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Benefits of EDI Usage in Transportation Management Systems

Benefits of EDI Usage in Transportation Management Systems

The need for real-time visibility has reached an all-time high for transportation companies.  As Bart De Muynck, Research Vice President, Gartner, says, “Organizations have increasing demands for real-time, or at least near-real-time visibility into their orders, multi-modal shipments, and inventory across a network of business partners, both stationary and in transit.”

Providing T&L companies access to real-time information is Electronic Data Interchange, which is the inter-organizational exchange of business documents in a pre-defined structured format.  EDI permits trading partners to generate, receive, and process data with little or no human intervention.  With EDI, standard business documents  can be transmitted instantaneously using telecommunication capabilities.

Benefits of EDI

Benefits of EDI

  1. With EDI, routine high volume communications can be automated.  This ensures that dispatchers and accounts receivables staff have time to focus on value added services. For example, expenses associated with usual operational tasks can be considerably reduced or even eliminated, lowering transactions costs by at least 30 percent. When this number is multiplied annually, the savings can be substantial.
    A study by La Londe and Cooper found that firms with electronic ordering have experienced sales increases of up to 50 percent. EDI enables firms to be more responsive to customer needs by decreasing order transmittal time and lead times.
  2. EDI eliminates dispatchers from having to manually key information into dispatch operational and billing systems.  This results in savings while eliminating any costly data entry mistakes. Thus, errors due to illegible faxes, lost communication or incorrect phone messages are eliminated and documents processed much faster.
  3. For the transportation industry, business cycles are revved up sharply. Normal waiting time for documents which range from a day to a couple of weeks, can happen in the space of a few minutes.
  4. Companies can use EDI to integrate with various transportation management systems or direct carrier systems. This will help to tender and re-tender loads, transmit and receive appointment time and status.
  5. Eliminating paper transactions and substituting them with electronic alternatives, is a display of corporate social responsibility.
  6. However, one of the key benefits of EDI stem from the real-time visibility into transactions. This makes for faster decision-making and improved responsiveness to rapidly changing economic and market scenarios.  The business model is altered completely from a demand-driven model to a supply-driven one.

Successfully Delivered 30+ Digital Transformation Projects in the Last 10 Years

To summarize, In the quest to achieve a paperless society, Electronic Data Interchange has long been a leading technology. It predates the emergence of Internet and now a chief electronic network connecting just about every business to every other.  To know more about the benefits, read whitepaper `EDI in Transportation: The Standard that Continues to Automate and Integrate Operations

Hiten Mukesh Shah

Hiten Mukesh Shah

Hiten Mukesh Shah has been with Trigent Software for the last 12 years and he now works as Senior Business Analyst. With over 15 years of experience, Hiten has strong expertise in business analysis, software testing, quality assurance and project management.

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