Thursday, August 20, 2009

SAP-Centric EDI and B2B - What the CIO Needs to Know

Posted by Kevin Benedict
SAP's new paradigm and model for EDI and B2B is called Business Network Transformation. This is the idea that the SAP user community and their associated network of trading partners can benefit by reusing and leveraging each other's EDI and B2B connections. This concept requires a central repository of all connected companies, EDI and B2B maps, a centralized canonical database model, a world class data center for managing billions of transactions per year, a powerful set of software applications designed to simplify the on-boarding of trading partners for SAP users, all integrated into an SAP-centric technology stack. SAP's investment in Crossgate has now made this goal a reality for SAP customers.

In addition to simplifying EDI and B2B for all SAP users, SAP's investment in Crossgate was also motivated by the realization that SAP solutions like SNC (Supplier Network Collaboration), TM (Transportation Management) and e-Invoicing are dependent upon cost effective communications with large networks of trading partners. The B2B communication component becomes a critical part of the success and ROI of these solutions and is best served by being tightly integrated with the rest of SAP's products and strategies.

SAP's Business Network Transformation strategy is an interesting and different paradigm because it takes an SAP-centric approach to EDI and B2B. What does EDI and B2B look like from an SAP-centric view?

  1. SAP made a significant investment in a rapidly growing company that owns and operates Europe's largest managed EDI and B2B services HUB called Crossgate.
  2. Crossgate's services are developed for and operated on SAP's NetWeaver platform.
  3. This is now SAP's recommended EDI and B2B managed services (BPO) solution globally today.
  4. SAP/Crossgate are now developing multi-year roadmaps for EDI and B2B integration solutions for all SAP components that consume and produce EDI and B2B messages.
  5. Pre-configured EDI and B2B services are being uploaded and published to SAP's ESR (Enterprise Services Repository) for reusability and customization.
  6. SAP users can implement new business processes and associated EDI and B2B services in an on-demand SaaS or IaaS model by simply requesting the Crossgate EDI/B2B service and designating messages and trading partners to activate.
  7. SAP's Global Data Types are being used to normalize the semantics and syntax of data across the SAP environment and they are also being incorporated into the SAP/Crossgate EDI and B2B Automated Business Exchange. This will become an increasingly important feature for SAP users.
  8. As new Enhancement Packages are released by SAP, the SAP/Crossgate EDI/B2B services will be released to support them. For example, Transportation Management (TM) and Supplier Network Collaboration (SNC) have full SAP/Crossgate EDI/B2B message roadmaps. These defined EDI and B2B messages will be available for TMS and SNC customers on-demand in the ESR.
  9. Electronic Invoicing is in big demand as a way to lower the processing costs of invoices and improve the speed of invoice approvals so early payment discounts can be captured. SAP utilizes Crossgate's EDI and B2B integrations and on-boarding services to convert paper based invoices to electronic invoices globally.
  10. SAP and Crossgate are developing methodologies and services to simplify the implementation and on-boarding of trading partners. Knowing that the connected back office application is SAP, enables many integrations to be pre-built and stored in the Enterprise Services Repository.
  11. SAP users will benefit from the EDI/B2B connections made by other SAP users on the network. Each new trading partner connection added to the SAP/Crossgate network will then be available for reuse by other SAP users connected to the network(with permission of course). The benefits and economies of scale presented by this model are powerful.
  12. SAP customers that want to consolidate and simplify their IT environments around SAP solutions will want to carefully consider the Business Network Transformation strategy articulated by Jim Hagemann Snabe, a member of SAP Executive Board at last years Sapphire and in 2009.
If you would like to discuss the Business Network Transformation strategy in more detail please email me.

For more information see read these articles:

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