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ECommerce EDI Toolkit

ECommerce EDI Toolkit. Version September 2008. What is EDI?. EDI stands for Electronic Data Interchange EDI is the electronic exchange of business data using a published standardized format Partners must agree on the format specifications to be used when exchanging business documents

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ECommerce EDI Toolkit

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  1. ECommerce EDI Toolkit Version September 2008

  2. What is EDI? • EDI stands for Electronic Data Interchange • EDI is the electronic exchange of business data using a published standardized format • Partners must agree on the format specifications to be used when exchanging business documents • EDI is intended to be a computer-to-computer exchange • EDI enables efficient, accurate, and paperless business flows

  3. How Does EDI Work? • Standard electronic business documents are communicated from an organization’s computer, through translation software, then to an electronic post office, which is called a Value Added Network (VAN) • The documents are then distributed by the VAN to all the necessary trading partners • Trading partners receive the documents to process through translation into their computer applications

  4. EDI Data Flow

  5. Cummins Supplier DELFOR Material Release System Manufacturing Planning System DELJIT Update Inventory (MRP) DESADV Material Receiving System Material Shipping System APERAK RECADV INVOIC Accounts Payable System Accounts Receivable System REMADV REMADV $$$ $$$ Bank Supply ChainTypical Message Flows

  6. Cascading Benefits ofElectronic Information Price Catalogs Orders Ship Notices Invoices Invoices Remittance / Payments Evaluated Receipt Settlements

  7. Sample EDI DESADV UNB+UNOA:1+004154415:1+006415160:1+060919:1445+1855' UNH+2775+DESADV:D:98B:UN' BGM+351+00095093+9' DTM+11:200609191444:203' DTM+17:200609201444:203' RFF+AAU:M00009107' NAD+SF+004120::16++CUMMINS FILTRATION' NAD+ST+792820524++CUMMINS CMEP+WALESBORO COMPONENTS PLANT:WALESBORO EXIT, RL 22+COLUMBUS+IN+47201' LOC+7+022' RFF+PK:00095093' TDT+20+00009107++LT+MHRE::182' EQD+TE+530467' CPS+1++4' PAC+7++CTN25' QTY+52:252:EA' LIN+1++4944410:IN' IMD+++:::IDLER ASSEMBLY' QTY+12:1764:EA' ALI+US' RFF+ON:521019' LIN+2++4944420:IN' IMD+++:::IDLER ASSEMBLY' QTY+12:1750:EA' ALI+US' RFF+ON:521019' CNT+2:2' UNT+26+2775' UNZ+1+1855

  8. Benefits of EDI • Timeliness is increased • Data can be exchanged 24 hours a day, 7 days a week • No delay due to physical mailing time • Customer service is improved • Electronic processes meet customer mandates and maintain competitiveness • Data throughput time decreases to meet costumer needs • Bottom line costs are reduced • Data accuracy improves when manual process are eliminated • Resources formerly spent reconciling variances and entering data can be used to add value

  9. CumminsBusiness Expectations • Information flows are vital to the success of companies in the global business environment • Cummins utilizes ECommerce tools to obtain and communicate accurate, reliable, and timely information throughout our supply chain • Cummins is committed to meet and exceed our customers’ expectations • Cummins expects that our supply chain partners will share our commitment to adopt world-class business practices

  10. CumminsECommerce Expectations • Cummins requires all suppliers to use Electronic Data Interchange (EDI) to support business-to-business (B2B) communications • Use of EDI EDIFACT message formats as documented in the Cummins Implementation Guides is required

  11. CumminsStandard EDI Documents

  12. DELFORDelivery Forecast • Planning schedule with release capability • Sent by the customer, Cummins • Materials/production forecast by part number • May include firm order, planned, and immediate requirements • Full schedule replacement will be sent no less than once per week • Additionally, net change schedule for a part number may be sent daily

  13. DELFORBenefits • Allows direct download of delivery forecast data into supplier’s MRP system • Conveys Cummins material requirements in a timely and accurate manner

  14. DESADVDespatch Advice • Advanced Ship Notice • Sent by the supplier • Contains list of contents in a specific shipment • All DESADVs must be received before the arrival of the material at the Cummins plant • DESADV should be sent within 30 minutes of departure from the supplier dock • Shipment identification (SID) number must be clearly marked on all packing list documents • The SID number cannot be repeated within a 12 month period • The purchase order number and part numbers on the DESADV must match the purchase order

  15. DESADVBenefits • Allows direct download of advanced shipment data into Cummins inventory receiving system • Reduces inventory discrepancies, material shortages, and time spent correcting manual errors • Provides receiving and materials personnel with visibility of inbound shipments and reduces orders to expedite • Avoids time and effort needed to sort through non-standard packing slips to match receiving documentation

  16. INVOICInvoice • Invoice • Sent by the supplier • Allows direct load of invoice to Cummins accounts payable system to increase accuracy and reduce manual effort • Purchase order number and part numbers must match the purchase order • The EDI invoice must contain identical data when compared to the invoice of record in the supplier’s invoicing and accounts receivable systems

  17. INVOICBenefits • Eliminates the risk of an invoice being lost or detained due to traditional mail routing • Reduces the costs associated with manually processing invoices • 10 full time analysts are needed to process/resolve issues associated with an average monthly volume of 35,000 supplier invoices in Southern Indiana alone • Allows an automated reconciliation process • Improves data accuracy

  18. APERAKApplication Error and Acknowledgment • Notification of error in DESADV or INVOIC • Sent by the customer, Cummins • Automatically notifies supplier of a data content error in an EDI document and that the document was not accepted into the customer’s system • Supplier is required to correct the error and resend the corrected EDI document

  19. APERAKBenefits • Eliminates reconciliation errors within systems • Notifies suppliers of inconsistent or incorrect data • Supports Cummins’ common approach/best practices and requires no manual intervention at the plant • Saves time and effort by eliminating the need for materials planners/schedulers or finance managers to follow up with suppliers due to simple data errors • Average time for materials planners/schedulers to resolve each receiving error ranges from 60-90 minutes

  20. OtherMessages • DELJIT • Delivery Just In Time • Supplement to DELFOR • RECADV • Receiving Advice • Part number / quantity discrepancy • PRICAT • Price Catalog • Up to date pricing information • REMADV • Remittance Advice • Electronic Funds Transfer (EFT)

  21. EDIGetting Started • Select Integrated EDI or Sterling Web Forms • Integrated EDI – computer to computer transfer of data in standard EDIFACT format (requires translation software and a VAN connection) • Web Forms – an EDI alternative that allows a trading partner to send and receive documents using a web browser through Sterling Commerce • Complete the Supplier Response Form • http://www.cummins.com/suppliers • Visit the ECommerce website for more information • http://www.cummins.com/suppliers • Contact the Cummins ECommerce Implementation Team • Electronic.Commerce.Support@cummins.com • 812-377-3441

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