Importance of Value Addition in Network Over EDI
Way back earlier, commerce used to happen with just words of mouth, and then it is replaced by the white paper agreements. They too, later on, came out with disputed arguments as a result in some cases. Stamps on the agreement then arrived as a solution to such disputes and made the exchange a bit more reliable.
Electronic media now has created a big revolution in the industry by replacing traditional methods of exchanging data. It is surveyed that more than 50% of the companies use EDI technology today. The edi service providers play a vital role in giving a whopping rise in the rate of commerce within the organization.
Why is data exchange even important?
Data exchange is a vital necessity for businesses to process and proceed both simultaneously and also to rely upon each other. Without an exchange, no business can trust the other and the overall rate of commerce would fall down to a significant level.
The cloud computing consulting services have solved the problem of physically sharing the documents and have accelerated the pace of work within the enterprise industry but, there exist some segments that require even more security assurance and better encryption than just what cloud provides.
VANs are usually helpful in a network full of multiple consumers. As it helps you not keeping each one’s data specifically and allows you to process or set up the connection with them.
What are the documents usually exchanged between organizations?
There exists multiple crucial information in either documented form or in the PDF format. The variety of information-based data includes-
- Purchase orders
- Registration forms
- Certificates, etc
What does Value addition in Network mean?
Data exchange in EDI is possible through the landline or telecommunication cables. Now, if simply put, the arrangement of privacy for the two concerning companies to protect their data in between the path of exchange is termed as value added to the network.
You may also understand it in this way, as when there is no intermediate party that takes a responsibility to secure your data meanwhile the path of exchange in between the communication, then it is just a connection for data exchange. However, when there is a third party that takes care of the value addition, it is called an EDI based on a value-added network.
The value addition not just refers to the safety of data but it has numerous other purposes to fulfil such as-
- Auditing the data for correction
- Auditing the data for EDI standards
- Modifying the data (either conversion)
Now you may be wondering who are those third party or intermediate personnel who can even manipulate the data if it is inappropriate for exchange?
Here is your answer. The value addition can be done by either in-house or external research and development people who are coordinated with the organization for the same purpose. They understand the value of data exchange and the exchange standards often termed as EDI standards without which the data exchange is not considered well-secured and appropriate for exchange.
How EDI & VAN influence a business?
A mailbox type of delivery system at which the recipient finds its data sent by the sender and sends it back to the same. A VAN-based EDI is a closed network that allows the concerning companies only to exchange the data. It helps a business to communicate faster by not requiring to physically meet and exchange the requisite data.
There exists multiple VAN or value-added networks including
Depending on the size of the business or the concerning entities, the type of EDI-VAN has to be deployed. As a one-to-one business hires the initial one. But a business with more than one client or consumer would go for one-to-many.
Usually, the mid-sized IT consulting companies or brokers that work as financial analysts which usually have more than a thousand clients would possibly deploy the latter one. However, there are more such aspects that you must realize for deploying an EDI based on a value-added network.
Make sure to hire the best edi mapping services as the translation of data often becomes one of the biggest issues for those who deploy ordinary edi services without having detailed information regarding EDI deployment.
Read more: Top EDI trends to watch out for in 2020
What is EDI without VAN?
It is often termed as direct EDI. In this, you would not find the intermediate body which keeps on regulating the data over its appropriateness. Only the peer-to-peer exchange of data occurs without having the data audited or modified as per the standards of the EDI set.
It is cheaper than the other of course, but just with EDI services, you would rather have to hire numerous personnel for the same input that VAN would have put at just a one-time investment.
You may require a consultant from edi service providers for edi integration with the in-house ERP solution as you have not embedded the value-added network into your EDI communication. This deployment consultant for edi integration services would again cost you almost equal but keeps you with a hustle and bustle to deal with the consultant for every exchange.
Human data entry in the absence of VAN would lead to frequent human errors that would affect real-time commerce and its rate of exchange.
An organization without EDI based on a Value-added network is an orthodox commerce tradition where one-to-one physical interaction does still exist. However, having an EDI-VAN solution offers advantages and allows the organization to enhance the rate of commerce as well as communication irrespective of the distance or orientation of the two entities or whatsoever the number of concerned recipients are.
Value-added networks provide a stable, authentic, credible, secure, and smarter exchange of information with just an initial setup cost but save you not only with human capital investment but also with the most valuable asset i.e. time. It may sound vogue but time is still and will always be the second name for money.
It is comprehensive that the entire world is advancing, so we should too. As EDI integration services nowadays are being tried to be superseded by API integration services but still EDI custom development solutions have a lot to serve. It is estimated that more than 90% of EDI users choose to get the custom EDI solutions developed for their quick data exchange.