The Importance of EDI
To stay competitive in today's global economy, businesses are being forced to re-evaluate the way they do business with their customers and their vendors. We cannot afford to close our eyes to advances in technology in the way many businesses have done in the past and continue to do even now. It is a question of do it or die in the competitive world of products and services where the well informed and the technologically equipped will reap the rewards of success. Our company is already behind others in technology and efficiency by not having EDI. Without EDI, our internal processes have poor response times, excessive paperwork floating around and potential errors that should not be necessary as well as wasting personnel time doing a work that could be automated.
When business begins to trade or share core information, the return of technological investment is clear and then we realize the true value of EDI. We should not stay behind our competitors and should start now a process of implementing EDI in our company, improving our efficiency and productivity, and reach higher levels of customer satisfaction. When EDI is used as a tool to enable process change and help achieve business goals, significant benefits can be reached. EDI enhances all parts of the business process, and we would expect some impacts, such as:
· Reduced Process-Time: the need to send and receive information is crucial in today’s business world. With EDI, data can be sent and received in seconds and 24 hours a day and 7 days a week, thus allowing business to continue outside the normal business day, and the turnaround time for a business transaction can be reduced from days to hours and, in some instances, to minutes or even seconds.
· Increased Efficiency: the major part of data entry tasks is generated from a computer. When companies develop compatible electronic documents, data is never copied, re-keyed, or manually filed, freeing employees for more important activities, eliminating tedious work and reducing the risk of human error.
· Optimized Inventory: managing inventory is a critical issue for any business. EDI can provide faster and more accurate information about production, buying and delivery needs. It is a link between customer, seller and vendor thus leading to improved inventory management and reduction in inventory levels.
For initial EDI projects, limited objectives with perceivable benefits should be our first step.
This has increased efficiency and consistency as well as made it possible to apply some of the business strategies like just in time to solve the manufacturing process issues.
Technological developments and improvements have allowed for businesses to communicate information faster and better by the use of email, live chats, and video teleconferencing. These enhancements allow for a faster flow of information in which a business can easily distribute and receive responses in real-time from its customers. It helps employees to function more efficiently by using software programs such as word processing, spreadsheet tools, statistical analysis software and computer aided design programs. With the growth of the internet and social media, businesses expose its products to a larger customer base. Others advances such as inventory management software are able to track and fill orders, and replace stock when the volume fails a pre-determined quantity at much faster rates. Digital storage of documents and information on servers and multi-media storage
Harkness, W. L. (1996, Sep). Process Improvement and Innovation in the Information Services Function: Lessons Learned at the Bose Corporation. pp. pp.349-368.
Highly competitive environment and need of innovation, the companies are facing high pressures to innovate and improve the business process. As IT budgets are limited, process owners and IT departments need to decide how to divide their spending on efficiency and flexibility enhancing IT capabilities to optimally support the execution of business processes. The limited IT budgets put pressure on IT process owners to find the perfect mix to achieve the efficiency and flexibility to support smooth execution of business processes (Heckmann, 2015). IT departments need to find the right balance to use IT budget and decision making ability and play their role in maximizing the organization’s revenue.
The main idea is to choose a manageable area within the department of choice and refine the practices and procedures before going company or enterprise wide. The organization will also use this time to determine how best to configure the various EDMS products to meet unique requirements. Of most importance is to configure, not change the way in which people work. The EDMS product set should be both highly configurable and extendable and in most cases will contain a superset of the functionality the organization will require.
Information technology is part of every corner in any organization. Employees use electronic mail, (VOIP) telephone systems to communicate. Electronic data interchange (EDI) is used to send out and receive data including orders and payments from one company to another. Servers process information and store large amounts of data. Desktop computers, laptops, and wireless devices are used to create
In the beginning, businesses used information technology for automating the processes primarily to reduce labor costs. Subsequently, information technology is used for delivering information with speed and accuracy.
The purpose of implementing an ERP system in a company is when the company isn’t operating efficiently. Look at it like this, when your body is sick, you know you need to take medicine, you just can’t stand the taste. And in the same matter when your company isn’t operating efficiently, you’ve got to take steps to correct it. Most companies just fear the disruption, the learning, and the cost and the inconvenience of it all. “Another way to look at or understand ERP is cars have dashboards so the driver can get to where he or she wants to go. Airports have control towers to make sure everything and everyone gets to where they need to be. All of your typical individual machines have control panels so you can make them do what they are supposed to do”. (Jones, W (2006, 01). Roadmap to Fusion: Engaging Oracle Consulting on the path to your next business platform. Orcacle Corporation World Headquarters,)
Inventory management is a method through which a business handles tangible resources and materials to ensure availability of resources for use. It is a collection of interdisciplinary processes including a full circle of the demand forecasting, supply chain management, inventory control and reverse logistics. Inventory management is the optimization of inventories of manufactured goods, work in progress, and raw materials. According to Doucette (2001) inventory management can be challenging at times; however, the need for effective inventory management is largely seen more as a necessity than a mere trend when customer satisfaction and service have become a prime reason for a business to stand apart from its competition. For example, Wal-Mart’s inventory management is one of the biggest contributors to the success of the company; effective and efficient inventory management is of critical importance.
Effectively integrating information technology (IT) into an organization’s business processes is critical if the organization wants to increase productivity and remain profitable. IT includes items such as the systems software, application software, computer hardware, and the networks and databases that help manage the organization’s information. When implementing quality standards and processes that are forever changing in the IT world, organizations must balance these changes while continuing to rapidly implement new systems technologies in order to stay competitive.
IT experiences many benefits as well. Some of these benefits are that goals and objectives are more clearly stated, less rework occurs because of better communication and oversight. EA allows IT to deliver projects more rapidly, because constant business alignment ensures they are staying on track. EA also frees IT personnel to work on operation specific projects and innovations. More efficiency may encourage more innovation in the IT department and strengthen the technology infrastructure that can deliver cost effective results.
Instead of embedding outdated processes in silicon and software, we should obliterate them and start over. We should “reengineer” our businesses: use the power of modern information technology to radically redesign our business processes in order to achieve dramatic improvements in their performance” (Hammer, 1990).
Computers are forever present in the workplace. Word processors-computer software packages that simplify the creational and modification of documents-have largely replaced the typewriter. Electronic mail has made it easy to send messages worldwide via computer communication networks. Office automation has become the term for linking workstations, printers, database system, and other tools by means of a local-area network. An eventual goal of office automation has been termed the 'paperless office.' Although such changes ultimately make office work much more efficient, they have not been without cost in terms of purchasing and frequently upgrading the necessary hardware and software and of training workers to use the new technology.
E-business and e-commerce are terms that are sometimes used interchangeably, and sometimes they are used to differentiate one vendor’s product from another. In both cases, the e stands for "electronic networks" and describes the application of electronic network technology - including Internet and electronic data interchange (EDI) - to improve and change business processes (Bartels, 2000)
Advances in technology have changed businesses dramatically, in particular the communication and information technology that are conducted in firms, which changed the appearance and pace of businesses over the past few decades. ICT in particular, has evolved a lot over the past 30 years; important information can be stored in computers rather than being in drawers enabling information to be transferred at a greater volume and speed (Guy, 2009). ICT has also expanded various forms of telecommunications and workload conducted in businesses, internet examples of this include: e-mails can be used to communicate with others...