Efficient electronic business transactions
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  • 1. B2B/EDI integration for efficient electronic business transactions Ivan Vaklinov [email_address]
  • 2. ERP Systems & efficiency
    • Enterprise Resource Planning (ERP) system is an integrated computer-based application used to manage internal and external resources.
    • Tangible assets
    • Financial resources
    • Materials
    • Human resources
    • Needed by any large
    • organization
  • 3. ERP systems & Communication
    • ERP systems need to efficiently communicate with the outside world in a global economy.
    • Manual data entry
    • Product differentiation issues
    • Automation needed for any large document traffic
    • Vendor lock-in and need for interoperability standards
  • 4. B2B & EDI
    • EDI (Electronic Data Interchange)
    • Standard for the electronic exchange of commercial documents.
    • Computer-to-computer exchange of structured information, with a minimum of human intervention
    • Business to Business integration (B2B)
    • Commerce transactions between businesses
    • Usually via modern Web technologies such as SOA, Web Services etc.
  • 5. B2B/EDI scenarios – I
      • Between large businesses equipped with ERP systems that possess automatic communications capabilities.
  • 6. B2B/EDI scenarios – II
      • Between a large company and many small suppliers with a communications capability (Hub & Spoke)
      • Between a large company and many small suppliers with no automation (Web, Fax etc.)
  • 7. History of EDI/B2B
    • 1960s-1970s USA
    • 1980s - standardization efforts
    • 1990s – The internet and beyond
    • 2000... - SOA & Web Services
  • 8. EDI Standards – flat files Flat Files are textual data with fixed length fields typically used by legacy ERP systems (e.g. SAP) EDI_DC40 3000000000003905072620 3014 E2EDK01005 300000000 E2EDKA1003 300000000 E2EDKA1003 300000000 E2EDKA1003 300000000 E2EDKA1003 300000000 E2EDKA1003 300000000
  • 9. EDI Standards - EDIFACT United Nations/ E lectronic D ata I nterchange F or A dministration, C ommerce and T ransport (UN/EDIFACT) is the international EDI standard developed under the United Nations (1980s ...) UNB+IATB:1+6XPPC+LHPPC+940101:0950+1' UNH+1+PAORES:93:1:IA' MSG+1:45' IFT+3+XYZCOMPANY AVAILABILITY' ERC+A7V:1:AMD' ...
  • 10. EDI Standards – ASC X12 ASC X 12 - U.S. national standards body for the development and maintenance of Electronic Data Interchange (EDI) standards. 1979s... ISA*00* *00* *01*RECEIVERID *12*SENDERID *100325*1113*U*00403*000011436*0*T*>~ GS*FA*RECEIVERID*SENDERID*20100325*1113*24712*X*004030~ ST*997*1136~ AK1*PO*142~
  • 11. EDI Standards – TRADACOMS TRADACOMS – Developed in the UK in the early 1980s STX=ANA:1+5000000000000:SOME STORES LTD+5010000000000:SUPPLIER UK LTD+070315:130233+000007+PASSW+ORDHDR+B' MHD=1+ORDHDR:9' TYP=0430+NEW-ORDERS' SDT=5010000000000:000030034' CDT=5000000000000'
  • 12. EDI Standards – XML XML – E x tensible M arkup L anguage (set of rules for encoding documents in machine-readable form) <Order Number=”4325432543”> <Sender> <Address>Main Str. 25, London</Address> </Sender> <LineItem> <Product> <Name>Rolls-Royce</Name> ...
  • 13. EDI Standards - others
    • A number of standards were developed in the 1980s in Europe ASIA etc. More modern sub-standards exist as variants of XML
    • VDA – German automobile industry
    • EIAJ/CII/HWSW - Japan
    • GS1 XML
    • ebXML
  • 14. EDI Standards organizations - I
    • EDI standards may be drafted at indurtry, national or international level
    • UN/CEFACT - United Nations Center for Trade Facilitation and Electronic Business - http://www.unece.org/cefact/
    • ASC X12 - Accredited Standards Committee (ASC) X12, chartered by the American National Standards Institute - http://www.x12.org/
  • 15. EDI Standards organizations - II
    • EDI standards may be drafted at indurtry, national or international level
    • OASIS - Organization for the Advancement of Structured Information Standards - http://www.oasis-open.org
    • GS1 (EANCOM) - association dedicated to global standards to improve the efficiency of supply and demand chains
  • 16. EDI Standards organizations - III
    • EDI standards may be drafted at indurtry, national or international level
    • VDA - Verband der Automobilindustrie e., is a German interest group of the German automobile industry
    • EIAJ - Electronic Industries Association of Japan (EIAJ) part of Japan Electronics and Information Technology Industries Association (JEITA).
  • 17. Example EDI interchange Based on an EDIFACT example, the most common messages types are related to processing ORDERS and INVOICES COMPANY A COMPANY B ORDERS ORDERSP INVOIC Many different message types exist...
  • 18. Communications standards - I
    • EDI predated the internet explosion in the 1990s...
    • Modems - 1970s-1990s (point to point communication between partners)
    • ISDN - Integrated Services Digital Network
    • X.25 – reliable WLAN protocol during 1980s and early 1990s
    • OFTP/OFTP2 – FTP based transport protocols that include features like encryption, compression etc
  • 19. Communications standards - II
    • More advanced communications were made possible by advances in the 1980s and later the internet...
    • VANs - Value-added Network (hosted service offering that acts as an intermediary between business partners. Offers reliable messaging, auditing etc)
    • AS1, AS2, AS3 – modern protocols offering encryption, reliability, disposition notifications etc based of SMTP, HTTP, FTP
  • 20. Communications standards - III
    • Web services came along simplifying integration...
    • Web Services/SOA – standards for system design providing greater interoperability and flexibility
    • SOAP/WSDL/UDDI – technologies that implement SOA on the basis of HTTP(s), XML etc. that are most commonly used.
  • 21. B2B Gateway features - I
    • Modern B2B gateways need to support...
    • SOA/ESB (enterprise service bus) Capabilities – suitable for integration of multiple services and their “orchestration” into larger more complex ones.
    • BPEL - Business Process Execution Language. OASIS standard for “orchestration” of web services. Defines business processes composed of service interactions.
  • 22. B2B Gateway features - II
    • Modern B2B gateways need to support...
    • Communications support – all commonly used protocols.
    • TPM (Trading Partner Management) and usability – centralized and easy to use interface that allows manipulation of all data relevant to trading partners (e.g. how to connect)
    • Document/message tracking and audit functionality
  • 23. B2B Gateway features – III
    • EDI document conversion and mapping design capabilities..
    • Should support all common data formats
    • User-friendly mapping design
    • Modular/reusable mappings for large deployments
  • 24. B2B Gateway Products (high end)
    • High end B2B gateways have a comprehensive feature set...
    • Biztalk Server (Microsoft)
    • XI eXchange Infrastructure (SAP)
    • Business Integration Server (Seeburger AG)
    • B2Bi (Axway)
    • B2B Integration (Sterling)
    • e-Commerce Gateway (Oracle)
    • others...
  • 25. B2B Gateway Products (low end)
    • Low end products possess a subset of features making them applicable to small companies...
    • Bots open source EDI translator - http://bots.sourceforge.net
    • Webswell Business Hub (hosted), Websswell Connect and others (open source) - http://www.webswell.com
    • Celtix: The Open Source Java Enterprise Service Bus - http://celtix.ow2.org
    • Simpler tools, hosted solutions, SAS ...
  • 26. Example product – BOTS I
    • BOTS is a free/open source EDI product suitable for small deployments
    • Written in python and uses an embedded database or can use an external one
    • Presents a relatively simple Web configuration interface to the user
    • Customization involves programming/ scripting.
    • Defines channels/routes/translations that can be scripted
  • 27. Example product – BOTS II Route: Channel: Translation:
  • 28. EDI Implementation (large)
    • Project stages
    • Business case analysis
    • Product selection (features, cost)
    • Process design and communications rollout
    • Mapping design (high effort)
    • Infrastructure, administration etc.
  • 29. EDI Implementation (small)
    • Project stages
    • Business case analysis – usually requirements set by larger partners
    • Product selection (features, cost) – choose a suitable cost effective product or develop something in-house
    • Process design and communications rollout - simple
    • Mapping design – a few mappings
    • Infrastructure, administration etc.
  • 30. EDI in Eastern Europe - I
    • EDI is typically shunned by small companies because of costs and perceived lack of real necessity
    • EDI implementations typically come as a result of requirements by large companies (e.g. market chains) or western partners
    • Lack of trained consultants on legacy standards like EDIFACT, ASC X12, VDA and similar that are demanded
  • 31. EDI in Eastern Europe - II
    • Ad-hoc implementations that are easy starters but offer no flexibility later on
    • Small ERP vendors aiming for customer lock-in
    • Need for EDI questioned at a time of crisis by small companies
  • 32. Legal issues in EDI
    • (Contract) Laws needed consistent with EDI (or need to back up EDI documents with paper ones, possibility of accumulation... )
    • Legally binding contractual arrangements (Trading Partner Agreements, valid under contract law and based on EDI standards accepted as national standards - eases contractual disputes)
    • Document retention policies, and use of third party mediators (VANs)
  • 33. Conclusion Q & A This presentation may be shared and used under a creative commons license: http://creativecommons.org/licenses/by/3.0/