EDI and ERP systems have been at the center of enterprise management for decades. However, until recently, these two technologies existed as stand-alone solutions, with ERP handling records and internal transactions and EDI executing data exchanges with external partners.
Communication between ERP and EDI was mostly manual because achieving any automation required extensive, costly custom coding and data mapping. As a result, many businesses had to contend with significant productivity losses, error risks, and a higher possibility of losing valuable partners.
Thankfully, the enterprise management space has evolved dramatically in recent years. Today, top-shelf EDI solutions can integrate seamlessly with various widely used ERP systems. ERP providers have even begun bundling their offerings with EDI add-ons to form one comprehensive solution.
As an enterprise looking for a seamless EDI ERP integration, you can choose a stand-alone EDI solution with all the tools required to integrate with your ERP or an ERP with built-in EDI capabilities. While both options have their strengths and weaknesses, integrating a stand-alone EDI is the better choice.
Read on to uncover the value of integrating EDI and why a dedicated EDI service beats a bundled EDI ERP solution.
What is EDI ERP integration?
EDI and ERP are two of the most critical systems in enterprise management. ERP is the beating heart of your business and the custodian of all enterprise data. It processes all information, calculates margins and volumes, manages accounts, and tracks supplier performance, among other internal functions.
Meanwhile, EDI handles all aspects of information sharing between your business and external partners, including document translation, validation, and routing. EDI operates on globally set, industry-specific document standards that enable trading partners to send and receive data within their supply chains seamlessly and autonomously, regardless of their internal systems.
Healthy supply chain operations heavily depend on how well EDI and ERP systems communicate. EDI ERP integration is the process that enables data to flow automatically between the front-end EDI application and the back-end ERP system.
Automating the translation and transmission processes between EDI and ERP eliminates the need for manually re-keying orders, invoices, or messages, drastically improving speed and efficiency and minimizing errors.
The Value of Integrating EDI with ERP
EDI ERP integration is a top priority in the supply chain world. As the COVID-19 pandemic continues to disrupt the flow of commodities globally, businesses have realized the criticality of ensuring seamless communication among themselves.
By integrating EDI with ERP, your enterprise can achieve the overall resilience required to wade through current and future supply chain upheavals.
Here are some key benefits of EDI integration with ERP.
- End-to-end Process Automation
Integrating EDI with ERP automates the flow of information across your enterprise systems. Cross-functional transactions like bills of material, purchase orders, receipts, and invoices can be transmitted with little to no human intervention, enhancing speed and accuracy.
- Greater Supply Chain Flexibility
EDI ERP integration opens your business up to a wider pool of partners. You can transact with companies that use different ERP systems and comfortably choose the suppliers and third-party service providers offering the optimum combination of price and efficiency.
- Reinforced Data Security And Privacy
Integrating EDI with ERP automates information transfer between the two systems, eliminating the need to pass data around in files that can be easily tampered with or lost. You can also set customized permissions that restrict data to relevant users.
- Effective Analytics
Integrating EDI with ERP creates uniformity in enterprise data, streamlining analytical processes like capacity planning, inventory management, and financial reporting. As a result, you can make more informed decisions and improve your bottom line.
Why avoid using ERP "plug-in" EDI Modules?
ERP with built-in EDI is an increasingly popular entryway into EDI ERP integration, especially among small and medium-sized enterprises. However, this option has several decisive limitations, as you will learn below.
- Costly Integration Delays
A key benefit of separating EDI and ERP is deploying system changes seamlessly. A suitable EDI provider can set up new partner connections on a stand-along EDI solution within hours without affecting system integration with ERP.
Bundled EDI ERP packages often fail to offer the same level of efficiency when connecting new partners, primarily because ERP providers tend to prioritize their main product over add-ons like EDI.
Your trading partners cannot afford to wait around while you set them up on your system and will likely move on to a more agile enterprise. Choosing a dedicated EDI solution from a specialized EDI vendor will guarantee timely updates and faster onboarding, translating into robust partner relations.
- ERP Limitations
ERP systems are inherently designed as data repositories and are rarely optimized for EDI transactions. Even a premium-grade ERP application may lack the EDI routing and translation features necessary for maximum operational efficiency. Therefore, choosing a bundled EDI ERP solution may limit your ability to react quickly to changing standards and customer expectations.
In many cases, working around the rigid EDI add-on requires custom coding to achieve the desired result. Besides the unplanned cost, these additional configurations can increase integration complexity and the risk of system failure.
- Limited Integration With Other Enterprise Platforms
Although most of a company's EDI data flows through the ERP, other applications, such as TMS, WMS, CRM, and eCommerce channels, also need to communicate with EDI.
A bundled EDI ERP solution may work well with the ERP but fail to blend with the other enterprise systems in your firm. You could even be forced to work around the EDI service with manual intervention or implement expensive custom integrations that can undermine system affordability and reliability.
Modern-day EDI Solutions Can Seamlessly Integrate With ERP Systems
EDI vendors understand the importance of a seamless EDI ERP interaction and continuously refine their platforms to improve this connection. Top EDI solutions can accommodate various ERP systems and upgrades, whether on-premises or cloud-based. Moreover, leading EDI providers can set up EDI ERP integration quickly and cost-effectively, significantly shortening the ROI realization period.
Therefore, the cost and complexity of integrating EDI with ERP is no longer a worthy excuse for choosing a built-in solution, especially given the benefits of a separate EDI platform. Instead, choose a dedicated EDI service that can work well with your current ERP and other enterprise systems while also giving you the flexibility to deploy future upgrades and onboard new partners with ease.
Integrate EDI and ERP with Remedi
Visibility, control, and interoperability are necessities in modern-day supply chains. Therefore, robust EDI ERP integration is no longer a luxury but a business requirement. The best way to ensure successful EDI ERP integration is by choosing a dedicated EDI service that can seamlessly integrate with your ERP and other enterprise systems.
Remedi has a long history of helping enterprises improve operational efficiency through robust EDI deployment and integration. Make the first step toward optimizing EDI ERP integration by contacting REMEDI today.