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Business Management Systems – The Evolution of Capturing Data (Part 2)

Jan 11, 2018 9:03:00 AM / by David James Johnson

In the first part of The Evolution of Capturing Data we discussed the transformation from paper to ERP. The mantra had become capture the data early and capture the data once, so the question became how to capture data from external systems?

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For SMB the answers usually came from the enterprise companies. Starting as early as the 70’s these large companies developed Electronic Data Interchange (EDI) to facilitate transfer of information through a series of predefined formats for different transaction types. Whole systems were developed to transfer the data securely and ensure that the other party received it correctly. A whole industry of delivery companies, Value Added Networks (VANs) were formed to safely and securely deliver these documents which were formerly transmitted in paper form. The use of EDI proliferated with the use of the Internet. Now large companies could require their smaller trading partners to use EDI.

Although the cost of EDI came down to the Small to Midsize Business (SMB) market the complexity and cost can be daunting. Although there “standard” document formats defined

• The US standard ANSI ASC X12 (X12) is predominant in North America.

• The UN-recommended UN/EDIFACT is the only international standard and is predominant outside of North America.

• GS1 EDI set of standards developed the GS1 predominant in global supply chain

• The ODETTE standard used within the European automotive industry

• The VDA standard used within the European automotive industry mainly in Germany

• The HL7 a semantic interoperability standard used for healthcare administrative data.

• And the list goes on!!!!

What makes EDI even more frustrating to small business is that each “trading partner” may have customized the standard for their own unique purposes requiring a special map for sending or receiving data from that company. EDI often also has costs for transmission of data based upon number of transactions and/or the size of transaction data sent through the network

A variety of new methods have evolved for more direct connection between systems where the need for a third party has been eliminated. This also includes EDI systems which now can convert data into other formats and transmit in other secure methods. The most common way to connect with external systems is through an Application Programming Interface (API). An API is really a definition of how data is stored and can be accessed. These APIs may only be available locally or are often made available over the internet through a web service (Web API).

Web APIs may eliminate the need for a VAN or expensive EDI software, however, having data available is meaningless unless it is captured and stored properly. A whole new industry has evolved to manage data through APIs. These “middleware” tools have also been around for a while. Microsoft BizTalk Server first came out in the year 2000. Now companies like Dell with its Boomi service are providing middleware as a service, but all of these tools require development expertise to automate the capture data from one system and transfer into another.

I-BN has partnered with Fisher Technology to offer pre-packaged integration with its 2SimpliConnect cloud platform for pre-defined cloud to cloud integrations or custom integrations. With our integration platform, customers in the I-BN cloud experience integrations at approximately ½ the typical upfront cost for similar integrations and ongoing costs that are fixed and predictable when compared with EDI.

Although the automation of data capture from remote systems has become less expensive and easier than ever before, it is more often than not complex. For example, our most common form of integration is ecommerce web site order capture. This relatively straight forward task is often complicated by industry nuance such as

• vintage for a wine distributor,

• pedigree for a pharmaceutical company, or

• lot tracking for a flooring company.

With ecommerce the integration is often bi-directional for stock status, pricing and other data elements.

In the end the automation of data capture becomes more critical as a business grows. A web store with 10 orders per week has lower risk of error and lower cost of redundant data entry than one with 10 per hour. A business with one webstore has less cost savings than one with multiple eCommerce channels such as eBay, Amazon and a web store. The automation of data capture came as the need grew and volumes increased, and the methods evolved with as new technology becomes available.

 

Topics: evolution, EDI, Electronic Data Interchange, SMB, Business Management Systems

David James Johnson

Written by David James Johnson

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