ELECTRONIC DATA INTERCHANGE (EDI)

Electronic data exchange (EDI) is a method for exchanging data in a standardized format between systems. By facilitating the transfer of documents such as orders, invoices, warehouse receipts, shipments and transport documents, EDI supports collaboration between business partners.

More efficient and productive collaboration

Successful collaboration between business partners depends largely on fast and reliable communication involving the exchange of documents and data. However, different systems and formats partner companies use to store, generate and process data can slow down communication.

The purpose of EDI is to remove any obstacles in B2B collaboration by adopting a common format for data exchange and eliminate human impact. This means that data generated within any of the systems is automatically uploaded into a standardized data format which can be processed by any partner company.

EDI can be also used to support B2C activities, providing information to customers who do not work with any system.

The open architecture of Microsoft Dynamics NAV enables the implementation of EDI. By adding the functionality, data generated within an ERP system or another business solution can be easily retrieved into defined file formats and uploaded from files sent from the outside.

CONNECTING BUSINESS PARTNERS

EDI is a solution that can be implemented in any type of business. However, it is gaining the greatest popularity among retail and manufacturing companies as the exchange of information with their partners, vendors and customers is critical for their business. Such companies usually use EDI within their supply chains (automated ordering) or retail chains (communicating prices). By defining EDI as a communication method, such companies can receive information they need faster and substantially reduce their response times. Orders, invoices, credit memos, price lists etc. sent in the same format are no longer reasons for delays and errors. Data is no longer entered multiple times.

The EDI technology increases process efficiency and eliminates risks in document exchanges. The use of a standard format, enables easier transaction tracking and error detection. This results in reduced costs and order lead times.

By implementing EDI, companies improve the availability of logistic information, enhance their data repositories by collecting more specific data, and eliminate data inconsistencies and duplicates. As a result, they can reduce the time consumption of communication processes.

Implementing the solutions means developing an interface which will connect the IT systems involved. Files in the format required for EDI can be sent using any medium that is used by all stakeholders. They can be transmitted using a modem with FTP and HTTP.

How does EDI work in Practice?

Purchases

Exporting purchase orders

  • Vendors tagged for EDI
  • The XML file can be exported directly from the purchase order form.

Importing purchase orders

  • Vendors tagged for EDI
  • Purchase invoice data can be uploaded from a vendor XML file

Operation log

  • Tools for logging EDI exports and imports
  • Data required to identify import or export operations are logged e.g.: import date, file path and file name, document no, document type, user ID, etc.

Customisable setup

  • Possibility to define custom export and import setup for purchase documents, e.g.: export and import file paths, ILN no., EAN no., XML versions.
  • The setup can be customised for each vendor tagged as EDI.
  • EDI can be blocked temporarily blocked for specific vendors.

Generating EAN codes

  • The functionality can be used to generate EAN codes for a defined range.

Importing purchase invoices

  • Vendor tagged for EDI
  • Purchase credit note data can be retrieved from a vendor XML file
  • Data can be automatically validated, including item availability validation
  • This functionality can be used to create a purchase credit note automatically in the system

Importing purchase credit memos

  • Vendors tagged for ED.
  • Purchase credit note data can be retrieved from a vendor XML file.
  • Data can be automatically validated, including item availability validation.
  • This functionality can be used to create a purchase credit note automatically in the system.

Exporting a confirmed sales delivery advice

  • In the posted receipt, you can compare the delivery advice quantity and actually received quantity.
  • Based on the comparison of delivery advice and actual delivery quantities, the system exports a delivery confirmation.

Archiving EDI documents.

  • The functionality enables you to log and store data from all imported or exported documents using EDI

Sales

Importing sales orders

  • The functionality enables you to retrieve XML files containing a customer’s order.
  • Data can be automatically validated, including item availability
  • The functionality creates automatically sales orders in the system.

EDI sales report

  • This report can be used to print exported sales invoices and sales credit memos.
  • The report can be printed for selected customers, periods and document types.

Importing a confirmed sales delivery advice

  • It is possible to import the confirmation of the exported advice from the XML file.
  • On the posted shipment, you can compare the shipped quantity and confirmed received quantity.

Archiving EDI documents

  • The functionality enables you to log and store data from all imported or exported documents using EDI.

Exporting posted sales invoices

  • Using this functionality, you can tag customers for EDI.
  • Then, each posted invoice issued for the customer and tagged as EDI can be exported in an XML file.
  • You can export single or multiple documents.

Exporting sales shipment advices

  • Using this functionality, you can tag customers for EDI.
  • Each posted invoice issued for the customer and tagged as EDI can be exported in an XML file

Operation log

  • The functionality provides tools for logging EDI exports and imports
  • Data required to identify import or export operations are logged e.g.: import date, file path and file name, document no, document type, user ID, etc.

Customisable setup

  • It is possible to define custom export and import setup for sales documents, e.g.: export and import file paths, ILN no., EAN no., XML versions.
  • The setup can be customized for each customer tagged as EDI.
  • EDI can be temporarily blocked for specific customers.

Benefits

Less errors in documents

The possibility to verify each document against formal and accounting rules contributes to the reduced number of errors in documents processed using EDI.

Automated document and data entry

Documents are automatically imported to the recipient’s system. Therefore, there is no need to enter them manually.

Shorter order lead times

Standardized communication and a common data format used in the communication between business partners reduces the time needed to complete the order.

Standardized data

For the purpose of more streamlined communication, business partners use uniform data standards which ensures consistency and transparency of all document and messages.

Shorter settlement of financial transactions

EDI reduces order lead times by enabling direct document transfer (orders, VAT invoices and credit memos). This means that financial transactions are processed and applied much faster.

Efficient logistic chain

The quality of data exchange is critical issue in logistics. EDI ensures that all information is transferred fast, thus streamlining the flow of logistic processes.

Reduced costs

More productive communication, a reduced number of errors and less paper work at order processing enable you to curb your cost in all B2B related areas including sales, business partner service and logistics management costs.

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