EDI Questions and Answers
- How can I implement EDI when I don't understand it?
- EDI costs too much; how can I justify the cost when the other guy gets all the benefits?
- How can I get along without paper?
- Won't EDI destroy my relationship with my buyer/seller?
- How often do I have to update software? Why?
- Won't EDI give others access to our proprietary data?
- Where can I get more information?
How can I implement EDI when I don't understand it?
While implementing EDI is not a simple task, EDI is not technically complex. There are a number of ways to learn about EDI, including: periodicals, commercially available training programs, EDI conferences and trade shows, software and network suppliers, and the experience of companies already participating in EDI.
EDI costs too much; how can I justify the cost when the other guy gets all the benefits?
Hardware costs often are mentioned as a major barrier to implementation of EDI, followed closely by software development. Almost all organizations already have the necessary hardware to perform EDI. While software costs can be substantial in a full-blown implementation of EDI, off-the-shelf software packages can be purchased for many EDI applications, with only minimal in-house development required.
Concerning who benefits most from EDI, human nature being what it is, potential EDI users often believe that the benefits of EDI are unevenly split between trading partners, with their own organization on the short end of the agreement. The truth is, without benefits for both partners, EDI would have long since faded from the business landscape.
How can I get along without paper?
Paper has been around for hundreds of years. We're used to it. Like an old friend, we don't want to give it up. But while a fully deployed program of EDI can eliminate paper, it doesn't eliminate the information that was on the paper. And the information is what we really need. For those times when paper is absolutely necessary, a paper copy of any EDI transaction can be produced. Eventually most people will become comfortable with a paperless process.
Won't EDI destroy my relationship with my buyer/seller?
Buyers have expressed concern that EDI will reduce the number of contacts between buyer and seller and will thus make the relationship more impersonal. Salespeople also have expressed a fear that EDI will weaken buyer-seller ties. EDI does change relationships between trading partners. However, because of the cooperation required to implement and maintain EDI, the changes tend to reflect a movement away from an adversarial relationship to one based on cooperation, thereby strengthening ties rather than destroying them.
How often do I have to update software? Why?
The Rail Industry Guidelines are updated each year upon publication of the ASC X12 version/release. Trading partners within the rail industry are expected to upgrade to one of the two most current version/releases on a schedule agreed to by the railroads.
In most cases the upgrade process is simple; in some cases the upgrade may take some work. The annual upgrade restricts the number of version/releases that each trading partner must handle at one time. Furthermore, Union Pacific supports the upgrade schedule as part of its commitment to continuous improvement.
Each version/release of the national standards is more precise and contains additional capability. Each publication of the Rail Industry Guidelines corrects problems encountered in actual operation and provides for a richer exchange of information. The annual upgrade process assures that the advantages of the new standards and guidelines are incorporated into the business at a consistent rate.
Won't EDI give others access to our proprietary data?
No. Unless security is breached along the way, a sender's message goes to the receiver without being "read" by anyone else. EDI does not provide direct access to internal files. By using a VAN, a company can have all messages sent to the VAN mailbox, eliminating direct computer-to-computer contact between sender and receiver. The use of authorization codes and passwords also can limit the activity performed by any outside party.
How can I convince my lawyers and auditors to go along with EDI?
Both the auditing and legal professions have addressed EDI; both are represented at the ASC X12 as national standards are set. The issues that may arise in these areas are manageable, with proper planning. Trading Partner Agreements specify the legal conditions for paperless transactions, and EDI auditability is ensured by developing EDI systems with built-in controls for proper transaction handling. Success in overcoming the objections of lawyers and auditors can be achieved by involving them in the planning stages of EDI implementation.
Where can I get more information?
The Data Interchange Standards Association (DISA) operates as the secretariat for ASC X12 organization and acts as an educational resource for EDI.
Many of the EDI software suppliers and VANs have established an Internet presence, and can be found by using your preferred search engine on the Web. Additionally, there are numerous books and periodicals available on the subject of EDI. To order the X12 standards or Rail Industry Guidelines, contact the Washington Publishing Company.