The ways in which EDI improves visibility within the supply chain

Studies conducted regarding the benefits of EDI implementation have consistently shown that most respondents felt that their biggest improvement following onboarding has been the boost in visibility of orders and shipments in the supply chain.

This ranked among the top benefits that companies gained and it is not difficult to see why: today’s business environment is fast-paced, making it crucial to have real-time insight into every transaction that took place. By having this perk on their side, companies can make decisions even faster and tend to be more responsive to ever-changing customer requirements.

EDI transactions intensify the benefits of real-time visibility for order status within the supply chain. For instance, if you are a manufacturer in Romania, you can easily send your purchase order to your supplier in UK, who in turn sends back an electronic document saying that the item is out of stock. At this point, you can immediately make the same inquiry with a supplier from France, giving you the possibility to quickly prevent an otherwise catastrophic situation.

With this information at the tip of their fingers, companies can plan delays, efficiently deal with bottlenecks and manage customer expectations and requirements. Now this is thinking ahead.

Let’s look at a few documents that boost visibility into the supply chain:

  • Purchase Order Acknowledgment: This document is sent by the supplier notifying that they will fill the purchase order as requested.
  • Remittance Advice: The buyer is thus notified regarding a completed payment, typically via electronic funds transfer. This helps suppliers better organize themselves, by letting them know which invoices have been completed for any payments.
  • Transportation Carrier Shipment Status Message: The carrier notifies the shipper or receiver regarding the status of a shipment. It is a document that offers information such as destination point, estimated date and time of arrival, reasons for any possible delays etc.
  • Advance Ship Notice:This electronic packing slip basically confirms to the buyer that the goods were shipped, it informs on the packing method, as well as on the estimated arrival time. You may also recognize this document under the name of Delivery Notice or Dispatch Advice. A series of automated business processes, such as Drop-Shipping, Cross-Docking and Evaluated Receipt Settlement rely heavily on this important document.

In conclusion, EDI is basically a launch-pad for strategic benefits to flourish and multiply, especially when combined with other commerce technologies available nowadays.

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