Wednesday, September 2, 2009

SAP EDI and B2B Changes and Using NetWeaver PI

There are many rapid changes occurring these days in SAP EDI and B2B support. This article provides a view on the traditional approach and how this is quickly changing.

If you are an SAP customer, the traditional approach to implementing EDI looked as follows:
  1. Source and purchase a third party EDI system
  2. Purchase and install servers (development, testing and production servers)
  3. Hire EDI experts
  4. Purchase libraries of EDI standards
  5. Select and write your preferred EDI Implementation Guides (requires EDI standards expert)
  6. Train EDI staff on EDI system
  7. Identify priority customers and suppliers for on-boarding
  8. Contact all trading partners to understand and document the EDI or B2B files they are willing to support
  9. Scope the on-boarding project
  10. Design, develop and deploy integration scripts between SAP and your EDI system
  11. Now map all of these business processes from the EDI system to hundreds of different combinations of data formats and communication protocols that your trading partners demand
  12. Set-up EDI and IT Custom Service helpdesk
  13. Kick-off multi-year on-boarding project
  14. Set-up internal processes to monitor and maintain EDI system and operations 24x7x365
The traditional EDI implementation scenario is represented in these 14 steps. It is also typical, that as soon as one department begins to implement EDI or B2B data exchanges, then 11 other departments suddenly MUST have it. EDI is often required in the following areas:
  • Supply Chain (SAP SNC, SRM, etc)
  • Transportation Management (TM and Inbound and outbound Logistics)
  • Procurement
  • Inventory and Warehouse Management
  • Production Planning
  • Manufacturing Execution
  • Sales Order Management
  • HR Benefits (insurance, 401k, etc.)
  • Global Trade Services
  • Financial Supply Chain
  • Treasury (electronic funds transfers, etc)
  • Much, much more...
Each of these departments have their own high priority trading partners and business deliverables that are suddenly reliant on the EDI department to on-board all of their key trading partners immediately.
An additional challenge, many departments are asking for support of different EDI and B2B standards. Treasury wants electronic banking messages, the supply chain wants XML B2B standards, customers want traditional EDI, small customers can only send flat files, etc.

The EDI department now has a "combinatorial explosion" to manage. The traditional approach to this problem is to throw more IT budget, software, hardware, contractors and FTEs at the problem, but that doesn't always go over well with the CFO these days.

SAP is uniquely positioned to be able to solve many of these traditional and expensive EDI challenges for their entire SAP customer base. They have studied where efficiencies, cost savings and economies of scale could be gained, and after much work and research they announced they had invested in and become a co-owner of an EDI and B2B exchange called Crossgate. This exchange operates on the SAP NetWeaver platform and utilizes SAP technologies to simplify EDI and B2B for SAP users. It does not require the large investment of time and money represented by the 14 steps above. It requires a simple plug-in using SAP-to-SAP connectivity to an SAP-centric exchange.

Crossgate's use of canonical data models at the hub, powerful software tools that enable rapid alignment of complex data formats across thousands of trading partners provide efficiencies never possible before. All companies connected to the exchange can now reuse the maps and connections to over 40,000 other companies (this number grows daily).

With SAP's recent investment, there are now multiple joint development projects between SAP and Crossgate to continue on this path towards Business Network Transformation, a phrase used often by SAP CEO Leo Apotheker. This phrase describes the concept of taking a macro-view of all SAP users, and looking for efficiencies that SAP can introduce across their entire customer base. This can also be called a network view. A network view looks at services that can be performed that add value to the entire network or customer base. Often these network-centric services (e.g. EDI/B2B) can be provided in a cloud computing environment, on SAP technology, and integrated with all SAP users through pre-defined enterprise services. A method of extending eSOA outside the four walls of the enterprise.

If you would like to discuss any of these ideas, concepts or solutions in more detail please email me.


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