APIs and EDI: Aligning for Success

We recently published an article that explains when you would choose EDI vs. APIs for B2B integration and vice versa. However, you wouldn’t choose one over the other in many cases — you would choose both.

Why Are More Companies Using EDI and APIs Together?

Several recent trends have driven companies to create hybrid integration solutions that leverage EDI and APIs. These trends include:

• Growing demand for omnichannel services. Most B2B and B2C customers today want omnichannel fulfillment options when they place orders online — like buy online pick up in store (BOPIS) and ship-from-store. EDI lets organizations transmit massive volumes of data among suppliers and trading partners, and APIs enable real-time access to that data. You can use EDI and APIs to better integrate with trading partners and enable omnichannel fulfillment options.
• Staggering increase in the volume of online orders. eCommerce and supply chain companies have seen a dramatic increase in the number of online orders they need to process. They need automation and orchestration to keep up with the sheer volume of orders they see daily. With both EDI and APIs, you can automate and streamline workflows across the supply chain, reducing the time to process, fulfill, and ship orders.
•  The need to create new and innovative customer experiences. The competition among businesses, for both B2B and B2C companies, increases every day. Modern consumers expect companies across industries to provide fast, connected, and seamless customer experiences. The best way to compete in today’s digital world is by creating new and engaging experiences across different channels. You can accomplish this by using EDI and APIs together.

Real-World Use Cases for a Blended EDI and API Approach

Companies in every industry can leverage EDI and APIs for B2B integrations and workflows. Here are a few real-world scenarios:

Supply Chain
You can use EDIs and APIs together to streamline supply chain processes, making them faster and more efficient. For example, you could use a natural language processing (NLP) API to enable your system to answer questions from trading partners like, “what is the status of PO #95400?” The API would answer that question automatically in real time, and EDI could provide all the documents related to that purchase order.

eCommerce
You can use EDI and APIs for a wide range of eCommerce tasks. For example, you could use EDI to transmit documents — e.g., purchase orders, inventory logs, invoices, and bills of lading — to trading partners, and APIs to get real-time information from those systems. Real-time information might include the status of a purchase order or the current location of a shipped order. Also, an API could help a customer find what they need through an online store, and EDI could then start the order process with the supplier.

Insurance
Many opportunities exist for healthcare, auto, home, and life insurance companies to improve processes with EDI and APIs. For example, a healthcare provider could use an API to check insurance member eligibility in real time and, if eligible, submit claims for payment with EDI. An auto insurance company could use APIs to offer instant insurance enrollment. When required, they could then use EDI to send loan servicers and servicing bureaus notifications of auto insurance coverage.  

Finance
Today, most financial organizations use EDI to transfer electronic payments and payment information because it is highly secure and in a standardized format. With EDI, banks can securely report account balances and summarize financial transactions. Financial organizations can use APIs to create customer-facing applications that connect with internal banking systems, providing real-time information to end users, like checking and credit card balances.

Automotive
A standard automotive industry workflow involving EDI usually includes a delivery forecast, a shipping notification, a receipt for goods received, and an invoice. Automotive suppliers could use APIs to create a transactional path for advanced shipping notices (ASNs) and then EDI for other items like receipts and invoices. ASNs are somewhat time-sensitive, and with APIs, you can send ASNs faster. 

B2B Partner Onboarding
You can use APIs to offer partner self-service integration for EDI and APIs, and automate parts of the partner onboarding process. For example, you could provide self-service onboarding for EDI data exchanges and automate the process of arranging EDI data into the proper format. With APIs, you could perform automated credit checks when onboarding new partners and let partners customize integrations to suit their systems, whether they choose EDI or APIs.

How Do You Leverage EDI and APIs Together for B2B Integration?

When it comes to B2B integration, you need to create a solid technology foundation that supports your business partner ecosystem. That foundation should include multiple integration capabilities that allow you to connect in a variety of ways, including:

• Electronic Data Interchange (EDI) – To support communication in a standardized format or prefer EDI for B2B integrations. EDI is also needed to batch process complex payloads and deliver large data files. This must support EDI translation, partner management, routing, and multiple protocols and standards. 
• Managed File Transfer (MFT) – To support the exchange of files between partners, systems, and applications, enhance the security of file transfers, encrypt data in transit and at rest, manage and audit exchanges of business data, and confirm receipt of digital files.
• API Management – To support the development, management, security, visibility, and self-service capabilities for connecting. This includes:
• Outer APIs – For connecting external consumer or partner-facing mobile and web applications to backend systems and data.
• Inner APIs – To connect internal services provided by different groups within the business.
• Messaging – To enable asynchronous publish and subscribe (pub/sub) capabilities with the ability to trigger or schedule messages.  

You won’t find one silver-bullet solution or product that includes everything you need to use EDI and APIs together. You will need to create your own platform by combining different integration tools. Examples of integration tools include API gateways and iPaaS. Your platform should also provide visibility into APIs, transactions, messaging, operations, and data.

You also need to include API management tools in your B2B integration technology stack. And those tools should allow you to create and nurture an API ecosystem.