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EDI Standards and Intellectual Assets in a Slow Economy

Often, when people think about EDI/B2B standards, they think of decades old technologies, file formats and communication protocols. This has some truth, but the real value of EDI/B2B standards is not in the technology and formats, but in the intellectual assets represented in the content of the standards. Often file formats can be developed over a few months, but the content in the EDI standards often takes decades of detailed research and analysis to define, develop and codify.

I have had the opportunity to participate in many industry EDI standards meetings where the details of an EDI Transaction Set were discussed. The process never ceased to impress me. EDI experts often know more about a business process than just about any other position in the company. Why? They must understand exactly what business data is needed, where it comes from, where it needs to go, and how it will be used. They must understand each step in the work flow to understand how business data can be moved, approved and reviewed. They are often involved in the process of creating new business processes to meet the requirement of a customer. They must understand how the data is entered into the system, what database stores the data, who owns the data and what the data means in the context of the business process.

Often the experienced EDI expert also knows what other customers use similar EDI transactions, what is similar and what is different about the data requirements of the different business units, divisions and geographical areas. This knowledge is an extremely valuable institutional asset and must be recognized and protected.

It is very easy and common in large companies to forget about the intellectual assets in a company. “Re-creating knowledge that a company already possesses is a time and resource consuming activity,” writes author Thomas Gale in the white paper titled Reusing Intellectual Assets. “As companies increasingly compete on the basis of knowledge, they must improve their methods for reusing intellectual assets.” EDI experts are often one of the richest sources of intellectual assets in the entire company.

It would be a wise strategy to have a database application that served as an EDI repository and registry for all information related to a trading partners and their EDI messages and content requirements, but it is very rare for an enterprise to have the foresight and resources to build this repository. Today, these tools are mostly found in EDI managed services companies. They have the volume and business model to support tool development and strategy execution. For companies that do not have these internal resources, think 2 or 3 or 4 times before laying-off your experienced, EDI experts. The intellectual assets inside their heads take many years to replace.

EDI experts are not just communication and format specialists, rather true EDI experts understand not just the syntax of an EDI file, but the content and semantics of the content and how it is used. If a company must reduce the size of their IT and EDI departments due to economic issues, think about outsourcing the EDI operations to a professional EDI/B2B managed services business, but keep the EDI experts in-house as their knowledge is critical and very useful in the areas of business process design, supply chain management, logistics, orders-to- cash, procure-to-pay just to name a few. They often make exceptional business analysts, systems analysis and customer IT liaisons.

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