E-Commerce

Assignment
CASE STUDY - EDI

Submitted by:
Name: Justin Joy Kakashary
Reg. No: 21MCMR105
SUMMARY:

Order processing speed is crucial for distributors with extensive

global logistics networks and strict just-in-time delivery
specifications. Yet, maintaining business operations presents difficult
technical hurdles because millions of electronic data interchange
(EDI) messages are being sent and received by various value chain
players.
This was the predicament Coastal Pacific, the second-largest
consumer goods distributor in the world for the US military, was in.
According to Pat Ranga, VP of EDI/E-Commerce at Coastal Pacific
Food Distributors, the company has a contract to deliver more than
40,000 stock-keeping units (SKUs) from 700 manufacturers of
consumer goods. As a result, its buyers must constantly tread a fine
line between over and under-stocking its warehouses.
He goes on to describe the difficulties they went through.
Subsequently, there was a change. For more than 30 years, Coastal
Pacific's EDI platform has been IBM Gentran solutions. Coastal Pacific
initially thought of modernizing its current platform and
incorporating it with more scripting tools to facilitate quicker
searching for the status of purchase orders in the system. Even after
Gentran had long since met their needs, they predicted that if the
company grew and added more trading partners, they might need to
expand their EDI team by up to a factor of four to handle incoming
EDI information requests from the company. This would significantly
raise our operational costs.
They were convinced that switching from IBM Gentran to IBM
Sterling B2B Integrator would help them achieve their objectives for
a self-service platform after reviewing a variety of EDI frameworks
available on the market. For its 700 military partners, they tested
each of the EDI connectors before migrating them from Gentran to
IBM Sterling B2B Integrator.
Now, Coastal Pacific processes more than 3.5 million EDI transactions
annually for all of its military partners using IBM Sterling B2B
Integrator. The business is succeeding in delivering self-service
capabilities to set itself up for future growth thanks to the new
platform. Using IBM Sterling B2B Integrator, Coastal Pacific gets all
the features of its old Gentran platform with a lot less complexity
and administration expense.
With the aid of its new B2B integration platform, Coastal Pacific is
able to satisfy the US military's exacting reporting standards.
According to Pat Ranga, "Theoretically, we could be audited on any
individual order that we have placed in the previous seven years—
even at the level of a single case of soup. The time and date that we
transmit outbound purchase orders and receive proof of delivery
receipts are among the metadata that IBM Sterling B2B Integrator
records for all of our EDI operations. With the support of our IBM
solution, we can be sure that all of our data is easily searchable to
make it easier to meet customer requirements.
In order for our manufacturers to invoice the commissaries for the
goods we have delivered, we send them 14,000 invoice transactions
every 15 days, he says. It is crucial to make sure that our clients can
send their invoices on time because the total billing amounts can
exceed several million dollars and we are subject to financial
penalties of more than one hundred dollars for each late invoice. We
can continue to manage multi-billion dollar EDI transactions like
clockwork with IBM Sterling B2B Integrator at the helm of our EDI
processes, allowing us to maintain high fill rates and market-leading
competitiveness.
Now, Coastal Pacific processes more than 3.5 million EDI transactions
annually for all of its military partners using IBM Sterling B2B
Integrator. The business is succeeding in delivering self-service
capabilities to set itself up for future growth thanks to the new
platform.
According to Pat Ranga, "In the past, our purchasers had to call me
to verify if a trade partner had received a purchase order, increasing
the possibility of delays and missing orders." Currently, we provide a
self-service site for our staff members to check the status of any
purchase order in real-time. This assists our customers in quickly
resolving manufacturing-related difficulties and maintaining the
timeliness of orders.

Questions:
1. What are the obstacles that the Coastal Pacific Food
Distributor faces?
Ans: The capacity to handle orders effectively is critical for
distributors with global logistics networks and stringent just-in-
time delivery needs. Keeping business operations operating
smoothly, however, offers complicated technological hurdles with
millions of electronic data interchange (EDI) messages moving
between numerous stakeholders in the value chain. The exposure
of our communications was a barrier for us. When one of our
manufacturing clients informed our buyers that they had not
gotten a PO, our buyers had to email or call me to dig for the
document and determine whether the problem was on our or the
client's end. Because we service nations with very different time
zones, there was always the possibility that delays in responding
to our buyers' requirements might force us to miss a delivery
deadline and we sought a solution.

2. What was their motivation for switching from IBM

Gentran to IBM Sterling B2B Integrator?
Ans: Although Gentran had met the criteria for many years, we
anticipated that if the business developed and we added new
trade partners, we would need to increase the EDI team by a
factor of four to handle EDI information demands from the
business, significantly increasing our operating expenses.
Coastal Pacific sought a more cost-effective method of increasing
the exposure of its EDI messages. The goal was to provide a self-
service portal that would allow purchasers to verify the progress
of their purchase orders at any time and from any location,
complementing the company’s follow-the-sun process.

3. Why should an EDI software solution be preferred over

a web-based or server-based solution?
Ans: provide a self-service interface for staff to access the status
of any purchase order in real-time. This enables our buyers to
quickly fix production difficulties and keep orders on pace.
Our buyers have given us really favourable comments. how much
easier it was to schedule working days since it is so much easier to
demonstrate to the commissaries that there are no EDI difficulties
on our end.
The initial requirement is to comprehend the influence of EDI on
your business procedures. Because web-based and service-based
solutions will have a manual aspect entrenched in the process,
there is a potential for mistakes to be introduced into the business
process. EDI software enables you to exchange data directly with
back office systems, hence avoiding human mistakes. The time
saved inputting data and reducing mistakes allows your
organization to focus on order fulfillment and, more importantly,
client happiness. The crucial thing to remember is that whichever
EDI solution is picked will have an influence on your company's
operations in the future.