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EDI Academy – Global interoperability

20/07/2016

In the globalization era, there can be no frontiers for businesses. Communications between businesses can no longer be limited to one sector, company type or specific country. Nowadays, it is indispensable to be able to link up with any trading partner, regardless of their characteristics. So, in this new entry of the EDI Academy series we’re going to talk about global interoperability.

When we say “interoperability”, we are referring to the capacity to set up fluid electronic communications between companies, even though they may not share the same software or standard. In other words, making the technological applications that one and the other use work together as if they were a single unit.

 

Why is interoperability necessary?

Interoperability allows communication to flow smoothly and efficiently with all partners. It enables us to transmit information in real-time, ensure the appropriate security measures and, most importantly of all, automate the entire process.

As we have noted throughout this series, EDI is a system that facilitates interoperability largely due to the use of international standards. However, today there is still no global standard that is able to automatically cover all technological solutions, which continues to remain a great challenge for the business world.

 

How do we achieve interoperability?

Obviously, creating a common standard would greatly facilitate interoperability worldwide. In fact, several regions are already working on it. This is the case, for example, of the European Union, which is rolling out an interoperable e-invoicing standard  for all member states.

However, this is a long-term solution, so there are other alternatives to ensure that communications keep flowing smoothly between companies, starting from right now. This is where the EDICOM team takes action on different fronts:

  • EBIMAP. This is a multi-format data structure translator, which converts information into the standard accepted by the ERP or internal management system. This means that even though the EDI messages are initially created in a given format, when they reach the recipient they are automatically adapted to the format required by the system. The same thing happens the other way round.
  • Interoperability agreements. Value-added networks (VANs) are currently the main EDI communications system, but in order for it to work, both sender and receiver must be using the same VAN. To avoid this problem, EDICOM signs interoperability agreements with the major VANs worldwide. This way, companies forming part of EDICOMNet can communicate with any trading partner, even though they may not be part of the same network.
  • Public Administrations HUB. The public administrations of several countries are rolling out paperless initiatives for tax compliance. Companies must now be able to link up their systems with those of the different bodies. To this end, EDICOM has created this HUB, which ensures connectivity with any public entity in the local, regional, national and international scope.

Would you like to know more about electronic data interchange? Check out all the posts in our EDI Academy series.

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