EDI Introduction – ecosio Connections That Work Fri, 08 Aug 2025 12:28:38 +0000 en-US hourly 1 https://ecosio.com/app/uploads/2020/02/favicon-96x96-1.png EDI Introduction – ecosio 32 32 AI and EDI: strengths, challenges and what to expect https://ecosio.com/en/blog/ai-and-edi/ Tue, 13 May 2025 16:21:42 +0000 https://ecosio.com/?p=73550 🔍 TL;DR summary AI can enhance EDI through error detection, data mapping, and predictive analytics, helping teams spot issues earlier and automate manual tasks OCR tools powered by AI enable fast document conversion, reducing reliance on manual data entry Key challenges include technical inaccuracies, legacy system compatibility, and data privacy concerns, requiring careful implementation AI […]

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🔍 TL;DR summary

  • AI can enhance EDI through error detection, data mapping, and predictive analytics, helping teams spot issues earlier and automate manual tasks
  • OCR tools powered by AI enable fast document conversion, reducing reliance on manual data entry
  • Key challenges include technical inaccuracies, legacy system compatibility, and data privacy concerns, requiring careful implementation
  • AI is a valuable complement to EDI, but still needs human oversight to ensure accuracy and business context

AI is everywhere these days. From online shopping to booking a taxi, artificial intelligence is quietly transforming all sorts of everyday processes. But what about in the world of B2B communication – specifically electronic data interchange (EDI)? Can AI and EDI work together to improve your business operations? 

In this article, we’ll explore how AI is starting to reshape EDI processes, where it shines, where it struggles, and what you should be aware of if you’re considering making AI part of your EDI strategy.

The rise of AI across business operations

Over the past decade, the adoption of AI across business sectors has skyrocketed. From a distant concept, AI has quickly become mainstream, with a recent Accenture report finding that 84% of executives “believe they won’t achieve their growth objectives unless they scale AI”. Amazingly, the same report also states that 75% of executives “believe they risk going out of business in five years if they don’t scale AI”.

More than many other sectors, supply chain businesses have been profoundly impacted by AI, largely due to their reliance on fast, high-volume data exchange and complex transactional processes. Among other things, these businesses are now leveraging AI to:

  • Predict inventory needs
  • Automate procurement workflows
  • Optimise delivery routes
  • Detect anomalies in real-time supply chain data

EDI and AI: potential utilisations

Error detection and correction

Possibly the simplest and most powerful way that AI and EDI can be combined is by using AI to spot errors. Specifically, as AI is extremely good at being able to spot anomalies in data patterns, it can be used to flag possible issues that humans might miss. 

In traditional EDI, individuals only notice something is wrong when a shipment is late or an invoice goes missing. With AI, patterns are continuously monitored. If something’s off even a little bit, AI can raise the alarm early.

For example, if you usually receive 500 purchase orders every Wednesday and one week you only get 250, this change itself is not an error. However, such a pattern change can indicate something has gone wrong, and flagging this early enables relevant teams to investigate and rectify any possible issue before it develops.

Data mapping

Traditionally, setting up document mappings requires hours of manual effort and a great deal of technical expertise. Hypothetically AI can help automate parts of this process by “learning” from existing mappings and making appropriate suggestions.

Predictive analytics

AI doesn’t just see what has happened; crucially it can also predict what might happen next. By analysing past EDI data, AI can anticipate supply chain disruptions, helping you to plan ahead and avoid potential issues before they happen.

Document conversion

Imagine feeding a paper invoice into a system and having it instantly converted into an EDI-compliant format. AI-driven OCR (Optical Character Recognition) and data structuring tools are making this a reality, eliminating the need for error-prone manual data entry.

EDI and AI: key challenges

Although the potential of AI to streamline and simplify B2B processes is huge, it’s important to stay grounded. AI isn’t a magic wand… yet. There are still several issues and potential hazards associated with AI usage, including…

Technical inaccuracies

EDI isn’t a “one-size-fits-all” world. There are countless EDI formats (like EDIFACT, ANSI X12, and XML), as well as standards that vary by industry and region. Teaching an AI to handle all these perfectly is tricky and the results typically require significant fine-tuning.

In EDI even the smallest error can have a big impact. Consequently, if you ask an AI tool to convert a document into a certain EDI format, it may do it 99% correctly… but that 1% is a problem.

Diverse protocols of trading partners (when onboarding)

Different partners prefer different EDI protocols (AS2, OFTP2, SFTP, and so on). AI can help recommend configurations, but ensuring protocol compatibility still needs human oversight to ensure success.

Legacy systems compatibility

Many companies still rely on legacy ERP systems that weren’t built with AI in mind. Integrating modern AI solutions with these older environments can feel like trying to fit a square peg into a round hole.

Data privacy

Handling sensitive business data demands strict privacy controls. Using AI can introduce compliance risks if not managed carefully, particularly where cloud solutions are involved. It’s important to ensure that any AI system you use adheres to GDPR and other relevant standards.

Lack of context

AI can be impressive, but it doesn’t “understand” your business context the way a human does. It might suggest a mapping that looks technically correct but doesn’t make sense operationally. Without context, errors can easily slip through the cracks.

Conclusion

AI and EDI are a powerful combination, offering real potential to streamline processes, reduce manual work, and spot issues before they become problems. However, like any new tool, AI needs to be applied carefully, with an understanding of both its strengths and its current limitations.

See how ecosio can help you streamline your EDI processes

At ecosio, we’re passionate about making B2B integration effortless and that includes harnessing the best of AI where it genuinely adds value. If you’d like to learn more about how we can help you future-proof your B2B integration processes, get in touch today!

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ecosio Insights: Digital Transformation Projects and the Role of B2B Integration https://ecosio.com/en/blog/ecosio-insights-digital-transformation/ Fri, 13 Dec 2024 15:37:00 +0000 https://ecosio.com/?p=70686 Digital transformation projects are rapidly gaining momentum across virtually all industries as businesses recognise their potential to streamline operations and provide a competitive edge. Despite the growing popularity of such initiatives, however, many businesses are undermining these projects’ potential by failing to prioritise B2B integration methodologies, such as EDI and E-invoicing. To help provide some […]

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Digital transformation projects are rapidly gaining momentum across virtually all industries as businesses recognise their potential to streamline operations and provide a competitive edge. Despite the growing popularity of such initiatives, however, many businesses are undermining these projects’ potential by failing to prioritise B2B integration methodologies, such as EDI and E-invoicing.

To help provide some clarity regarding current B2B integration trends and the main challenges facing those businesses embarking on digital transformation projects, I sat down to discuss these topics and more with ecosio Co-founder and EDI expert Philipp Liegl. In the following interview, Philipp shares his thoughts on what successful digital transformation looks like, and how businesses can unlock sustainable growth and build stronger, more collaborative partnerships.

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How do you predict B2B integration will evolve over the next five to ten years?

In the next few years we should see automated system-to-system communication replacing manual methods like email, PDF and paper. I also expect to see better visibility of EDI and e-invoicing directly within ERP systems, as companies move away from a siloed approach in search of a unified solution.

As more countries introduce e-invoicing mandates, procure-to-pay and order-to-cash processes will also have to change accordingly, which will result in challenges for businesses operating across diverse regulatory environments. At the same time, tax compliance and supply chain operations are converging as governments demand greater digitalisation and real-time reporting. For organisations of all sizes, success in this new landscape will depend on embracing automation, enhancing integration, and addressing compliance as a strategic priority.

Is a universal document exchange format ever likely to happen?

Thanks to the rise of government-mandated e-invoicing formats, there are certainly signs that standardisation is improving. For example, UBL is becoming widely adopted across Europe due to its alignment with EN 16931 and Peppol. Meanwhile, UBL’s popularity is also growing outside of the EU, with countries such as Saudi Arabia recently adopting UBL subsets. 

Yet, much like separate dialects of the same language, even within UBL, regional adaptations persist. Whether it’s UBL, EDIFACT, or EDIFACT-subsets like EANCOM, global standards are rarely used in their “vanilla” form as they are too generic to meet specific business needs. Ultimately, total standardisation will realistically never happen for this reason.

How do you see B2B integration fitting into broader digital transformation strategies?

While there are obviously benefits to digitising any manual process, such as submitting timesheets or holiday requests, the processes which have the greatest impact are those that cross organisational boundaries—such as exchanges with suppliers, customers or governments.

By automating the exchange of key B2B messages, like orders, invoices and delivery notes, businesses can not only reduce errors, but also enhance resilience and provide real-time visibility into critical operations. In turn, this enables organisations to operate with greater speed and confidence moving forward. As such, in my opinion, EDI and B2B automation should be at the very centre of digital transformation efforts.

Following the recent wave of e-invoicing mandates, do you expect to see similar regulations covering other B2B processes soon?

Absolutely! The main goal of the recent e-invoicing mandates in Europe has been to reduce the “VAT gap” caused by fraud and underreporting. But e-invoicing is only one of a number of ways governments can tackle this. Over the coming years we will undoubtedly see governments introduce legislation concerning other tax-relevant documents which provide proof that transactions are legitimate, such as delivery notes and probably also purchase orders.

Just as businesses reconcile invoices with delivery and purchase order records to confirm the validity of transactions, governments aim to ensure compliance by tracking the entire process. Accordingly, expanding automation requirements beyond e-invoicing would not only strengthen tax collection efforts, but also minimise fraud and promote greater transparency and accountability across B2B operations.

Are people’s expectations changing when it comes to B2B integration?

Definitely! In the past, EDI was typically managed via local software, which was reliant on the deep technical knowledge of internal individuals. Over the last decade there has been a clear shift towards externally managed solutions that are deeply integrated into businesses’ ERP systems. Just like we don’t expect to have to establish the technical connection ourselves when we make a phone call, businesses today expect their providers to handle all technical B2B integration intricacies for them behind the scenes. Plus, with governments mandating automation of more and more B2B processes, we’re seeing a growing demand for providers to offer a broader range of services. Where previously businesses may have had one provider for tax compliance, another for EDI, and an in-house solution for e-invoicing, these businesses are now looking for one provider that can handle all at once.

What role do you see technologies such as AI and machine learning playing in digital transformation projects?

AI and machine learning are certainly helping to enhance efficiency and streamline B2B integration processes, particularly in areas like mapping creation and pattern recognition. For example, machine learning can be used to flag potential issues that wouldn’t otherwise have been detected – such as if a regular purchase order doesn’t arrive when expected – allowing for proactive escalation. 

AI does face limitations, however, as it operates based on patterns, probabilities and learned behaviours, which can lack the precision necessary for specific compliance tasks. In critical areas like business document mapping creation, for example, where 100% accuracy is essential, pure reliance on AI may still be risky, as errors could have significant consequences. That might change with the further development of these technologies. One thing is for sure: 100% deterministic behaviour is a must with all compliance operations. As long as AI is not able to meet that 100%, in can only play a supportive role.

How do you think the increasing automation of B2B processes will impact the roles and skills required in internal teams?

Regarding skills, those handling B2B integration need to have technical expertise in three key areas. First, they have to understand the choreography of document exchanges, including the sequence and interdependencies between documents like purchase orders and invoices. Second, they must understand the diverse payload formats used across different regions and industries. Finally, they must have technical communication channel expertise in order to navigate the varying API standards and complex authentication mechanisms required in different countries.

When it comes to who handles B2B integration, organisations have three options: develop in-house expertise, hire external contractors to manage the process, or enlist the help of specialised providers. One thing is true no matter what option is opted for, however; successful automation requires a dedicated owner to coordinate resources, ensuring accountability and alignment. B2B integration can no longer be managed as a side task by unrelated roles—it demands focused leadership to drive efficiency and reliability.

What are the key B2B integration challenges likely to be for businesses embarking on digital transformation projects?

I would say there are four key challenges. The first, and the biggest, will always be master data. Without clean, consistent master data even the best integration systems will struggle to function effectively. If someone could somehow eliminate all master data issues this would definitely be worthy of a Nobel prize in my book! 

The second challenge is sorting a B2B integration team, as B2B integration is very much a people-driven initiative and isn’t something that can be handled as a side task. You need dedicated team members in key areas like order-to-cash and purchase-to-pay to make it work. 

The third major challenge is process alignment, as many ERP systems still rely on outdated outputs, such as PDFs or paper documents, which aren’t designed for EDI. Before they can fully embrace integration, businesses must modernise these processes. 

Last, but not least, is ERP system compatibility. Successful B2B integration requires a seamless flow of data in and out of ERP systems. Unfortunately, older or off-the-shelf solutions, such as AS400-based platforms, often aren’t ready for this level of integration. Any business with such systems will have to upgrade them or find workarounds if they want to achieve significant improvements.

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Want to learn more about current EDI trends?

In our new report, “The Future of B2B Integration“, we explore the findings from our recent survey. In this survey we asked professionals working with B2B automation technologies across various industries to share their perspectives on everything from e-invoicing to the role of EDI in building business resilience.

Trends covered include the growing importance of EDI, building resilience through automation, e-invoicing, and cloud migration.

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Is Cloud Migration the Future of B2B Integration? https://ecosio.com/en/blog/is-cloud-migration-the-future-of-b2b-integration/ Fri, 09 Aug 2024 08:06:16 +0000 https://ecosio.com/?p=67656 🔍 TL;DR summary Moving to the cloud cuts hardware and maintenance costs, improves reliability through redundant infrastructure, and delivers flexibility, scalability and resilience with better data visibility and automatic updates A recent survey found 65% of respondents expect cloud-based EDI to become the norm, while only 13% do not expect its popularity to grow Remaining […]

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🔍 TL;DR summary

  • Moving to the cloud cuts hardware and maintenance costs, improves reliability through redundant infrastructure, and delivers flexibility, scalability and resilience with better data visibility and automatic updates
  • A recent survey found 65% of respondents expect cloud-based EDI to become the norm, while only 13% do not expect its popularity to grow
  • Remaining on outdated on-premise systems can harm efficiency and increase long-term costs, especially when the total cost of ownership is underestimated by excluding time and personnel expenses
  • Businesses still using locally-hosted software should assess whether cloud migration could improve efficiency and resilience, as migration projects do not have to be complex or disruptive

Over the past decade there has been a clear and continual shift by supply chain businesses away from hosting business-critical software locally. Whether it’s multiple department systems or just a lone software instance, the vast majority of businesses have participated in cloud migration to some extent, with Accenture calculating the adoption of cloud technologies to have grown from 82% to 95% between 2019 and 2021 alone.

When you consider the benefits of moving B2B processes to the cloud, it’s not hard to see why so many companies are doing so. From a cost perspective, moving to the cloud reduces expenses relating to hardware and maintenance. Further, while security concerns are often cited as a key reason not to move to the cloud, cloud-based solutions typically offer a redundant infrastructure, making them much more reliable than locally-hosted systems. Most compelling of all, however, is the flexibility, scalability and resilience offered by the cloud, as processes and resources can be adapted quickly and easily as needs change. What’s more, cloud-based solutions also often offer better data visibility and are typically updated automatically.

What we have found

In line with recent trends, in our recent survey we found that the vast majority of respondents (65%) expect cloud-based EDI to become the norm in the future, with only 13% of those surveyed not expecting cloud migration to become more popular.

the-future-of-cloud-based-edi-stats

The Future of B2B Integration Survey, 2024

What can you do?

If you are still running your systems via locally-hosted software, it’s worth considering if moving to the cloud could improve efficiency, flexibility and resilience. While sticking with your current solution may seem like the easier choice, migration projects don’t have to be difficult or disruptive, and sticking with an outdated system will cost your business dearly in the long run. When assessing your options, it’s also important to consider all related costs. Many businesses wrongly assume that on-premise solutions are more cost-effective purely because they fail to properly calculate the total cost of ownership by ignoring key factors such as time and personnel costs.

“Companies with modern technology architectures outperform their competitors with better customer service, more efficient operations, and stronger customer advocacy.”

Bain Technology Report 2023

Questions to ask yourself

  • Would increased system flexibility help you in achieving strategic goals moving forward?
  • How confident are you that you can retain sufficient in-house expertise to keep internal systems running smoothly as your business grows/evolves?
  • Do you currently operate a redundant infrastructure or are you at risk of catastrophic data loss?
  • Are you aware of what modern cloud-based B2B integration solutions can deliver?
  • Could cloud migration benefit your business?

Want more information on EDI trends?

This article is based on a section from our recent report on The Future of B2B Integration, in which we share survey results as well as predictions concerning the most significant B2B integration trends. To download your free copy now, simply visit the report download page and enter your details!

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Can Increased Automation Build Supply Chain Resilience? https://ecosio.com/en/blog/can-increased-automation-build-supply-chain-resilience/ Fri, 09 Aug 2024 08:02:27 +0000 https://ecosio.com/?p=67655 🔍 TL;DR summary The last five years has seen a surge in recognition by businesses of the importance of building supply chain resilience Automating key B2B processes minimises the potential for human error, improves speed, and frees up staff to focus on more valuable tasks In a survey of supply chain executives, 88% believe that […]

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🔍 TL;DR summary

  • The last five years has seen a surge in recognition by businesses of the importance of building supply chain resilience
  • Automating key B2B processes minimises the potential for human error, improves speed, and frees up staff to focus on more valuable tasks
  • In a survey of supply chain executives, 88% believe that optimising automated B2B processes can improve supply chain resilience, and over half predicted that efficient automation would improve it “substantially
  • 62% of respondents saw automated B2B communication as “very important” to the success of their business moving forward, with none seeing it as unimportant or irrelevant

The last five years has seen a surge in recognition by businesses of the importance of building supply chain resilience. Global events have highlighted the dangers of being unable to react to disruptions, and organisations are increasingly aware of the value of flexibility and adaptability, particularly when it comes to critical B2B processes. Yet despite this, according to a recent KPMG survey, 47% of supply chain executives believe they are still “vulnerable to disruption”.

While there is obviously no way to predict the future, there are pragmatic steps that businesses can take to boost supply chain resilience. Perhaps the simplest and fastest of these to achieve is improving B2B automation. Not only does automating key processes minimise the potential for human error, it can also improve speed and free up staff members to focus on more valuable tasks. In the event of unforeseen circumstances, businesses thus benefit from increased flexibility, as the majority of business-critical tasks aren’t dependent on human intervention. 

What our research shows

As part of a wider research project concerning B2B integration trends, we recently conducted our own cross-industry survey in which we asked people their views on the importance of B2B automation.

Of the over 100 supply chain executives we surveyed, 88% believe that optimising automated B2B processes can improve supply chain resilience. Further, over half of those surveyed predicted that efficient automation would improve supply chain resilience “substantially”.

Similarly, 62% of respondents saw automated B2B communication as “very important” to the success of their business moving forward, with none seeing it as unimportant or irrelevant.

Can increased automation build supply chain resilience-stats

The Future of B2B Integration Survey, 2024

What can you do?

Improve and expand automation of business-critical processes! Not only will expanding and optimising automated processes streamline processes and minimise the possibility of human errors, it will also free up internal teams to be able to focus on more value-adding activities.

In particular, introducing electronic data interchange (EDI) and e-invoicing can make a huge difference to the efficiency of day-to-day messaging and drastically improve supply chain resilience.

“As more of the supply chain becomes automated, roles can be redefined to focus on higher-value customer services, and new roles will emerge for humans that drive strategy and innovation.”

KPMG

Questions to ask yourself

  • Are existing B2B integration processes inhibiting your company’s ability to react quickly to market changes?
  • Do you currently have business-critical processes that could be automated?
  • Are any key supply chain operations reliant on one or two individuals?
  • Have you considered investing in a Web EDI solution to extend automation across your entire partner landscape?
  • Would internal team members be able to add more value elsewhere if EDI tasks were outsourced?

Want more information on EDI trends?

This article is based on a chapter from our white paper “The Future of B2B Integration – Market Trends Report”, in which we share survey results as well as predictions concerning the evolution of B2B integration. To download your free copy now, simply visit the white paper page and enter your details!

Discover more about our updated product, ecosio.flow.

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Should Data Accessibility Be a B2B Priority? https://ecosio.com/en/blog/should-data-accessibility-be-a-b2b-priority/ Fri, 02 Aug 2024 08:05:18 +0000 https://ecosio.com/?p=67654 All supply chains depend on data. What separates successful businesses from those that struggle is more than just the depth and quality of that data, however. More than ever, it’s data accessibility that sets industry leaders apart from their competitors.  Nowhere is this more true than with B2B integration processes. While electronic data interchange (better […]

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All supply chains depend on data. What separates successful businesses from those that struggle is more than just the depth and quality of that data, however. More than ever, it’s data accessibility that sets industry leaders apart from their competitors. 

Nowhere is this more true than with B2B integration processes. While electronic data interchange (better known as EDI) is increasingly central to supply chain success, the data exchanged by supply chain partners via EDI is often something of a black box when handled in-house. With relevant teams, such as Purchasing, unable to access data directly, bottlenecks quickly develop, undermining the benefits of automated B2B communication. 

As future-thinking businesses are starting to recognise, however, issues like this aren’t difficult to eliminate. With customer and partner expectations continuing to rise, more and more businesses are prioritising B2B data accessibility in order to streamline operations and improve decision-making. According to a recent KPMG poll, 87% of supply chain executives now see increasing data accessibility as “critically important”, with 61% identifying it as “top priority”. 

What we found

In line with KPMG’s findings, we also found in our recent survey that respondents were very confident in the ability for improved data accessibility and visibility to boost supply chain success, with 77% believing that it could have a substantial impact, and 100% believing it could boost success at least a fair amount. 

Despite this universal recognition, however, it seems many businesses still have a long way to go to reach the desired level of data transparency. When asked to grade their company’s current data accessibility/visibility, only 56% of the B2B integration professionals we asked answered “good” or “very good”, with a worryingly high 44% responding “bad” or “very bad.

market-trends-report-stats

What can you do?

If data accessibility is an issue in your business, enlisting the help of an experienced external provider may well be the answer. Rather than integrating new functionalities or managing a complete system migration project yourself, by opting for an external solution, you will benefit from faster migration times and tried and tested processes. 

Questions to ask yourself

  • Do all relevant teams have acceptable data accessibility currently?
  • How easy is it for individuals to find data within your existing solution?
  • Does your current B2B integration solution offer real-time visibility of message statuses?
  • How important is it for your business to be able to make accurate predictions?

Want to see what else we found?

This article is based on a section from our recent report on The Future of B2B Integration, in which we share survey results as well as predictions concerning the most significant B2B integration trends. To download your free copy now, simply visit the report download page and enter your details!

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The Future of Supply Chains: Expert Insights https://ecosio.com/en/blog/the-future-of-supply-chains/ Mon, 20 May 2024 13:39:00 +0000 https://ecosio.com/?p=65945 With new technologies such as AI and blockchain developing at such a rapid pace, the future of supply chains is a topic of significant concern for many businesses today. Yet while new technologies may be grabbing the headlines, a look at wider shifts in modern B2B relationships suggests that the next decade is more likely to […]

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With new technologies such as AI and blockchain developing at such a rapid pace, the future of supply chains is a topic of significant concern for many businesses today. Yet while new technologies may be grabbing the headlines, a look at wider shifts in modern B2B relationships suggests that the next decade is more likely to be defined by the adoption of new approaches to older, more embedded technologies. In particular, electronic data interchange (EDI) solutions are changing rapidly, and as automated communication is such a crucial part of modern commerce, supply chain success seems increasingly tied to companies’ EDI and e-invoicing proficiency.

To provide some insight into what the next few years are likely to hold for supply chain businesses, we asked ecosio co-founders and B2B integration experts Philipp Liegl and Marco Zaplatel to give us four key predictions. Here’s what they said…

#1 – Electronic data interchange (EDI) will continue to grow in popularity
Wooden blocks pointing up

Over the past two decades EDI has seen huge change. Thanks to dramatic advances in technology, not only is message exchange automation now possible across many more B2B processes, but crucially it is also now far more accessible. Whereas EDI was once a luxury open only to those businesses with extensive internal resources and technical expertise, today all businesses can experience the benefits of automated document exchange.

This accessibility, combined with other factors, such as the recent introduction of mandatory e-invoicing across much of Europe and the increased desire for supply chain sustainability in the wake of the recent pandemic, means that EDI’s popularity is only likely to grow further in the coming years. This is also echoed by recent research by Gartner, which predicts that a whopping 80% of B2B sales interactions between suppliers and buyers will occur in digital channels by 2025.

#2 – EDI will become increasingly central to business successMegaphone saying give me more

Due to factors such as the globalisation of markets, an ever-increasing demand for data visibility across supply chains, and the growing dependence of revenue upon successful data automation, businesses can no longer afford to treat EDI as an afterthought. What’s more, the financial benefits offered by EDI are only set to increase as technology continues to advance and improve the efficiency and transparency of automated data exchange. IDC research, for example, suggests modernised B2B integration could offer businesses a 308% ROI – or more than £3 in benefits per £1 invested!

It’s only logical, therefore, that the future of supply chains will see more and more businesses identify EDI as a critical component of ERP systems (as future-focussed organisations already do).

#3 – EDI will continue to become a “service”Happy warehouse man jumping

Unfortunately, EDI’s growing popularity doesn’t mean automated document exchange with partners will get easier from a technical perspective. Rather, as businesses look to extend automation across more processes, and different countries introduce different regulations, operating a successful EDI solution will become harder for in-house teams. As a result we should see more and more businesses adopting an EDI as a Service solution as part of a so-called “postmodern” ERP system, in which a core ERP system is extended with tailored cloud-based solutions from independent providers. This way, businesses can enjoy all the benefits of efficient document exchange with none of the hassle and risk. Essentially, EDI is about to transform from a technology for enterprises to a core service for enterprises… a core service, which is yielded by external service providers.

#4 – Solution flexibility and scalability will become a mustMany hands extending towards stressed man

Given the rapid pace at which tech is advancing and the volatility of modern supply chains, selecting an EDI solution that can evolve to suit changing needs will be a major concern for IT decision makers over the next few years. We expect to see more caution from buyers regarding potential future functionality changes and an increase in demand for cloud-based, modular solutions, in which updates are implemented on an ongoing basis by the provider and new features are added on a regular basis.

Conclusion

While what exactly the future of supply chains will be may be difficult to predict, what is certain is that cloud-based, EDI as a Service constitutes the only logical long-term option for many businesses. When it comes to key issues such as cost efficiency, sustainability and flexibility, there is simply no alternative.

At ecosio we’re always thinking of the future and pride ourselves of being ahead of the competition both in terms of technology and approach. While the ecosio cloud-based EDI solution (our Integration Hub) and dedicated document and integration engineers ensure you experience streamlined, hassle-free EDI today, our unique, cloud-based approach is designed to support you into the future. However your situation changes, our regularly updated, modular solutions and passionate EDI experts will ensure your solution remains successful. With “Connections That Work” you will experience the full potential and benefits of EDI with minimum effort.

Want to learn more about the future of supply chains?

This article is taken from our white paper Building Connections That Work: The ecosio Approach. To download your free copy today, simply follow this link and enter your details.

For a more detailed breakdown of the future of EDI, you may find our article on this topic interesting, too.

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How to Achieve B2B Process Automation Success https://ecosio.com/en/blog/how-to-achieve-b2b-process-automation-success/ Wed, 13 Mar 2024 11:09:00 +0000 https://ecosio.com/?p=65021 Implementing B2B process automation can seem like a daunting task, but it’s one that – when done correctly – can bring significant rewards in terms of efficiency, cost savings, and enhanced scalability. In this article we’ll explore the key steps you can take to ensure your B2B process automation project is successful, from the initial […]

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Implementing B2B process automation can seem like a daunting task, but it’s one that – when done correctly – can bring significant rewards in terms of efficiency, cost savings, and enhanced scalability. In this article we’ll explore the key steps you can take to ensure your B2B process automation project is successful, from the initial idea stage right up until project completion.

Define your B2B process automation goals

The first and most important step in any complex business project is to define your goals. Even if your goals seem obvious, detailing exactly what you would like to achieve will help you to develop a roadmap, identify ways of measuring success, and prioritise resources effectively. 

Sometimes, too, defining your specific goals will help to clarify to your team WHY you want to get to where you’re headed. Whether you’re looking to implement an e-invoicing solution or streamline communication with existing partners, agreeing on your exact goals will ensure everyone is on the same page and understands the plan and motivations.

Assess current capacity and internal resources

Once you’ve clarified your goals, the next step is to identify how able you are to achieve them with your current setup. This involves assessing both your technical capacity and the capability of your current personnel.

Technical capacity

When assessing technical capacity before a B2B process automation project, be sure to ask the following questions:

  • Is our IT infrastructure able to support increased automation (e.g. via RPA, blockchain, API, EDI, etc.)?
  • How well can our current systems integrate with electronic data interchange (EDI) and e-invoicing solutions?
  • Would it be useful for different teams to have direct access to EDI/e-invoicing data so IT doesn’t become a bottleneck?
  • Do we need redundant infrastructure?
  • Are we likely to need the ability to convert messages to/from different EDI standards in the future?
  • Are we likely to need the ability to send messages via different EDI protocols in the future?
  • Will we need Peppol connectivity?
  • Would a Web EDI solution be helpful to help automate exchanges with smaller suppliers?
  • Would end-to-end visibility of EDI and e-invoicing data be helpful?

Personnel

When assessing the capacity of your existing team before starting your B2B process automation project, make sure to ask the following questions:

  • Do we have sufficient technical expertise in-house?
  • Would training be sufficient to upskill existing employees?
  • Would our ability to operate be significantly disrupted by the absence or departure of certain individuals?
  • How much time would team members be able to devote to new processes and tasks?
  • Would team members be willing to adapt their roles and responsibilities if needed?
  • How would pressure on internal resources be affected if B2B process automation requirements were to increase in the future?
  • How will we keep track of new country-specific e-invoicing requirements?

After asking these questions you should have a clear picture of what level of automation is possible with your current system and which areas will need strengthening.

Consider outsourcing

For those businesses with limited internal resources, outsourcing is the obvious answer – particularly given the extent to which cloud computing has simplified external management of B2B process automation in recent years. 

However, even those businesses with substantial internal resources may also benefit from outsourcing certain processes such as EDI or e-invoicing to specialised providers. Not only are such providers experts in these fields, and therefore able to implement processes and technical changes faster, they also typically offer added benefits such as redundant infrastructure, direct integration into your current ERP system, and simple scalability.

And perhaps most important of all, employing an external provider to manage B2B process automation enables your team to focus on what they do best!

Establish clear roles and responsibilities

For automation to succeed, everyone in your organisation needs to know their role in the process. Clear delineation of responsibilities ensures smooth implementation and ongoing management of B2B process automation efforts.

Make sure when assigning responsibilities not to forget potential future tasks though… as this can result in a decline in efficiency and enthusiasm. 

For a detailed breakdown of the key roles in a typical EDI project, please see our dedicated blog article on this topic.

Prioritise data visibility and accessibility

Having automated processes is all well and good, but unless you have good visibility, efficiency can still suffer. No system is 100% error-free, and being able to identify an issue quickly and easily when one does arise can help ensure your system remains effective. 

For example, the best EDI and e-invoicing solutions will enable users to search across all documents using any relevant identifier, and may even allow you to view the status of sent documents in real time.

Think long term!

When it comes to B2B process automation, change is the only constant. Technologies evolve, and so will your electronic data interchange (EDI) and e-invoicing needs. 

Prioritising adaptability, scalability and sustainability is not just wise; it’s essential if you’re to be successful in the long term. Even if your EDI requirements are stable, your partner landscape is static and your internal team is committed right now, this will not always be the case. Unless your processes have been built with flexibility in mind, their efficiency will soon decline.

Don’t try to do too much too fast

Rome wasn’t built in a day, and neither is a robust B2B automation system. Start small, prioritise critical processes, and gradually expand your automation efforts to avoid errors and oversights.

For example, when onboarding EDI partners, rather than attempting to onboard all simultaneously, a more efficient approach would be to break your partners down into relevant groups (e.g. by country or value), and work through these groups one after the other.

Don’t be afraid to make big changes

Innovation often requires bold moves. While caution is wise, don’t shy away from making significant changes if they promise to improve B2B process automation. 

As EDI and e-invoicing are so central to the everyday operations of modern day businesses, many people are scared to adapt running systems for fear of disrupting them. As a result, many businesses persevere with outdated technology for far too long. But of course, the longer you put off such a project, the less efficient your current solution will become!

While implementing a major B2B process automation project can be daunting, particularly for those who haven’t done so before, the benefits can be remarkable. Plus, thanks to the emergence of fully managed B2B process automation solution providers, there’s now no longer any need to stress about disruption to existing systems or insufficient internal resources!

Summary

In conclusion, achieving success in B2B process automation requires a strategic approach. By establishing clear roles, prioritising data accessibility, and adopting a measured approach to implementation, your business can harness the full potential of EDI, e-invoicing, and other B2B automation avenues to streamline operations, reduce costs, and enhance efficiency.

If you’re interested in learning more about how B2B process automation could transform your business, contact us to learn more about ecosio’s unique EDI solution.

Discover more about our updated product, ecosio.flow.

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What Makes a Good EDI Dashboard? https://ecosio.com/en/blog/what-makes-a-good-edi-dashboard/ Mon, 19 Feb 2024 09:36:10 +0000 https://ecosio.com/?p=64229 In today’s fast-paced business landscape, having a robust Electronic Data Interchange (EDI) system is crucial to maintain efficient communication with partners, suppliers and customers. While there are many things that separate good and bad EDI solutions, arguably the most significant is the main interface – your EDI dashboard (also often referred to as an EDI […]

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In today’s fast-paced business landscape, having a robust Electronic Data Interchange (EDI) system is crucial to maintain efficient communication with partners, suppliers and customers. While there are many things that separate good and bad EDI solutions, arguably the most significant is the main interface – your EDI dashboard (also often referred to as an EDI monitor or EDI portal).

In short, an EDI dashboard is like your company’s B2B messaging cockpit, providing visibility of all automated exchanges and allowing relevant individuals to access and edit information easily. Without a good EDI dashboard, management of automated B2B communication can be complicated. With one, it’s a piece of cake!

In this article we’ll explore what makes an efficient EDI dashboard. Hopefully by the end you’ll know exactly what to look for when selecting a new solution.

Data visibility

The main job of any dashboard is to make information accessible and easily digestible. A good EDI dashboard can achieve this by providing…

1) Full transparency for all departments

Given the technical work involved in managing EDI connections, access to EDI data in companies is often limited to the IT team, or a small number of EDI specialists. But EDI data is relevant to many different teams, and providing access to relevant individuals such as those in Purchasing or Accounts can help to streamline processes and eliminate bottlenecks.

2) Full-text search functionality

In a good EDI portal finding transactions and documents should be as quick and easy as possible. Given that not everyone looking for information in your portal will necessarily be an EDI expert (especially if several teams are granted access), it’s important that your EDI dashboard has an intelligent search functionality. Rather than requiring users to manually scroll through data or enter specific message identifiers, the best EDI portals will allow users to locate relevant data quickly using any relevant keywords.

Message overview in the ecosio.monitor Message overview in the ecosio.monitor

3) Detailed EDI analytics

Just as the dashboard in your car displays all the key information you need in one place, so your EDI dashboard should too! When you’re exchanging high volumes of messages with partners, it’s important to be able to identify any issues quickly. A good EDI dashboard should make this possible via helpful real-time graphs and EDI analytics. When errors do occur, the error information should also be thorough, so as to facilitate swift resolution.

Example of ecosio.monitor dashboard analytics overview
Example of ecosio.monitor dashboard analytics overview

Flexibility

Behind data visibility, the next most important attribute of any good EDI portal is flexibility. Although there are only so many ways to conduct EDI, every company’s EDI requirements are different. Plus requirements naturally change over time! As a result, it’s important that your EDI dashboard has sufficient flexibility to allow your EDI solution to continue to deliver no matter what your specific situation is.

Key things to look for here include…

Customisability

Ideally a good EDI portal should provide ways for individuals to tailor processes to meet their needs. For example, the ability to control notifications can be particularly useful, and help ensure you are only alerted about what’s important to you.

Extensibility

The ability to integrate your dashboard with other solutions, such as a Web EDI portal, will ensure you are able to adapt as needs evolve.

For example, in addition to being compatible with all ERP systems, ecosio’s EDI dashboard (the ecosio.monitor) can be integrated with all ecosio products, from our e-invoicing solution to our Web EDI portal.

Management tools

With any platform or software which is accessible to many individuals, being able to manage usage is important. There are two areas to consider here…

1) Management of internal teams

In order to manage internal teams efficiently, it’s extremely useful to be able to control access and edit user permissions.

Another feature that many EDI professionals find helpful is having real-time visibility of which users are active, as this can enable faster issue resolution.

2) Management of external partners

Depending on your partner and supplier landscape, it may also be helpful for your EDI dashboard to enable you to manage access and functionalities for external entities. For example, this can be a useful feature for businesses wishing to control the access of ERP partners, and for larger organisations with sub-companies.

Good support

As support is not technically a feature, it’s something that many people overlook when selecting an EDI dashboard. However, having reliable support is crucial – particularly for those businesses without substantial in-house EDI expertise.

With this in mind, it’s worth looking out for the following when considering your options…

Reachability of support

Most solutions will provide a support number and/or email address for users to contact when an issue arises. However, these methods of contacting support aren’t optimal. A much better method is being able to raise tickets within your dashboard. Not only does this allow your colleagues to see that a ticket has been raised, it also makes it easier for the expert to see the relevant information, leading to faster resolution and better transparency for all.

Example of support ticket functionality in the ecosio.monitor
Example of support ticket functionality in the ecosio.monitor

Proactive EDI portal maintenance

If optimal system performance is to be maintained, updates need to be proactive rather than reactive. If maintenance is left to internal teams to handle, it’s easy for maintenance to be put off and performance to deteriorate over time.

Security

Given the significance and sensitivity of the data being exchanged via EDI, it’s important that your EDI dashboard is sufficiently secure. Features that can help bolster security include…

User authentication

Obviously, you don’t want anyone accessing your EDI data who shouldn’t be, and the easiest way to prevent this is through thorough implementing failsafes such as multi-factor authentication. Meanwhile, Single Sign-On (SSO) and editable user preference settings, including “remember me” functionality, can be used to enhance the user experience.

Secure archiving

Archiving is not only a legal requirement in many transactions, it’s also essential for maintaining data integrity. While all EDI solutions should offer archiving, a good EDI portal should make this as easy as possible by providing user-friendly management features.

The ecosio.monitor offers the ability to create custom archives The ecosio.monitor offers the ability to create custom archives

Regular updates

Regular updates are essential for long-term efficiency and will prevent a gradual decline in performance and security. As mentioned previously, it is best if technical updates are handled proactively by external experts.

Have you considered the ecosio.monitor?

Now that you’ve got a clearer idea of what a good EDI dashboard can deliver, you should be better placed to decide on a suitable solution. And luckily you don’t have to look far to find one!

If you’re searching for an EDI portal that offers impressive data visibility, flexibility, robust management tools, good support and top-notch security, you need look no further than the ecosio.monitor.

Thanks to deep integration into your existing ERP system, the ecosio.monitor offers unparalleled usability and data visibility, allowing users to view real-time message statuses and find relevant data within seconds. Plus access can be extended to and adjusted as required, ensuring EDI never becomes a bottleneck.

Find out more!

For a detailed breakdown of the ecosio.monitor’s key features and how these can benefit you, please visit our dedicated feature page.

Alternatively, if you would like to schedule a call to see first hand what our EDI portal can do and how the ecosio.monitor can be integrated with your existing systems, contact us today. We’d love to show you how our solution can help you achieve maximum efficiency with minimum effort.

Frequently asked questions

Why is an EDI dashboard important?

An EDI dashboard is essentially your very own EDI control centre. An efficient dashboard makes keeping track of EDI message traffic and identifying and eliminating errors easy. For large businesses a comprehensive, flexible dashboard is an invaluable tool in helping to streamline key B2B processes and communication.

Is changing EDI dashboards difficult?

How much work it takes to upgrade your EDI dashboard depends on several factors, including what type of EDI solution you currently have, which dashboard you want to implement, and how much EDI expertise you have in-house. While some EDI migration projects can be lengthy and complicated, if a fully managed solution (such as ecosio’s) is opted for, all technical tasks are handled quickly and efficiently by external experts, and migration becomes simple.

How important is usability in an EDI portal?

Extremely important! EDI data is typically relevant to many different teams within a business. For some individuals interacting with EDI data may be something that is only required very rarely. As a result, your EDI portal shouldn’t require detailed technical knowledge or familiarity with a unique system. Ideally, the user interface should be in line with that of your existing ERP system. Features, folders and pages should be clearly labelled, and a flexible search function is crucial.

Can I see a demo of the ecosio.monitor in action?

Yes! We would be more than happy to show you what our EDI monitor looks like and how its many unique features can benefit your business. To arrange a demo please contact us.

Discover more about our updated product, ecosio.flow.

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EDI Invoicing: Common Questions Answered https://ecosio.com/en/blog/edi-invoicing-common-questions-answered/ Tue, 09 Jan 2024 09:50:30 +0000 https://ecosio.com/?p=63531 Automated invoicing, otherwise known as EDI invoicing, is becoming increasingly important in modern commerce. Businesses today are demanding more granular data from one another than ever before. Meanwhile, across the world, expectations regarding data transparency and speed are rising rapidly, and governments are introducing complicated e-invoicing legislation. But what exactly is EDI invoicing, how does […]

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Automated invoicing, otherwise known as EDI invoicing, is becoming increasingly important in modern commerce. Businesses today are demanding more granular data from one another than ever before. Meanwhile, across the world, expectations regarding data transparency and speed are rising rapidly, and governments are introducing complicated e-invoicing legislation. But what exactly is EDI invoicing, how does it work, and what makes a successful solution?

In this article we answer some of the most common questions in order to help you make the right choices moving forwards.

What is EDI invoicing?

EDI invoicing refers to the electronic exchange of invoice information between business partners using standardised electronic file formats. 

Unlike traditional paper-based invoicing or PDF invoicing via email, EDI invoicing is a fully automated process. Relevant data is first converted to an agreed, computer-readable format, and sent via a secure protocol to the recipient. The recipient’s system then decodes the message and stores the data in the appropriate place in their ERP system. Crucially, this process happens instantly and requires no manual data input, meaning it is both fast and reliable

How difficult is EDI invoicing?

Implementing EDI invoicing poses various challenges, and as such demands careful consideration and planning. 

The most technically challenging hurdle is setting up the technical connections, as this requires expertise in electronic communication protocols and data formats. In order to minimise the potential for errors, it’s important that the mapping stage in particular is thorough and includes comprehensive testing. If this stage is rushed or overseen by inexperienced individuals, the efficiency of the solution will suffer.

Another aspect of EDI invoicing that is difficult to manage is keeping track of relevant legislation. E-invoicing regulations not only differ from country to country, but are also constantly being amended, and given the consequences for non-compliance can be severe, it’s important to keep your system up-to-date.

Integrating your solution into your existing ERP system is another hurdle that many struggle with. For an EDI invoicing solution to be successful it’s important that relevant teams can access data quickly and easily – ideally via a user interface that they are already familiar with. If access is limited to a few individuals or data is hard to locate, invoicing processes will quickly become a bottleneck.

Thankfully, however, a good invoicing solution can handle all of these challenges… and as we will see in the following section, will also deliver many benefits.

Why should businesses consider implementing EDI invoicing?

Whether or not e-invoicing is mandatory where you operate yet, implementing an efficient EDI invoicing system is a good idea thanks to the plethora of benefits the technology offers, including…

  • Increased efficiency: Automation of the invoicing process leads to quicker processing and payment, reducing manual errors.
  • Cost savings: EDI invoicing enables businesses to save money by streamlining processes, reducing paperwork, and minimising errors.
  • Reliability: Automated invoicing ensures standardisation of information and greatly reduces the risk of messages being lost.
  • Improved data visibility: B2B e-invoicing makes finding and storing invoice information easy. The best solutions also utilise APIs in order to allow users to see message statuses in real-time.
  • Better partner relations: The more advanced your system, the better placed you will be to meet the needs of partners and demand additional data from them.

For a more thorough breakdown of the benefits that e-invoicing can provide, feel free to download our stat-filled infographic on this topic.

What are the most common mistakes when implementing automated B2B invoicing?

Implementing an EDI invoicing solution is a complicated process. With so much technical work involved, there is a lot that can go wrong. Most issues, however, can be traced back to one of the following three common mistakes:

  1. Failing to plan: Unfortunately the most common approach when it comes to implementing a new EDI invoicing system is to put it off for as long as possible, and then rush the ultimate project. Unsurprisingly this is not a successful strategy. Rather than having your timelines dictated by external factors, it is best to assess your requirements and conduct research proactively.
  2. Overestimating internal capability: Setting up and maintaining a successful EDI invoicing solution requires both time and technical expertise. Many businesses simply assume their IT team can handle the job and end up struggling with errors and compliance issues as a result.
  3. Not prioritising flexibility: Given the pace of change when it comes to B2B process automation, and invoicing automation in particular, having a solution that can adapt is crucial. It is no longer enough for your solution to be able to cope with your current invoicing requirements. It must also be able to accommodate evolving partner requirements, geographical expansion, new legislation and technical developments. Without such flexibility, your EDI invoicing solution will quickly become a bottleneck.

Which industries benefit most from EDI invoicing?

While virtually every industry can benefit from EDI invoicing, the industries likely to benefit most financially are those in which high numbers of orders and invoices are exchanged on a daily basis. For example, GS1 UK has estimated that the UK grocery industry alone saves around £650 million every year thanks to EDI. 

However, cost benefits are not the only benefits that matter. For example, the reliability and efficiency offered by EDI invoicing is invaluable for many industries, particularly the automotive, pharmaceutical, and logistics industries. Similarly, the message traceability offered by EDI is hugely useful to certain industries.

What are the options for integrating e-invoicing?

There are three main ways that businesses can integrate EDI invoicing with their existing systems. They can opt for local EDI software, a software as a service (SaaS) approach, or a fully managed “e-invoicing as a service” solution.

Which option is best for you will depend largely on your capacity to handle EDI work in-house. For more information on how much internal work is required to operate each of these three solution types, see our downloadable infographic on this topic.

Is EDI invoicing secure?

Yes, EDI invoicing is secure. In fact, it’s more secure than virtually every other method of B2B communication! A key reason for this is that EDI invoicing relies on encryption and authentication to ensure data protection. This means that senders can be sure messages won’t be received by anyone other than their intended target.

In particular, digital signatures play a crucial role in enhancing data confidentiality and ensuring the authenticity, integrity, and non-repudiation of the information in EDI invoices. Digital signatures use asymmetric key cryptography, where a private key is used to create the signature, and a corresponding public key is employed to verify its authenticity.

Moreover, the most popular EDI protocols used to exchange the messages, such as AS2 and SFTP2, also offer impressive security features.

What are the key features of a successful EDI invoicing solution?

On the face of it, the job of an EDI invoicing solution is simple – transport data from A to B quickly, accurately and securely. However, some invoicing solutions are far more effective at doing this than others. The three main areas in which good and bad invoicing solutions differ are as follows…

  1. Technical capability. As every business has different requirements, a good EDI invoicing solution should be able to send and receive messages via a wide variety of different protocols and formats. In particular, it’s essential that your solution can exchange messages via the Peppol network, as Peppol’s usage is growing year on year and is mandated by many countries for e-invoicing.
  2. ERP system integration. The best EDI invoicing systems can be integrated directly into your existing ERP system. As well as making the solution easier to use (as the system is already familiar to users), this also improves data visibility and makes error correction simple. For example, ecosio’s e-invoicing solution utilises an API connection to provide users with end-to-end message visibility. Plus, thanks to the nature of the integration, users can also locate messages instantly via a powerful full-text search functionality.
  3. Flexibility. As we’ve already covered, not prioritising flexibility is one of the most common mistakes that businesses make when selecting an EDI invoicing solution. It is virtually impossible to know what your technical requirements will be in one or two years, let alone further into the future. From legislative developments and evolving industry standards to an evolving partner landscape, a lot can change, and having an invoicing solution that can cope could be the difference between growth and stagnation. Beyond simply supporting growth, an industry-leading solution such as ecosio’s can actively stimulate it.

What does the future hold for EDI invoicing?

As automation becomes increasingly central to business processes and countries introduce more complicated e-invoicing regulations, having a reliable EDI invoicing solution will be extremely valuable moving forward. 

But invoicing is only one small corner of B2B communication. Ultimately it’s only a matter of time before automation is expected across all B2B processes, from ordering to logistics. And while it’s impossible to say exactly how new technologies such as blockchain, AI and RPA will impact developments in the B2B integration space, one thing is certain – EDI and e-invoicing are going nowhere anytime soon.

Want to see how ecosio’s EDI invoicing solution could benefit you?

For more details on ecosio’s unique E-invoicing as a Service approach and how it could help you to make invoicing effortless, get in touch today. We’ve helped hundreds of businesses to transform their B2B integration processes and would love to help you do the same!

Want to stay up-to-date with e-invoicing news?

Sign up to our bi-monthly newsletter and get a rundown of recent e-invoicing developments, plus useful e-invoicing assets straight to your inbox.

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The AS2 EDI Protocol Explained https://ecosio.com/en/blog/the-as2-edi-protocol-explained/ Mon, 20 Nov 2023 09:05:15 +0000 https://ecosio.com/?p=63129 🔍 TL;DR summary AS2 (Applicability Statement 2) is a protocol used to exchange business data safely and securely via HTTP, making it one of the most popular methods for EDI message exchange with partners Today the AS2 EDI protocol is increasingly recognised as the most reliable and attractive way for businesses across industries to exchange EDI […]

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🔍 TL;DR summary

  • AS2 (Applicability Statement 2) is a protocol used to exchange business data safely and securely via HTTP, making it one of the most popular methods for EDI message exchange with partners
  • Today the AS2 EDI protocol is increasingly recognised as the most reliable and attractive way for businesses across industries to exchange EDI messages
  • AS2 operates over HTTP and is optimised for secure EDI transmission, providing a standardised method for structured data exchange
  • AS2 ensures data integrity and confidentiality through encryption, digital signatures, and message disposition notifications (MDNs)

Applicability statement 2 – more commonly referred to as AS2 – is a protocol which is used to exchange business data in a safe and secure way via HTTP. Today the AS2 EDI protocol is one of the most popular ways that businesses exchange EDI messages with their partners.

In this article we’ll explore how the AS2 protocol works and why it is so popular in the EDI sphere.

AS2’s growing usage

On the face of it, AS2 is simply one of a number of different protocols that are available to businesses when it comes to exchanging EDI data with one another. However, AS2 is increasingly being recognised as the most reliable and attractive EDI protocol for businesses across all industries. 

The reason for AS2’s impressive reputation can be boiled down to three key benefits that it offers users:

  • Security

When messages are sent via AS2 they are encrypted by the sender and have to be decrypted by the receiver. This provides a layer of security that is crucial given the business-critical nature of the information being exchanged. 

  • Transparency

When using AS2, the sender will always get an acknowledgement notifying them if their partner has successfully received the message or not. Plus every message has a unique identifier, which makes tracing very easy.

  • Convenience

AS2 is extremely popular with large supply chain organisations. In the retail sphere, for example, Walmart, Amazon and Migros all require suppliers to use AS2 – with Walmart having done so since 2002. This has had a knock-on effect on supply chains across the world, meaning AS2 is now the logical choice for customers and suppliers alike. Moreover, the fact that AS2 uses HTTP to exchange messages is also beneficial, as HTTP’s own popularity and high level of standardisation makes debugging simple.

What are the key attributes of the AS2 protocol?

Keys and certificates

One central feature of the AS2 protocol is the use of keys. In AS2 exchanges, sender and receiver have both a public and private key. These public and private keys are mathematically related, with the public key being calculated using the private key. 

Public keys are meant to be shared with partners, and allow recipients to verify message authenticity without requiring the sender’s private key. If the system just required each party to have a public key, there would be no way to verify that a message wasn’t sent by a fraudulent party. 

In AS2 exchanges, a certificate contains the public key of a party, together with a signature, which can be made using the private key of a trusted certificate authority (CA).

Key stores

Key stores are containers that hold several private keys and certificates. Two common use cases of containers are identity stores and trust stores. The first holds a private key with the corresponding public certificate. The latter holds a set of certificates, e.g. from CAs. 

Key stores are usually single files with different extensions. Common extensions are .jks (Java Key Store) and .p12 (present industry standard).

Encryption

Data encryption is a key aspect of the AS2 protocol as it ensures the security of the data being transmitted. In exchanges sent via AS2 the sender encrypts the payload with the public key of the receiver. This ensures that only the receiver (who has the relevant private key) can decrypt the message.

Most commonly used AS2 encryption algorithms = Triple DES (3DES) and AES-256 (both state-of-the art encryption algorithms)

Digital Signatures

In addition to encryption, AS2 also uses digital signatures, which allow the user to guarantee the authenticity of the sender/receiver. First, the sender signs the payload with a private key. The receiver then verifies the origin and authenticity of the message using the sender’s public key.

Most commonly used AS2 signature algorithms = SHA1, SHA256 and SHA512

Acknowledgements

In AS2 EDI exchanges, a Message Disposition Notification (MDN) serves as an acknowledgement of the message transfer to ensure non-repudiation. It is a digitally signed receipt of a file which is received by the recipient and sent back to the message sender.

Hash Function / MIC

The message integrity check (MIC) is connected to the MDN, and ensures the integrity of the message content. It is calculated with a secure hash function over the payload. The receiver calculates the MIC over the received payload and sends the MDN, including the MIC value, back to the sender. If the returned MIC value equals the original calculated MIC value, the payload is an integer.

How AS2’s secure transmission loop works

The diagram below shows how a message is transmitted from sender to receiver, and how the receipt of the message is communicated back to the sender.

AS2 EDI secure transmission loop

[click to enlarge]

On the sender’s side…

1) The message integrity check (MIC) is completed using a secure hash function. 

2) The sender then digitally signs the message content with their private key and the file content (including the signature) is placed in a MIME message. 

3) The MIME message, which includes the file content and the digital signature, is encrypted using the receiver’s public key (certificate). 

4) Before the data is transmitted via HTTP, specific AS2 EDI headers are added, e.g. AS2-FROM and AS2-TO. Additionally, a request for the return of a signed receipt is requested.

On the receiver’s side…

5) The message AS2 headers are checked to verify if sender and receiver are correct.

6) The receiver then decrypts the message with their private key.

7) To verify the sending partner (and that the payload wasn’t changed), the signature is verified with the sender’s public key (certificate). If both steps are successful, the integrity of the data and authenticity of the sender can be guaranteed. 

8) The receiver returns the signed receipt as confirmation (MDN). This receipt contains the hash value of the message (MIC). Therefore, the sender has confirmation of the proper authentication and decryption of the receiver. The MDN is also transmitted via HTTP, either synchronously during the same session or asynchronously within a different session than the sender’s original session.

Back on the sender’s side…

9) The signature of the MDN is verified with the receiving partners certificate, confirming that the MDN was digitally signed.

10) The MDN is stored for non-repudiation or troubleshooting purposes.

Setting up an AS2 EDI connection

Before you can start exchanging messages via AS2 with partners, it is necessary to complete several steps. The first and most important of these is setting up the relevant AS2 software. 

Software setup

For businesses in this position there are three distinct approaches to choose between: installing the software on-premise, installing via the cloud, or opting for a Software as a Service (SaaS) solution.

1) Installing on-premise 

Traditionally, on-premise installation has been the most popular approach for achieving AS2 compatibility (be it on company servers or virtual machines).

Pros
  • Simple to meet data localisation requirements
  • Tight integration with internal systems possible
Cons
  • Expensive, especially when operational and maintenance costs are accounted for
  • Integration with cloud-based systems (e.g. Google storage) can be difficult

2) Installing via the cloud

A cloud-based approach offers a simple way to satisfy regulatory requirements while leveraging the flexibility and availability of the cloud. 

Pros
  • Excellent scalability and availability
  • Greater capacity for integration with cloud services
  • Lower cost than in-house installation thanks to much simpler operation and maintenance
Cons
  • Integrating with legacy in-house technology can be difficult

3) Utilising an SaaS provider

Using a SaaS provider offers a quick way to achieve AS2 EDI connectivity, with users able to sign up and configure AS2 settings themselves via a web interface. 

Pros
  • High potential for cost savings, particularly for businesses sending a low volume of messages via AS2, as payment is typically managed on a per use basis
  • AS2 connectivity can be achieved extremely fast
  • No maintenance or operational costs
Cons
  • Can be difficult to meet specific data localisation or network requirements. 
  • As with cloud-based installations, integration with in-house legacy technology may be tricky

Creating a partner profile

Once access to AS2 EDI software has been achieved (either via on-premise installation, the cloud or an SaaS solution) both you and your partner must provide the other with your AS2 identifier, URL and certificate. 

Both parties must then create a ‘Partner’ entity within the AS2 software using this information.

Testing

After partner profiles have been created, the next step is to test connectivity.  This is done by exchanging basic text files, which can then be verified for integrity by the receiver. During this stage it is also advisable to test the sending and receiving of MDNs.

The AS2 connection is deemed complete and validated only when both partners can exchange files successfully.

Final setup and go-live

Once testing has been successfully completed, the AS2 connection can be made live. 

Looking to experience the benefits of EDI with minimal internal effort?

Whether it’s setting up an AS2 EDI connection, handling complicated EDI mappings, or simply liaising with partners during onboardings, EDI processes can be technical and time consuming. 

Thankfully, however, effective EDI doesn’t have to be difficult!

At ecosio we understand the importance of successful, reliable EDI connections, and are passionate about helping our clients to experience EDI’s full potential. As we know that supply chain organisations don’t always have the time or expertise to integrate, run and maintain an EDI solution, we offer a fully managed service, allowing businesses to experience all the benefits of efficient EDI with none of the hassle.

With a single connection to ecosio’s cloud-based EDI solution (our Integration Hub), you can achieve hassle-free connections to all your partners, no matter how complicated your routing or mapping requirements. 

In short, we take care of all your EDI needs, from liaising with partners and setting up connections to message monitoring and error resolution, leaving you to concentrate on what you do best.

For more information, contact us today!

Der Beitrag The AS2 EDI Protocol Explained erschien zuerst auf ecosio.

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