules are not being met and generate escalations to the responsible parties at the supplier so that corrective action can be taken before the scorecard is impacted.   

For companies that want to implement a scorecard system of their own, the first step is to set the rules and benchmarks for excellence in the supplier base. The rules can govern everything from timeliness and accuracy, to product quality. 

For example, an organization that requires vendors to perform drop ship activities could look at the time to ship by analyzing the days between sending a PO and receiving the ASN and Proof of Delivery. Analyzing such information helps to determine which vendors are conforming to estimated ship times provided to customers – an important KPI that reflects the consumer’s experience. 

After investing the time and effort into implementing a fully integrated EDI system, gaining this extra insight into the performance of your vendors will be beneficial. A vendor scorecard program makes it possible to proactively manage trends early on and help identify which suppliers are delivering the best value versus least cost.   

Looking for an EDI vendor? We can help. Download our checklist to make this task simpler, and find the right vendor for your needs.

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EDI, ERP

Rube Goldberg machines are pretty coolIf you’re not careful, you could spend hours watching videos of machines which perform simple tasks in no less than twenty steps. Like this gif, where a series of household objects take nearly a minute to turn on a record player. Of course, when it comes to important tasks such as business processes, it’s important to remember Rube Goldberg machines are the fancies of a cartoonist who created them as jokes. 

We’ve worked with companies who inadvertently created a “Rube Goldberg” solution to EDI integration. Most often the solutions are multi-step, multiple application solutions that create multiple points of failure, as is the case with most Rube Goldberg devices. A little research can help avoid those situations, and utilizing a proven solution rather than trying to build one can accelerate business improvement and digital transformation.  

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Look for these attributes to find an EDI solution that does not follow a Rube Goldberg approach… 

  1. It’s a single platform – not a cobbled together group of technologies from various vendors. 
  2. It doesn’t have to be created – its ready to work out of the box. 
  3. It doesn’t require customizations in other applications to work properly. 
  4. It stops bad data from being created that can create downstream problems for stakeholders and customers. 
  5. Top notch service is available when needed to manage issues. 
  6. It can do more than just EDI – it can handle many types of integration that enables a single platform approach for organizations. 

Make sure you get these attributes-- and avoid common pitfalls-- by reading Top 10 Mistakes to Avoid When Selecting an EDI Solution

Some Rube Goldberg machines work, albeit slowly and with a lot of effort. When it comes to mission critical business processes such as EDI and B2B Commerce, simple and reliable is the best way to move organizations forward. 

Data Masons has been delivering EDI Made Simple for 15 years by providing a unique, solution-oriented platform coupled with expert services. Data Masons improves company’s ability to execute business processes more quickly, accurate and at a lower cost – a key objective of Digital Transformation.   

Please enjoy some of the machines other people have made, and if you’re getting dizzy from watching them, make sure you avoid the pitfalls of Rube Goldberg EDI by reading our white paper, Top 10 Mistakes to Avoid When Selecting an EDI Solution. 

Get the "Top 10 Mistakes When   Selecting an EDI Solution" Brief

Exact Software Integration, Dynamics ERP Integration, EDI, ERP

There are compelling reasons why worldwide EDI transaction volume continues to grow. EDI can lower costs, improve accuracy, increase efficiency, improve fulfillment times, etc. However, it is virtually impossible to recognize any of these benefits if EDI transactions are not integrated with an Enterprise Resource Planning (ERP) system. If a company is receiving 1000’s of orders per day electronically, but must key them into their fulfilment system manually, it is unlikely there will be a material benefit to sending and receiving transactions via EDI.

While EDI integration to an ERP is critical, surprisingly, most leading ERP packages do not provide “out of the box” support for EDI. EDI support or integration is typically provided by third parties, or ISV solutions. These third-party solutions have features that make them unique but fundamentally they come in only one of two flavors: embedded or stand-alone. An embedded solution is one in which the ISV has modified the source code, screens, business logic, and database objects of the ERP application to support EDI. A non- embedded or stand-alone solution is one that does not require modifications to the source code or the database objects of the ERP application. The concept is simple, and the differences may seem obvious, however, the ramifications of choosing one approach vs. the other can be significant.

 

Stand-Alone is Less Strain on Your ERP

The Data Masons EDI solution is a stand-alone application. All transaction processing, cross reference checking, mapping, error handling, exception reporting, etc. is managed outside of the ERP. The Data Masons application communicates directly with the ERP application in real time via the ERP’s native integration layer protocols (oData, Data Endpoints, Integration Ports, etc.). This is the ERP companies’ recommended approach, because it removes the resource intensive processing of transactions from the ERP. It also allows the EDI solution to remain decoupled from ERP. This insulates the stand-alone EDI application from any disruptive changes to ERP introduced by customizations or upgrades and conversely protects the ERP application by not requiring code changes or customizations to support EDI integration.shutterstock_84146302_headachecomputer

There is a vast amount of processing and business logic involved in integrating EDI transactions into an ERP system. In addition to reporting, notifications, exception handling, and transaction processing, it is akin to essentially connecting the ERP system of one company to another. Item numbers, ship to locations, customer codes, discount codes, freight providers, etc. all need to be translated or mapped from one system to another. EDI standards facilitate this integration to an extent, but EDI has grown far beyond the traditional ANSI X12 or EDIFACT standards. EDI encompasses ecommerce: cXML, XML, Flat File, X12, EDIFACT, Punch Outs, API’s via https, Amazon Web Services, Blockchain, Web Shopping Carts, etc. Embedding all the functionality required to support ecommerce into to an existing ERP system radically alters the underlying system. It requires significant invasive code changes and customizations to the ERP code base, business logic, and database objects.

Don't get caught in an integration nightmare. Download our paper, 3 Keys to Integration Without Customization, to learn more about avoiding ERP customizations.

Could Embedded EDI Still be Worth It?

ERP customizations are not uncommon, however. Anyone who has implemented an ERP system has experienced the dilemma between altering the ERP to fit a business process vs altering the business process to fit the ERP. In the short term it is tempting to modify the ERP application, especially if it is something minor such as adding a new field or simply changing a label.

However, long term, even simple changes to ERP source code can have long lasting and painful consequences. For this reason, conventional wisdom and ERP vendors caution against significant customizations to ERP. Each change to ERP source code adds to the complexity and cost of supporting and maintaining the system. Customized ERP systems can be a nightmare to upgrade because all customizations must be re-introduced or migrated into the new code base and then all changes must be tested again. This reengineering and regression testing process is at the very least expensive and time consuming and at its worst can be cost prohibitive. It is not uncommon for customers with heavily customized ERP systems to remain on outdated versions indefinitely. This inability to upgrade is a problem for not only the customer but also the ERP vendor.

Embedded EDI is a problem for the customer in that they are not able to take advantage of critical fixes or enhancements that are introduced by the ERP vendor. They are in effect receiving zero return for the support and maintenance fees they are paying for their system if they are not upgrading regularly. It is a problem for the ERP vendor in that they must continue to support outdated systems and technology. They are required to spread their resources across multiple supported versions.

 

Listen to Your ERP Provider

Not surprisingly ERP vendors have taken steps recently to mitigate this problem, particularly within the SaaS ERP solutions. Customers are being strongly discouraged from making any changes to core code, but more importantly customers will no longer be able to remain on a version indefinitely. Microsoft, for example, has implemented a policy of "One version, with all customers on the latest available version". With this policy effective as of January 31, 2019, all users were required to update to a specific version. Going forward there will be twice per year (April and October) mandatory upgrades for all customers using the Microsoft flagship D365 suite of ERP.

Microsoft will disable potentially disruptive new features by default and intends to make the releases backwards compatible to minimize impact to customizations. However, the impact to customers with an embedded EDI solution or a heavily customized ERP will most likely be extensive twice annual regression testing, followed by more code changes and updates to take advantage of new functionality. This will most likely make an embedded EDI solution very difficult and expensive to maintain and why Data Masons promotes the stand-alone approach.

To learn more about how our stand-alone EDI approach can save you time, money, and headaches, read our white paper on EDI and ERP integration without customizations.

Download the "Integration Without Customization:  3 Keys to Automated Integration" Brief