“Value-added networks provide competitive advantage.”

On the surface, this statement seems to make sense of the eternal value-added network (VAN) claim that the advantage of their network is their network. While stated as fact, “the advantage of the network is the network” is only relatively true, depending on who you’re connecting with and whether the network is where you can find your trading partners (or at least some of them). What does that mean for the rest of your trading partners?

This argument for the VAN being a competitive advantage begins to unravel when you look more closely at trade among trading partners. You’ll arrive at the conclusion that a single network or VAN can’t possibly serve all of a company’s needs.

Read more: VAN independence: So, how does a trading partner break from their VAN?

Begin at the end

The advantage of EDI technologies is connecting with your trading partners… and not just some of them. The ability to connect to most or all of them offers the greatest ROI.

However, the complexity of EDI and related technologies presents compatibility challenges. There are many EDI standards, formats, and transactions. There’s X12, UN/EDIFACT, and GS1 XML trade messages. There are also non-EDI formats like JSON, flat files, text files, and proprietary XML message formats. Let’s not forget about the myriad of communication methodologies such as AS2, MFTP, FTP, SFTP and APIs, or the number of transactions and variants.

Clearly, not everyone you need to connect with will be on the same network or VAN. That’s why a VAN must have an interconnect.

What’s an interconnect?

An interconnect is a tool that VANs use to communicate with other VANs. It aids in the exchange of EDI transaction documents belonging to individual clients. All VANs use interconnects to ensure delivery of transaction documents among the participants within various VANs. This begins to demonstrate the point of a VAN: connecting with more networks provides a bigger advantage.

Why haven’t I heard about interconnects before?

The real value of interconnects to VANs was that they help keep new VANs out of the market. Discussing interconnects dispels the notion that belonging to a VAN is an advantage. That’s why VANs don’t like to talk about them. If they did, they’d also have to talk about the characteristics of EDI, which reduces VAN confusion within the consumer.

The three-part harmony

For EDI to be effective, it needs three layers: transportation, transformation, and integration. In the marketplace, these layers are typically seen bundled together as what has come to be known as the “VAN solution”. However, they should be viewed as separate solutions that work together in harmony to produce the desired results.

A classic example of this harmony can be found in your pocket: your mobile phone. One company produces your device, another delivers your cellular service, and a third provides the local and long-distance lines that you connect to when speaking with someone on a landline.

The three essential components of EDI are:

1.    Transportation

The transportation layer allows partners to talk to one another. While VANs are dominant in this space, several successful methodologies like AS2, MFTP, FTP, SFTP and APIs also exist; most have been in use for over 20 years. In fact, your VAN may use FTP to connect to your VAN mailbox; I encourage you to ask your EDI representative.

2.    Transformation

The second component is the transformation layer. This is where the translation between EDI formats takes place. X12, UN/EDIFACT, GS1 XML trade messages, JSON, flat files, text files, or proprietary XML messages are transformed into a format that your ERP system can consume.

3.    Integration

Lastly there’s the integration layer: the path into the enterprise system where the transformed message is consumed. It can be a connector (like ODBC or ODATA) or an API. The primary focus is a path for the order to take without manual intervention.

So more connections are better?

Yes! If belonging to a network is a strategic advantage, then access to multiple networks is even more of a strategic advantage. It’s actually not so much about the number of networks as it is about the availability of connections to your trading partner and choice of those connection methods. VANs typically involve monthly subscription costs and transaction fees (or kilo-character fees), whereas in most cases, methodologies like AS2, MFTP, FTP, SFTP, and APIs have no monthly costs directly associated with them.

What’s AS2?

Applicability Statement 2 (AS2) is a protocol used to transport data securely and reliably over the Internet. It provides document receipt and tracking without the need for a VAN or interconnect. In short, AS2 provides a direct connection with a trading partner.

AS2 makes use of the Internet as a payload-agnostic mechanism for delivery of EDI transaction documents, reducing potential points of failure. More importantly, it eliminates transaction-based charges that occur with the exchange of EDI transaction documents through a VAN connection.

PartnerLink and AS2

Visionet’s PartnerLink solution is different. PartnerLink isn’t a VAN; it’s a highly scalable, reliable, and configurable EDI and B2B interchange solution that integrates natively with Microsoft Dynamics 365 for Finance and Operations. It also supports integration with most other ERP systems. PartnerLink includes an AS2 solution and connects to all of the major VANs, making it the perfect tool for B2B communication with both EDI and non-EDI trading partners.

What about APIs?

PartnerLink also provides built-in support for API based eCommerce platforms like Shopify, Magento, and many others, allowing companies to shift seamlessly between EDI and API-based integrations. This makes PartnerLink a complete EDI, B2B, and API solution for frictionless partner communication.

…and nonstandard transactions?

PartnerLink enables communication with non-EDI organizations, too. It supports a wide range of EDI formats like X12, UN/EDIFACT, GS1 XML trade messages, non-EDI formats like XML and JSON, and custom formats to ensure reliable and secure communication with any trading partner organization.

What’s the lesson here?

“VANs provide competitive advantage” is only true when there’s no advantage found in access to multiple networks.

• EDI solutions should provide more than one communication channel for exchanging documents with trading partners, including VAN, AS2, SFTP, FTP, and MFT.
• EDI solutions should provide a transformation component – a mechanism for handling a range of EDI formats.
• EDI solutions should provide a clear integration path into your enterprise system that doesn’t require manual intervention or ongoing maintenance.

VAN Independence: How Does a Trading Partner Break from Its VAN?

What’s Your VAN Independence Strategy?

Independence Day is now behind us and summer is nearing its end. The 4th of July holiday encourages reflections, reflections that include independence and country. It also includes independence in financial, personal, and business matters. Returning to work following the mid-summer holiday this year, I began to think about systemic independence – specifically the independence of trading partners who are more willing than ever to declare themselves independent from their VAN.

A value-added network (VAN) is a private network used by a company to facilitate and ensure the exchange of EDI transaction documents with one or more trading partners.

Communication

Traditional EDI includes costs of configuration, transformation, integration, and communication. EDI communication typically includes the use of a VAN. EDI requires a mechanism that allows trading partners to send and receive messages. While there are other methods, the VAN is the most conventional one.

There are many such VANs available, typically through subscriptions. These VANs communicate with members as well as among each other, allowing VAN subscribers to communicate with one another regardless of the community to which they belong.

Foundation

The original VANs were much more than what service-based organizations associated with a transport mechanism. Many began their lives as services associated with “computing time” back when computers were rare and the needs for computing were greater. Companies like IBM set up massive communication channels using the IBM Systems Network Architecture (SNA) to facilitate the use of mainframe computers; such interactions and transaction exchanges were subsequently moved to smaller and smaller machines using File Transfer Protocol (FTP).
 

Domination

Once in place, VANs began reducing the services they provided. No longer providing computing services, they set their sights on becoming massive communication channels. They set up their own independent communications networks, complete with “mailboxes” and “interconnects”. The mailbox was an address on a VAN used by a trading partner to pick up and drop off transaction documents. On the other hand, the interconnect was a tool used by VANs to communicate with other independent VANs to help delivery and exchange of transaction documents.

Substitution

Once in place, VANs began reducing the services they provided. No longer providing computing services, they set their sights on becoming massive communication channels. They set up their own independent communications networks, complete with “mailboxes” and “interconnects”. The mailbox was an address on a VAN used by a trading partner to pick up and drop off transaction documents. On the other hand, the interconnect was a tool used by VANs to communicate with other independent VANs to help delivery and exchange of transaction documents.

So why aren’t more companies moving to AS2? It may be because no one has explained the benefits in a way that makes a comparison easy.

Explanation

AS2 securely moves more data at a lower cost by relying on Internet access rather than a dedicated network. The VAN’s monthly access fees and kilo-character costs disappear.

AS2 relies on software and the Internet to accomplish the same tasks that were once only found in the domain of VANs.
 

Erosion

Market consolidation of EDI products and services has recently seen a consolidation of VANs, with many of the impacted customers moving toward AS2. Considering the growth rates we saw in the use of “free email” in the browser wars of the 1990s, industry experts agree that AS2 is likely to become more like FTP in its frequency of use.

What’s the Lesson?

EDI buyers will look for an EDI solution that:

• Offers independence from the VAN, can leverage any type or number of independent connections, and is in tune with today’s market
• Has a willingness to go that extra mile for their business
• Provides improved service offerings at a fixed cost and includes everything they need to make it work
• Integrates directly with their ERP, works without manual intervention, and helps them be more efficient.

Questions to Ask Your Client

• Are you happy with your current EDI solution?
• Is your EDI solution integrated or does it require manual intervention like logging into a portal, uploading spreadsheets, or running a batch process to make it work?
• Are you using multiple solutions to communicate with your trading partners?
• How would you like to break from these dependencies?
• Would you be interested in hearing about a frictionless EDI solution?

Businesses turn to EDI solutions because EDI has proven to improve business efficiency and reduce costs. Compared to manual business processes, EDI helps reduce costs and inefficiencies up to 35%.

Businesses from Amazon to Zappos use EDI to take advantage of these benefits. In 2018, annual EDI transactions numbered over 20 billion. Combining EDI solutions with real-time APIs enhances partner communication even further, particularly for omnichannel operations with a large number of daily transactions.

In this blog post, we’ll talk about how implementing an EDI solution can streamline your business operations.

Procurement

EDI was initially used in the procurement process to simplify paperwork. The procurement process involves four major documentation stages: purchase order generation, purchase order acknowledgement, making changes in the purchase order, and acknowledging those changes.

Traditionally, these processes were done by posting mail (or sending an email) to the recipient manually. Using EDI, these processes are automated. Retailers can send their suppliers an electronic purchase order and their suppliers can then respond with a confirmation record within seconds. Changes in purchase orders can be made and confirmed quickly, easily, and often without human intervention. Buyers and sellers alike can expect several immediate improvements with the right EDI strategy:

• Faster procure-to-pay
• Quick and accurate purchase order delivery
• Fewer time-consuming and labor-intensive processes like responding to email
• Improved buy-side agility and improvements in fulfillment rates

Supply Chain

EDI vastly improves supply chain operations. Supply chain processes typically include an advance ship notice (ASN). Also known as an 856 or Ship Notice/Manifest, the structure of the message enables the transfer of information from seller to buyer at the shipment, order, pallet, pack, and item levels, providing the receiver information necessary to schedule shipment receipt and storage.
 

The ASN also accommodates common data elements used for business, including global trade item number (GTIN, i.e. the numerical representation of the barcode) and traceability elements like serial number, batch and lot numbers, expiration, packaging, and production. Relating harvest and use-by dates with these data elements at the shipment, order, pallet, pack, and item levels can help ensure consumer safety and reduce counterfeit goods.

EDI documents like the Transportation Carrier Shipment Status Message (214) and the Motor Carrier Package Status Message (240) from package delivery companies, couriers, logistics companies, and carriers enhance trading partners’ ability to track goods.

EDI is there when shipments arrive at the warehouse or on the consumer’s doorstep. The barcodes on the cartons can be scanned and data delivered by way of the ASN can be used to automatically update inventories, send confirmations and invoices, and if the shipments are somehow delayed, relevant personnel can be alerted immediately to address any concerns.

Automating the exchange of data through an EDI solution across the supply chain improves:

• The timing of orders, shipments, deliveries, and invoices
• Cross-docking, direct store delivery (DSD), and direct-to-consumer (D2C) delivery
• Product traceability and shipment tracking

Read more: Improving your supply chain efficiency with ERP-integrated EDI

Invoicing

Businesses are always looking to improve business efficiency and reduce costs. Many are also concerned about the environment. Within the United States, some federal agencies have made e-invoices compulsory to reduce paper usage. Many countries have taken environmental and other concerns even further with countries including Spain, Brazil, Italy, and Mexico mandating the use of electronic invoices.

EDI solutions have a long record of success in improving communication and reducing fraud. Companies employing EDI solutions have also been able to save costs in paper, processing, postage, and invoice storage, furthering their operational goals of improving efficiency and reducing costs. Real-time access to electronic invoices and other business documents helps trading partners eliminate manual tasks commonly associated with paper-based process while improving days sales outstanding (DSO) and reducing payment penalties.

Conclusion

A properly designed, implemented, and integrated EDI solution offers businesses many significant advantages:

• Improved decision-making
• Improved business efficiency
• Improved environmental and regulatory compliance
• Improved cash management
• Reduced paper, processing, postage, and storage fees

EDI-enabled companies are better prepared to focus on their customers without increasing overhead or administrative tasks. To learn more about how your business can migrate from a labor-intensive, paper-based business process to a modern EDI solution for your business, contact PartnerLinQ.

In an environment of ever-changing consumer demand, your retail or manufacturing business needs to leverage every competitive advantage it has at its disposal. Modern global businesses rely on electronic data interchange (EDI) solutions to maximize operational efficiency and maintain market competitiveness.

Businesses use EDI technology to innovate on operational strategy, enhance supply chain management, and improve operational performance. Most large manufacturers and retailers coordinate their operations via EDI, from sending and receiving purchase orders and invoices to advance ship notices (ASNs) and product transfer reports.

So becoming an EDI-capable organization signals to potential trading partners that you are a trustworthy party that uses standards-based supply chain practices, and helps you unlock the door to global trade. However, EDI’s primary advantage lies in the vast improvements in operational efficiency it offers over paper-based processes.

Even though EDI promotes uniformity through the use of communication standards, not all EDI solutions are created equal. Many older EDI systems only use one EDI format and don’t support any modern, non-EDI communication standards. Many of these legacy systems (and even some newer “web EDI” solutions) require users to manually key in information, and may even require them to manually initiate and end the EDI transfer!

Advantages of EDI ERP Integration on a Modern Supply Chain Connectivity Solution

These methods, while better than using paper documents and a courier service, are ancient relics from the 20th century. If your organization still uses this kind of software, you should make it a priority to have it replaced with a supply chain connectivity solution that integrates directly with your ERP software. Here are three ways that an ERP-integrated EDI solution significantly improves efficiency:

Minimal Manual Entry

Direct EDI ERP integration means that you’ll hardly ever need to manually type information to send it to a vendor (or type received information back into your ERP system).

Since all information on your products, pricing, inventory, sales transactions, customers, and deliveries are already stored in your ERP system, you’ll usually be able to select the information you want to send with a few clicks. Then, depending on your operating procedures, you can either transmit that information to the appropriate trading partner right away or add it to a scheduled batch transfer.

More advanced EDI solutions will also confirm that the ERP information that you’re about to send complies with your trading partners’ internal policies for those specific document types. This is definitely much quicker and more convenient than consulting a separate compliance checklist for each vendor every time you transmit information.

By reducing its dependence on manual entry, your organization will spend less time managing information transfers, correcting transcription errors, and running damage control due to the errors you failed to catch in time. You’ll also improve supplier relationships and save a surprising amount of money on EDI chargebacks caused by noncompliant information transfers.

Rapid Partner Onboarding

A well-designed supply chain connectivity solution also improves efficiency by speeding up the onboarding of new trading partners. Instead of requiring days of configuration, modern EDI systems use intelligent field-mapping techniques to automatically reconcile your partners’ data and document formats with your own. The sooner you complete the onboarding process, the sooner you experience the benefits of a digital supply chain connectivity solution.

Agile Decision-Making

A seamless EDI ERP integration also allows you to start using advanced, ERP-integrated analytics tools to gain a better understanding of your trading partners. In the same way that your ERP system’s dynamic dashboards and advanced reporting capabilities provide actionable insights about your organization’s internal processes, they will also begin providing clear, easy-to-understand intelligence on how each of your vendors is performing.

Now you can anticipate and adapt to supply-side changes more quickly. Decision-makers will have access to the information they need to respond to emerging opportunities and challenges in real time.

Industry-leading EDI solution providers like PartnerLinQ provide end-to-end ERP-integrated solutions that drive efficiency by minimizing manual entry, expediting partner onboarding, and enhancing decision-making agility. Contact Us to request a demo.

The success of your business is inextricably linked to the performance of your supply chain. Even intermittent hiccups in replenishment schedules or minor inaccuracies in demand forecasting can quickly become sources of uncertainty, fulfillment delays, and major business risk. Keeping in constant contact with your suppliers and other vendors is the simplest way to avoid these issues.

However, exchanging complex business requirements and important documents comes with challenges of its own. Here are a few supply chain communication issues that retailers commonly experience, and ways that dedicated digital solutions address these challenges.

Poor Document Management

Many businesses rely heavily on email for a wide range of day-to-day business processes, including coordinating orders and invoices with their suppliers. While email is far more convenient than phone calls and conventional mail, it’s still a very inefficient and error-prone way to conduct business.

Imagine creating a purchase order as a PDF and sending it to your supplier via email, only to realize that you forgot to attach the actual PO document! Or how about those times when you spend precious minutes hunting for the right invoice or PO through hundreds of emails? Maybe you saved the email attachments to a separate folder on your computer, and you’re not sure which file is the most recent version. Maybe you need to find out how many POs you sent to each of your suppliers this week… When you’re working against the clock to fulfill orders on time, these aren’t the sort of details you should be spending your time on.

Specialized digital solutions for communicating with trading partners and suppliers is much faster and more convenient than email. Instead of preparing a paper document, scanning it, attaching it to an email and sending the email to the right address, you can send the same information from your organization’s ERP system directly to your supplier or partner’s ERP system. This kind of partner integration provides fewer opportunities for manual error, and takes far less time and effort.

Incompatible Partner Standards

Dozens of data formats and data transport protocols exist, so it shouldn’t surprise you to discover that your suppliers use different standards than you do. Some use XML while others use JSON. Some might even use their own proprietary formats.

It isn’t just data formats that differ from partner to partner. Each organization has its own set of business rules that it applies to each type of document the send or receive, or even to specific segments or fields in a document. Fail to comply with these rules and you might be asked to prepare and send those documents again eliminate the complexity caused by mismatched standards by intelligently translating between different standards and keeping track of each vendor’s unique set of business rules. These features are especially useful when you need to onboard a new trading partner quickly.

Scalability

If your company only sends fifteen or twenty business documents a day, email might actually be a workable solution for vendor communication. However, as soon as your business grows and you begin to send fifty to a hundred documents each day, relying on email will cripple your operations. Put simply, email fails to scale.

Modern organizations need to plan ahead and choose communication systems that can support peak transactional workloads, even if their business growth exceeds all expectations. Modern partner communication solutions are designed to process thousands of transactions an hour without any noticeable slowdowns. If your communication infrastructure becomes sluggish under high workloads, your efficiency will suffer, and so will your bottom line.

Each of the pain points mentioned above can wreak havoc on your ability to align inventory with demand and efficiently fulfill orders, and ultimately result in business risk, lower margins, or even loss of business. A scalable supply chain communication solution that integrates with your organization’s ERP platform is a worthwhile investment, and if you don’t have a modern system in place already, now is the time to explore your options.

PartnerLinQ is an innovative, process-centric B2B integration solution that enables progressive organizations to build their digital partner extensible platform leveraging APIs and robust EDI capabilities.

With PartnerlinQ, organizations in most industries including fulfillment (3PL), retail, Ecommerce, wholesale, and distribution can achieve operational efficiencies through streamlined B2B communication and real-time visibility. PartnerlinQ brings management of all forms of B2B interchange including EDI, real time APIs, and file based/proprietary formats into a cohesive solution which is easy to use and manage.

PartnerlinQ requires zero customization to Dynamics 365 for Operations and Dynamics AX 2012 to make your ERP EDI ready.

PartnerLinQ Features and Benefits:

• Designed for ease of use in managing EDI
• Rapid partner on boarding based on hundreds of preconfigured EDI transaction and partner mappings
• Powerful and configurable business rule engine for automating document exchange
• Driven by business processes, beyond traditional point-to-point EDI interchange
• Supports APIs for Shopify, BigCommerce, Magento, Jet, Amazon, DHL, UPS, and others.
• Unified management and workflow of all B2B communication channels
• Centralized B2B communication through a scalable and reliable solution
• Supports small package shipment and tracking
• Responsive solution that identifies and reports issues before they put business relationships at risk
• Highly scalable – Cutting edge, server-class architecture on Azure platform that scales to handle extreme seasonal spikes
• Browser based access, built-in reporting and notification capabilities

The PartnerLinQ solution is a fully managed cloud solution with complete EDI/B2B management professional services. PartnerLinQ is also available as licensed solution managed entirely by the customer. For more information please contact PartnerLinQ.

For many enterprises EDI is the main source of how revenue flows into the business. It’s often considered the lifeblood of a company. If not done well there can be a great deal of risk and hardship.

Managing an EDI campaign requires a specific knowledge base that few have. Different from other areas of business these skills are not widely carried across the majority of today’s technical staffs. Generally companies are lucky to have a small handful of people with this unique background. This makes choosing the correct software/service provider and delivery model imperative to avoid problems that could damage customer relationships and cash flow.

Many other technology platforms that companies invest in have inherent cross training. CRM and ERP environments often have large teams of people that work on them and in them on a daily basis. This is rarely the case with EDI.

For years companies didn’t have much choice when it came to B2B community enablement. They are mandated to participate by their trading partners and this would require them to buy software and hire the appropriate technical talent. Fortunately today there are choices. Some still buy the software, maintain the environment and staff required. Some take advantage of other delivery models and offload much of the heavy lifting when it comes to EDI.

There are three general delivery models to choose from:

• On premise / self-managed
• Hosted / self-managed
• Cloud / managed service

On premise / self-managed model has been around for forty years. This is a common choice for companies that still desire to keep everything in-house and don’t assign a great deal of importance to a cloud strategy.

Hosted / self-managed model is similar. The end user still needs to maintain the staff with the required skillset. Their EDI environment may be collocated in an offsite data center but the company is still responsible for the daily maintenance of the environment, adding transaction sets / trading partners and error resolution.

With the prevalence of cloud based ERP and CRM solutions today the two models above, for some, make less sense and carry a risk of failure. Getting and keeping EDI capable people has become difficult. Companies that have made the decision to implement a cloud/managed service delivered ERP/CRM see the value in outsourcing.

When making a decision on which direction and delivery model to choose a company needs to look a three things. Does this provider line up with your cloud strategy? Do you want to maintain EDI capabilities in-house? Do you see the value and reduced risk involved with today’s cloud/managed service delivery? The answers to these three questions should help point you in the right direction. To learn more please Contact PartnerLinQ.

EDI Solutions for Dynamics 365

Complete EDI, B2B and API solution for frictionless partner communication.

Exchanging business data with other organizations can be expensive and technically challenging:

• Many EDI solutions fail to scale to high volumes and become sluggish under peak loads
• Standalone EDI systems need to be maintained separately from ERP platforms and create a disconnect between EDI processing and other business processes.
• Your partner will use probably different EDI platforms and data formats than your own.

Traditional EDI platforms have multiple limitations. Partner onboarding can be time-consuming and frustrating, and communicating with partners that don’t use EDI requires expensive, difficult-to-maintain customization. Complicated error tracking, poor transaction visibility, and vendor rule management lead to expensive chargebacks that can severely impact your margins.

PartnerLinQ simplifies partner onboarding by supporting business rule-based transactions with businesses with existing EDI setups as well as non-EDI businesses. Its advanced business rule engine and extensive pre-configured business rule library make it easy to configure, save, and reuse business rules for multiple partner organizations and EDI scenarios.

PartnerLinQ can be configured to generate alerts that are triggered when specific conditions are met, and can be used to quickly identify EDI bottlenecks or errors. These notifications are a critical component of PartnerLinQ’s error handling functionality and can help reduce business costs by preventing chargebacks and low transaction throughput.