APIs, or Application Programming Interfaces, have become an integral part of our day-to-day interactions with the software we use at work as well as when we browse the internet. APIs are the little-known yet ubiquitous driving force that makes the interactivity of modern business-to-business (B2B) software applications possible. While many in the software space are familiar with the existence of APIs, most do not realize APIs' ability to complement B2B EDI platforms and further automate and optimize their company’s digital data exchange ecosystem.
The Gartner® research report, Use APIs to Modernize EDI for B2B Ecosystem Integration, provides an insightful overview of the benefits of APIs on a modern EDI platform including their impact on data exchange. The report also offers unbiased recommendations from Gartner analysts on how to best implement APIs into your existing EDI infrastructure.
What is EDI?
Electronic Data Interchange, or EDI, is a concept that has been common among large companies since at least the early 1970s and is used as a standardized way to electronically transmit information that has historically been communicated through paper. Large companies that are faced with the complex task of keeping track of and transmitting substantial volumes of data have looked to EDI as the answer to their logistical problems.
From purchase orders to invoices to freight information, all the data essential to running a business is transmitted through standardized EDI messages. Although EDI for B2B has been around for close to 50 years, keeping it from obsolescence is the introduction of new technology such as API which enables entirely new ways of realizing efficiencies from EDI systems.
What is an API?
An API is a set of rules, tools, and protocols that allow different software applications to communicate with each other. Through the use of smart B2B API integration, a company is able to:
- Enhance its B2B EDI platform to support real-time patterns, mobile applications, and the Internet of Things (IoT).
- Receive real-time status updates on orders.
- Expand the use of EDI to companies that have not previously had the ability due to the high cost and complexity of implementation.
- Integrate products and services with other products without requiring any knowledge of their implementation, simplifying development and saving time.
EDI vs API: A Simple Breakdown
API (Application Programming Interface)
APIs enable real-time data exchange and offer flexibility in data formats, making them suitable for applications requiring immediate access to data. They provide quick access to inventory and don't rely on standardized document formats, offering greater data exchange flexibility.
However, APIs lack standardization, can be costly to customize for specific business needs, and may become complex when connecting with partners who have their own APIs.
- Real-Time Communication
- Flexibility in Data Formats
- Instant Access to Data
- No Standardization Constraints
EDI (Electronic Data Interchange)
EDI follows standardized document formats, ensuring consistent data exchange reliability and efficiency. It reduces manual data entry, requires minimal user intervention, and simplifies management with a single communication method.
Migrating your EDI infrastructure can be complex and may not support real-time data exchange. There are also significant initial costs for software, hardware, and training.
- Standardization for Consistent Data Exchange
- Reliability with Low Error Rates
- Efficiency in Data Exchange
- Minimal User Intervention
- Single Communication Method
Choosing Between EDI and API
- EDI: Standardized, reliable, and efficient for data exchange.
- API: Flexible and real-time but requires standardization and customization consideration, especially with multiple partners. Your choice should align with your specific business requirements.
APIs for Onboarding
According to Gartner research, "one of the most common complaints against B2B software concerns the difficulty of onboarding partners". Oftentimes, partners are unresponsive or require assistance when it comes to configuring the software and performing data mapping. The more business partners a company is onboarding to its EDI system, the longer and more difficult the onboarding process is going to be. This is where APIs come in.
Business partners being onboarded can develop their own APIs to customize the integration to their unique internal systems or third-party EDI portals. No longer will partners being onboarded need to wait for a custom connector to be created for them now they can create an API to integrate with the EDI platform.
B2B Innovation with APIs
One challenge APIs face is a lack of universal standardization. While EDI has standards such as X12 in the United States and EDICOM in Europe, no such industry-wide standards exist for APIs. Instead, companies that use B2B APIs create their own definitions based on their unique requirements. This leads to a situation where APIs differ from project to project.
The 12 Benefits of B2B API Integrations
- Streamlined Data Exchange: B2B API integration simplifies and automates the exchange of data between business partners, reducing manual data entry errors and enhancing data accuracy.
- Real-Time Information: Enables real-time access to critical business data, ensuring that all parties have up-to-date information for informed decision-making.
- Improved Efficiency: Automation of processes and workflows leads to increased operational efficiency, reducing the time and effort required to manage transactions.
- Enhanced Customer Experience: Faster response times and seamless data sharing contribute to an improved customer experience, as partners can provide quicker service and support.
- Cost Savings: Reduced manual labor, lower error rates, and improved operational efficiency result in cost savings over time.
- Scalability: B2B API integration allows businesses to easily scale their operations and adapt to changing partner needs without significant IT overhead.
- Competitive Advantage: Businesses that embrace B2B API integration can respond faster to market changes and customer demands, gaining a competitive edge.
- Data Security: Secure and encrypted data transmission ensures the confidentiality and integrity of sensitive business information.
- Flexibility: APIs can support various data formats and systems, making them adaptable to diverse partner requirements.
- Analytics and Insights: B2B API integration provides opportunities for data analysis, helping businesses uncover valuable insights for strategic decision-making.
- Global Reach: Enables seamless collaboration with partners worldwide, expanding business reach and opportunities.
- Compliance: Helps businesses meet industry-specific regulations and standards by ensuring accurate and traceable data exchange.
What’s Next? Choose B2B API Integration That Fits
Comarch's global team of computer engineers and technical experts means our EDI platform can be holistically implemented into any company's existing processes with as much (or as little) technical input from the company upgrading its EDI platform. Our broad experience with different business solutions, from CRM systems to ERP software, means Comarch experts can develop the necessary APIs to seamlessly integrate a company's data exchange suite.
If the company prefers to create the needed APIs in-house, Comarch can provide the resources needed to easily connect to the Comarch EDI portal. Comarch experts also stand ready with the experience needed to fully onboard all of a company's business users onto their new EDI system. Of course, Comarch also provides an intuitive self-onboarding portal to allow a business to perform the onboarding itself.
With over 28 years of experience, Comarch has the global proficiency necessary to implement EDI projects for companies no matter their size or technical maturity. We’re here to help make the decision between in-house and outsourced EDI simple. Over 100,000 users from 40 different countries actively utilize Comarch's modern EDI platform to transmit more than 80 different message types.
To learn more about how you can leverage APIs to modernize your B2B EDI platform and establish better business processes, check out the Gartner® research report. Visit our website to learn more about Comarch EDI solutions or email us directly with any EDI-related questions.