How EDI Adds Value to Supply Chain Operations

In today’s technological world, one small element can make a drastic difference. A decimal point on an invoice makes $.50000 into $500.00…a slip of the finger can result in the purchase of unwanted goods or an error that requires additional time and resources to correct. A misprint on a label can cause a lengthy detour on a package route. Data entry mistakes can lead to discrepancies, disrupting the supply chain and resulting in costly situations. These inaccuracies not only affect the immediate bottom line but can also strain relationships with trading partners and impact financial stability.

Electronic Data Interchange (EDI) eliminates the human component of error by automating processes that would otherwise be subject to simple slips or mistakes. These costly issues affect businesses and can interfere with the optimized flow of supply chain operations. The Data Warehousing Institute estimates that bad, inaccurate, dirty, or missing data costs companies more than $600 billion a year. In recent years, supply chain disruptions made regular headlines, amounting to a $228 million loss in the United States alone. Integrating EDI in the supply chain allows businesses to optimize processes and save valuable resources. Here are just a few of the ways EDI can help add value to your supply chain operations:

Increased Automation

Automation processes free up your team so they can focus on more important tasks and reduce manual data entry. Rather than triple-checking decimal places, they can devote their time to helping business thrive. Automation saves money twofold: with fewer hours required from employees, your business saves money on labor costs, and with the reduced need for paper products to perform and document the same processes, your business lowers the costs of materials. As a bonus, automating supply chain processes can reduce order processing times by up to 50% when compared to traditional systems. What once required multiple copies of physical documents is now made digital through EDI, creating less waste, aligning with sustainability practices, and ensuring the entire operation runs more efficiently.

Learn about automating order and billing processes with EDI

Improved Visibility

Data entry mistakes take less than a second to make and their discovery can take days, weeks, or even months. At any level in the supply chain, your focus could instantly shift to putting out fires while all other services are put on hold. Up-to-date information is key to making informed business decisions or for analyzing strategic efforts.

EDI helps bring data exchange into real-time, allowing businesses to receive updates and take action faster than before. Issues that could have previously gone under the radar are quickly escalated and resolved. With accurate information regarding inventory, payment statuses, and shipping schedules, lead times are greatly reduced, allowing businesses to better provide accurate estimates to their partners and end customers. Ultimately, improved visibility is beneficial for overall experience and trust in a business.

Maximized Efficiency

For any supply chain operation, efficiency is key. EDI helps automate manual processes, improves visibility for the supply chain, and minimizes errors, improving the overall workflow of operations. This process improvement helps businesses perform efficiently and keep the focus where it belongs: on providing reliable, consistent service to their customers. 

EDI implementation reduces errors, lowers overall costs, and creates faster processing times, increasing businesses agility, efficiency, and competitiveness. For buying organizations, EDI solutions designed to maximize efficiency and reduce the cost and complexity of maintaining in-house EDI operations, allow them to shift their focus to what their business does best. Similarly, solutions for suppliers can reduce the cost of time-consuming, expensive mistakes that pose a risk at each manual step, making their order and billing processes more efficient so they can meet the needs of their customers.

Increased Supply Chain Efficiencies with Edict Systems

Many processes in business are acceptable, but far from perfect. EDI helps reduce the costly, time- consuming errors in supply chain operations so businesses can become more efficient and reliable. Implementing EDI and automation into day-to-day operations helps businesses improve visibility and efficiency so they remain competitive, strategic, and aligned with their goals. By replacing manual efforts throughout the supply chain, EDI helps solve problems, aids in compliance, and makes data exchange easier.

With over 35 years of EDI expertise, we help both buying organizations and suppliers lower costs, connect to their trading partners, and streamline their business processes. If you are interested in discussing how Edict Systems’ EDI solutions can help improve efficiencies in your supply chain, contact our experts.