Siddeshwar Remma, an EDI / Data Integration Specialist at MIT Recourse LLC, writes a special column for DM about the new trend that is Cloud EDI.
The transformation of business technology is at a speed that we have never foreseen before. The emergence of new technologies is making things seem easier and more user-friendly. For decades, EDI has ruled the roost in B2B communication, helping companies exchange important documentation like purchase orders, invoices, and shipping notices with ease.
Traditionally these systems work more with on-premises infrastructure using servers to meet their needs. The new age transformation into the cloud is now revolutionizing how businesses are operating and collaborating, thus increasing the scope of scalability and cost management, saving hours of time.
The chunky, localized systems are being replaced with Cloud EDI, which is moving the heavy data exchange. The old system, in which companies had to invest in dedicated servers, bought hefty licenses for software and IT teams to ensure the smooth flow of data. Though this system had been efficient for ages, it has now become synonymous with a horsecart in the age of bullet trains. Cloud EDI gets the job done more effectively now. Using third-party providers, businesses can remove the extra load of maintaining hardware, updating the software (which takes a painful amount of time), and security patches.
The major challenge in traditional EDI was its scalability. It was all a strenuous and painful job of buying and upgrading systems, servers, and these processes took weeks and months which led to spending more money for the same. Leading to big losses during the time of holiday rush, where bandwidth becomes a challenge, and migration/upgradation of servers, the old system offers more sets of challenges to the businesses. The cloud adjusts in real-time, which needs no heavy machinery. Isn’t that a big drawback, where end users expect instantaneous results with no error pages and waiting times?
Cost is another aspect where Cloud EDI offers comfort. The inevitable consulting fees for stitching servers and software and manpower are always a big concern in the EDI world. We have to pay only the operational expenses instead. The subscription-based pricing leads us to have predictable budgets, avoiding any unexpected turnout. Especially for small players, this is going to be a bank saver. The final straw in the streak of challenges is always privacy and security, which is the single biggest threat to every kind of software setup throughout the world. Sensitive business data flying through the internet is always a bite that hackers always get attracted to. The top cloud EDI providers offer encryption, compliance, and real-time monitoring with an ease that most in-house IT teams can’t maintain. They have multi-layered firewalls, end-to-end encryption, and adherence to standards like HIPAA or GDPR.
Though it’s too early to comment on the Cloud EDI as foolproof, as nothing is safe on the internet, professional third-party services often have a way of successfully encountering software theft threats. The downtime in traditional EDI is one serious reason to discuss where it brings all the supply chains to a halt. Imagine a scenario where a retailer where every minute of delay is money bleeding out—that’s a game-changer.
The cloud EDI’s best offering could be collaboration, which will be boosted exponentially. Without worrying about loss of data, the cloud EDI connects every partner across the globe with no mismatched formats or protocols. It avoids any further chasing and hiccups between the partners with the availability of real-time visibility into transactions.
As every system comes with its set of challenges, integration becomes a hurdle where the companies may find it tough to hand over the control to a third party. Data migration is another pain point where moving years of records without loss of data takes a lot of planning and risks. In spite of the challenges, companies are ready to bite the bullet. Though the cloud EDI seems to be more of a fancy word, it’s a shift that’s much needed in the world of business tech. The cloud’s calling to the world for a changeover. Let’s embrace it.