Author Archives: Foundational

1. EDI and e-Business Glossary

   June 5, 2015 8:31 pm Leave a Comment

   Following is an explanation of a variety of terms used in the world of EDI & e-business and their definitions.  Bear in mind that this is not intended to be a technical document – these are intended to be understood by someone with limited EDI experience.

   This is a dynamic list that I’ll be adding to regularly so if there is something I’ve overlooked please leave a comment or send me a note and I’ll update it.

    

   AS2 – Short for Applicability Statement 2.   A secure, internet based communications method.  Popular with EDI users since it is easy to implement and eliminates the need for a VAN.

   CSV – Short for “comma separated values”.  A common file format for importing and exporting data from software applications.

   EDIFACT – An EDI format that originated in Europe.  In the US is it less common than X12, but still used quite a bit.

   FTP – Short for “file transfer protocol”.  This is a communications method that is popular for moving data between computers.

   ISA – Interchange Control Header.  This is the envelope, or first part of an X12 EDI file. It contains the ID that specifies who is sending and receiving the transactions within.  Your EDI ID, which uniquely identifies your organization, is sometimes called the ISA ID.

   VAN – Short for Value Added Network.  A private network that is commonly used for EDI.  Numerous VANs are available, and they interconnect with one another.  VANs typically charge a fee per kilocharacter for data that is transmitted over their network.

   X12 – The EDI data format standards most commonly used in the US.

   XML – Another data format that is commonly used for EDI.  Easier for humans to read but has its limitations, including less ubiquitous parsing tools.  See “Silver Bullet” whitepaper for more detail. (http://getfoundational.com/silver-bullet-whitepaper/)

    

2. The Three Stages of EDI Implementations : Intro

   June 4, 2015 3:06 pm Leave a Comment

   Last month at TUG Connects, a conference for users of various Infor systems including FACTS, A+ and SX.e, I conducted a session about the various stages of EDI implementations.  I thought this was a compelling topic of discussion because e-business offers various benefits (efficient processing, error reduction, faster receipt of invoices, etc.) but many companies begin an implementation simply to comply with the requirements of their customers and too few advance to where they’re enjoying real benefits and improving their organizational processes.  In fact, over the years I’ve dealt with a handful of customers that pursued EDI with little intention of actually going live.  One even told me that all he wanted me to do was call his customer and tell them that “we’re working on it”.  Actually getting it done and going live was hardly a priority.

   Naturally, the organizations that enjoy real gains from e-business are those that look internally to see how the process can help them, and explore ways to do more with it than simply provide their customers with an electronic file – or worse yet, perform mundane data entry tasks for their customers!  This can be challenge given the fact that EDI is somewhat of a niche technology, and too few really understand how to make the most of it.  Helping organizations transition from seeking “compliance” to seeking real benefits has been my mission for much of my career.

   I separate the three types, or stages, of an EDI implementation into the following:

   1. Initial Stage – basically just satisfying the requirements of a few trading partners
   2. Limited Use – multiple trading partners, enjoying some benefits, but not sure how to make the most of EDI
   3. Extensive Use – EDI with anyone that’s willing.  The proverbial “hub” company

   Over the next couple of days I’ll post more details on the three stages of EDI implementations, and offer insight to the options you have for making the most of EDI while you’re in that stage as well as how to progress to the next level and gain additional benefits.

   As always, comments are welcome…stay tuned for part 1.

3. Paragon B2B is now Foundational e-Business

   April 16, 2015 3:56 pm Leave a Comment

   Outsourced e-Business and Managed EDI Services on a Strong Foundation

   Nine years ago, Paragon Consulting created a Managed EDI Service in response to customer need.  Paragon already had over a decade of experience with enterprise IT consulting, and had recently purchased the rights to Metalware, an ERP system designed for metals and steel processors.

   The Managed EDI Service addressed the needs of Metalware clients, and other Paragon Consulting customers to conduct EDI in a more efficient and cost effective manner.  It wasn’t long before the service took on a life of its own and became a separate business unit within Paragon, and it became known as Paragon B2B.

   Since inception, Paragon B2B has been dedicated to providing excellent value and service.  We act as the outsourced EDI and B2B department for our customers – ensuring that EDI and e-Business flows smoothly and is handled by our e-Business experts so that our customers can focus on what they do well.

   Fast forward to 2015, and Paragon B2B is again evolving.  We believe the transactional data that is communicated via EDI and e-business is the foundation of your business and we’ve created a brand that conveys that belief, Foundational e-Business.

   We are still the same experts with decades of experience with EDI and e-Business.  We are still passionate about providing exceptional value and stellar customer service.  However, we now have an updated name, look, and brand.

   We hope you like the new look and content.  We look forward to providing additional content related to the world of e-commerce.  If you have questions about us, the state of the e-business industry, or specific e-commerce questions we’d love to hear from you!

4. What is VMI and is it important to me?

   March 19, 2015 1:52 am Leave a Comment

   VMI, or Vendor Managed Inventory is a buzzword that has at times garnered a bit of attention in the e-business circles.  It isn’t a new idea, but it isn’t always well understood…so here’s a quick primer.

   At its core, VMI is simply a partnership between a customer and supplier – the supplier assumes responsibility for maintaining the customer’s inventory levels in warehouses or stocking locations.  This is where it’s important to spend time on the critical first steps.  You need to put some thought into questions such as: which items make sense to replenish via VMI?  How much should I keep in stock for these items?  How much should be ordered when stock levels warrant replenishing?

   Once the ground rules are established, communications between customer and supplier is key.  The supplier needs to know how much of an item is in inventory, how much is scheduled to be consumed, etc.  The customer needs to know when the next replenishment order is created, when to expect the shipment to be received, etc.  This is where e-business and EDI become important.

   On a regular basis (typically daily), the customer’s business system communicates inventory levels to the vendor’s VMI system.  The vendor’s VMI system uses this data, paired with pre-determined triggers, to determine when replenishment orders should be created and how much quantity the orders should contain.  Once the order is created, it is automatically communicated from the vendor’s VMI system to the customer’s business system.  As the order is processed and shipped, the shipment information is transmitted from the vendor’s system to the customer’s system.  This enables the customer to have precise information about the expected shipments, enabling the creation of in-transit tags to speed up the receiving process.

   Why Use VMI?

   There are some obvious benefits to letting your vendor automatically replenish an item based on pre-determined triggers and activity.  There are some less obvious advantages as well.  The most obvious is that your staff spends less time managing inventory replenishment, and can therefore focus on more value-add activities (forecasts, pricing strategy, and so on).

   In addition to the more efficient processing, the expedient information flow enables you to better manage inventory levels.  It is common for VMI users to report that inventory turns increase by 20{5080e6b8eec03ac51702ada5b6897314ab7bc3a139127375f379f0820275a75a} or more after implementation.  Furthermore, since VMI is driven by information that is automatically transmitted between computer systems, data entry time and errors are dramatically reduced – and your business can be provided with new insights such as knowledge of exact shipments coming from the vendor.   Each individual benefit – efficient processing, error reduction, and better / more timely information lead your organization to the ultimate benefits – improved supply chain integration and reduced workload.

5. The problem with portals

   1:50 am Leave a Comment

   Any time I get the opportunity to speak with customers or potential customers I like to ask about what is working well for them what’s not working so well.  Particularly when it comes to EDI and e-business.  One of the e-business complaints I hear most often is that companies are spending too much time jumping from portal to portal in order to retrieve orders, send invoices, send ship notices, etc.

   My aim, ever since getting started with EDI 20 years ago, has always been to help businesses communicate more effectively with e-business. In my early days, the EDI portal was touted by many as the solution to ensure EDI compliance across the supply chain. I was never impressed with this one-sided solution.  The portal owner basically wins by offloading the data entry to the trading partners on the other side of the transaction.  In my book, this doesn’t qualify as improved efficiency…it’s just shifting the burden elsewhere.  It also leaves the door open for human error.

   To my dismay, nearly 20 years since I started working with EDI the portal is still one of the top e-business complaints among small to medium size businesses.  Often times I’m asked what tools we can provide that will automate the jumping around from one portal to the other – I’ve even been asked to develop an API to connect to a popular retailer’s e-business portal.  Naturally, this doesn’t make sense and when I offered up EDI as an alternative solution it opened up an entirely different, and productive conversation.

   My advice to the SME that has to visit multiple portals: make better use of EDI.  If your trading partner is sophisticated enough to set up a web portal to manage transactions surely they’re capable of conducting real e-business.  20 years ago it rarely made sense for the small to medium size business to jump into EDI, but many things have changed in that time.  It really doesn’t have to be expensive, and it certainly doesn’t need to rack up costly consulting hours or require in-house expertise.  Perhaps it did 20 years ago…but not any more.  So the next time your big customers points you to their portal, tell them you’d rather do it right and use EDI.  They’ll probably be impressed with your initiative to do it the right way.