EDI data analysis and business intelligence

  March 01, 2012       By Ray Atia
Gap analysis is vital during implementation of an Electronic Data Interchange (EDI) system. Any changes to a company's software must also involve the analysis. With EDI for retailer, there are identification codes that frequently miss or fail to match existing ones. Another issue with EDI information failing to match is parties that use different EDI standards. A trading partner in areas like Europe uses the EDIFACT standard while a person in the United States uses X12 standards. This means that the trading partners should support both standards for the EDI information to match. EDI helps to improve relationships between trading partners. Each party should however internally optimize their own business process. You may want to improve the process that you use to process payments or improve the invoice delivery process. Developing a system to get Advanced Ship Notices from suppliers is another improvement that can be implemented. You may also optimize your business to receive electronic orders. All these changes should be made starting from the major trading partners. One instance where an EDI gap may exist is a document requesting healthcare service. In this mandatory document there is a section to fill out the identity of the health provider which is given to every provider by the health care finance governing body. If you have only one clinic, you may not include this in patient records. Transmitting information to insurance companies with EDI for preauthorization to treat patients, you need a way to incorporate the information. Translation software comes in handy at this point since the information never changes. The information can be included into the guideline that produces EDI information for you that will be sent to insurance companies. Inbound retailers EDI data may also require that you do a gap analysis. Lets say, for instance, that your bank needs to send you payment information. An analysis may indicate that your system only records social security numbers whereas the bank sends you a bank account number. The gap analysis you carry out must come up with a mechanism to reconcile the information you receive from the bank with your accounts receivable system. This should deal with the fact that there is a key difference between the two pieces of information. Gap analysis therefore helps your EDI to bring you closer to your trading partners.