The strategic benefits of EDI

There is almost no doubt that EDI can bring significant benefits to many organizations. There are many benefits, but take a step back and you can classify the benefits as strategic, operational and opportunity benefits. The extent of the benefit an organization enjoys will be based around why and what EDI services have been implemented.

Let’s take a look at the strategic benefits of using internet EDI for a business:

Faster trading cycles

Research has shown that 70% of all data entered by organizations were generated from another computer system. Simple moving from a paper based order system will see an immediate speed improvement. That speed improvement increases in an order of magnitude when other partners and vendors are also part of the same EDI network.

New business processes

Toyota popularized the just-in-time manufacturing process. With JIT, items required for manufacture are requested when an order arrives. This saves costs on storage and warehousing. With EDI, any organization can make the switch to a similar process faster and without much additional capital expenditure.

Retain customers

An increase in business efficiency like that provided by an EDI implementation will result in lower costs. These cost savings can be then passed on to customers by way of better service or lower item costs. This also applies with customer service. With inquiries about the status of an order a customer service rep can give the customer much more accurate information as most facets of the process will be online.