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A Foolproof Guide to Fixing and Preventing EDI Errors

Electronic data interchange (EDI) is a streamlined and secure way to exchange business documents with your trading partners. It’s an automated approach that significantly reduces the risk of errors. However, problems can still occur.

November 29, 2023

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EDI relies on complex standards and formatting to function smoothly. As a result, poorly set-up communications can lead to delayed, failed, or incorrect transmissions. These EDI issues can cause serious headaches for your business, including system downtime and financial losses.

In this comprehensive guide, we will cover what EDI is in business and the five common types of EDI errors. We’ll also explain how to troubleshoot, resolve, and, most importantly, prevent errors in the future.


What is EDI?

Put simply, EDI is the electronic exchange of business documents between trading partners.

EDI transmits data directly from your computer to your trading partners’ systems. This computer-to-computer interaction outshines traditional communication methods like mail or email because it doesn’t require people to manually download or upload documents. Removing these time-consuming and high-error processes from your trading communications leaves you with a simple, speedy, cost-effective, and secure method for sending documents.


The Importance of EDI 997 Functional Acknowledgement

When you transmit a document to a trading partner via EDI, their system typically responds with an EDI 997 transaction set, according to the predefined standards both parties have agreed on.

This transaction set verifies whether your message has been “Accepted” or “Rejected.” If it’s Rejected,” it usually means there are errors you need to rectify. We’ll take a look at the most frequent of these errors in the next section.


The EDI Error Code List: The 5 Common Types of Error

Let’s take a look at the five most common EDI issues. 


EDI Error 1: Incorrect Document Format

EDI standards and regulations are constantly evolving. Failing to comply with these standards can lead to data format discrepancies that impact your communications. There are many possible mismatches, such as differences in character encoding and field lengths, which can cause you or your partner to misinterpret data.

How to fix and prevent data format errors:

  • Establish clear data format specifications with your trading partners.
  • Employ official standards set by standards organizations like the Electronic Data Interchange for Administration, Commerce and Transport (EDIFACT) or the American National Standards Institute (ANSI).
  • Regularly update your EDI software and systems to avoid compliance errors.
  • Seek guidance from your EDI vendor.
  • Use external monitoring services to ensure you adhere to regulations.


EDI Error 2: Routing Errors

Routing errors occur when data elements in the sender and receiver's systems fail to match. For example, if one or more cells in a database are empty, incorrect, or incomplete. These errors can lead to lost or misinterpreted data, significantly adding to the cost of business operations.

How to fix and prevent routing errors:

  • Test and validate your data to catch any slip-ups.
  • Use safety nets like a two-step verification for data entry or set up automatic validation processes.
  • Tweak your enterprise resource planning (ERP) system to spot and flag any mistakes in data fields before you send them.


EDI Error 3: Failed Connection

Connection errors can interrupt the transmission of EDI documents. These errors typically originate from disruptions in a trading partner's EDI provider system or within their Value Added Network (VAN). Various factors, including network complications or cyber-attacks, are common culprits behind these connection errors.

How to fix and prevent connection errors:

  • Most connection errors are out of your company’s control. As a result, the best way to manage network errors is by contacting your service provider or VAN.
  • Reduce the impact of connection errors by implementing monitoring systems that detect and address connection issues promptly.
  • Choose an EDI provider or VAN with robust connection protocols that resolve errors quickly.


EDI Error 4: Problems in Message Sequencing

A message can only be successfully transmitted if the preceding message has been received by the intended recipient. Many messages are in a flow that requires your trading partner to reply before you can trigger the following message. For example, in a typical EDI flow, you would need to receive an EDI 855 Purchase Order Acknowledgement before you can send an EDI 856 Advance Ship Notice (ASN).

How to fix and prevent message sequencing errors:

  • Identify whether an error blocked the previous document or your trading partner simply hasn’t responded.
  • Set up the message flow so that errors are immediately reported.
  • Configure your ERP only to send messages after your partner has responded to your previous communications.


EDI Error 5: Incorrect Configuration

If you haven't set up your ERP system correctly, messages may fail due to incorrect system logic.

How to solve and prevent configuration errors:

  • Maintain robust master data protocols.
  • Automate set-up routines.
  • Ensure trading partners update their EDI configuration before they can save new records.


How to Prevent Future EDI Errors

EDI should propel your business toward success, not hinder it. But, poorly managed solutions can lead to unnecessary costs and setbacks. Let’s examine the best practices for maintaining an error-free flow.


Be EDI Compliant

Start by ensuring you are EDI compliant. Adopting the same EDI standards and data formats as your trading partners will prevent many errors because it helps their tech find important information in your documents.

There are general standards most businesses use as guidelines depending on location:

  • The U.S.: The ASC X12, also known as the “X12”, is the most commonly used EDI standard in the U.S. It was defined by a committee from the American National Standards Institute, a nonprofit that outlines standards for products, processes, services, and systems.
  • Outside the U.S.: The United Nations created the international EDI standard, known as the EDIFACT.

When sending EDI to a trading partner, ensure you match each other’s requirements and follow the same implementation guide.


Maintenance and Training

Invest in ongoing training for your employees and backup staff. This will ensure they’re well-versed in EDI best practices and equipped to identify and address errors promptly. It also helps to reduce work stress and fatigue, which can increase the risk of errors by up to 50%.


Test and Review Your System

Always test your system thoroughly when introducing updates, onboarding a partner, implementing new software, or switching data format–these times of flux often cause problems.

In addition, review how often your system reports errors to identify any weak spots in your performance. Confirm that your trading partners are happy with your communications to keep your business running smoothly. From there, you can maximize your performance and reduce the time it takes to solve errors.


EDI Monitoring and Visibility

Implement an EDI monitoring tool that gives you maximum visibility. That way, when problems occur, you aren’t trying to solve them blindfolded. Remember to update your master data protocols (the guidelines and procedures for managing core business information, such as customer and product data) regularly for compliance and ensure you have integrated them into your ERP system.


The Last Word on EDI Errors…

EDI is an incredibly efficient way to send messages, streamlining business communications. However, the potential for errors still exists. Often, in-house teams have other tasks to complete or can be expensive and challenging to hire.

The alternative is to implement an inexpensive supply chain EDI visibility tool like IntelligentXchange. IntelligentXchange monitors your entire EDI ecosystem and identifies issues before they cost you money or put trading partner relationships at risk. Don’t hesitate to reach out for a demo.