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Making the Move from On-Prem to Managed EDI Software (And Back Again)

Enterprises are embracing managed EDI services, entrusting specialized providers to handle mapping, translation, and all the other technical requirements.

February 28, 2024

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Migrating to managed EDI opens the door to scaling capabilities on demand, which suits both veteran businesses looking to modernize their trading processes and newcomers seeking cutting-edge solutions without the in-house hassle.

But it’s not all one-way traffic. What about those companies that want to reverse–from a managed system to an in-house system? This happens, too. Although we don’t see it discussed enough.

This article seeks to demystify the process of transitioning both to, and from, managed EDI services. And why your company might want to make the move.


Understanding Managed EDI Services

Firstly, let’s recap managed EDI.

By outsourcing EDI tasks to an external team of experts, managed EDI enables businesses to focus more on their core operations while leaving technical trading tasks to seasoned professionals.

This model provides several key benefits:

  1. Cost Efficiency: One of the primary advantages of managed EDI services is reduced overhead costs. Businesses can save on investing in infrastructure, software, and the hiring and training of specialized personnel.
  2. Expertise at Your Fingertips: Managed EDI providers are specialists in their field. They bring a wealth of experience and knowledge, ensuring clients follow the latest standards and best practices.
  3. Scalability: As a business grows or experiences fluctuations in demand, its EDI needs will change. Managed EDI services are inherently scalable, capable of adjusting to increased transaction volumes or expanding to new markets without additional internal resources.
  4. Focus on Core Business Functions: With the technicalities of EDI offloaded, businesses can redirect their internal resources toward growth-critical activities. This allows for a more strategic allocation of capital towards innovation and strategy.

Contrasting this with traditional on-premises or legacy EDI systems, managed services offer agility and cost-effectiveness.

That’s not to say in-house EDI is the lesser option–it just represents a different method of handling trading relationships.

‘Reverse migration,’ or moving back from managed to in-house EDI, does happen.

For example, a business may gain the budget to hire its own dedicated EDI team. Or develop a need for greater control over processes and data.


Making the Move to Managed EDI

The process of transitioning to a managed EDI service from an in-house system varies with your setup and hardware. Here are the key steps:

Step 1: Assessing Current EDI Infrastructure

Begin by thoroughly reviewing your current EDI setup. This involves evaluating existing systems, understanding integration with other business applications, and identifying any limitations.

It is essential to document the types and volumes of EDI transactions your business handles and how they integrate with your business processes.

If you’re running an in-house system with your own hardware, work with IT to identify the infrastructure it depends on.

Step 2: Pinpointing Business Requirements

The next step is defining your business needs and objectives for EDI.

Whether you aim to improve transaction efficiency, reduce costs, enhance partner collaboration, or become truly scalable, it's crucial to align these goals with the capabilities of the managed EDI service.

Step 3: Selecting the Right Managed EDI Provider

Look for a provider with a strong track record in your industry and the ability to meet your specific requirements–today and in the future.

For example, 1 EDI Source offers both cloud, managed, and installed on-premise options that can cater to many business needs, ensuring a fit for current requirements and future growth.

Step 4: Transitioning Process

The transitioning process involves migrating data, maps, and settings from an in-house or legacy EDI system to the managed provider. These are the basic steps:

  • Data Migration and Security Protocols: Migrating data to the managed EDI service requires careful planning to maintain data integrity and security. This includes establishing secure data transfer protocols, encrypting sensitive information, and verifying data accuracy post-migration to check for corruption. P2V (Physical to Virtual) migration is the process typically used to shift data from on-premises systems to the cloud.
  • Network Configuration and Partner Coordination: Coordinate with your trading partners to ensure their systems are compatible with the new network(s). This may involve updating network configurations, modifying communication protocols, and ensuring that both ends of the data exchange are correctly aligned.
  • Testing and Validation of EDI Transactions: Rigorous testing is essential. Validate all EDI transaction types (purchase orders, invoices, etc.) to correctly process them through the new EDI system. This includes checking for any data translation issues and confirming that transactions meet all compliance requirements.
  • Customization and Workflow Optimization: Workflow automation is a core benefit of EDI. Transitioning represents the perfect opportunity to optimize existing workflows and create new ones to boost efficiency organization-wide.
  • Post-implementation: Ensure your team is well-trained on the new system and continuously reviews its performance, monitoring the EDI transactions for anomalies or inefficiencies.

The transition process might sound long and arduous, but it doesn’t have to be. A managed EDI provider like 1 EDI Source can support you every step of the way, from data migration through customization and training.


The Reverse Transition: From Managed EDI to In-House

There are several reasons why companies might want to transition from a managed EDI service to an in-house system. They might wish to have greater control over their EDI operations. Or want to integrate EDI with complex or proprietary internal IT infrastructure.

Whatever the reason, with 1 EDI Source, making the move is painless. That’s because, unlike most EDI providers, we let you take all your maps. It doesn’t matter if you migrate to our flagship solution–EDI HQXchange™ [HQX]–or to a different provider altogether. There’s zero tie-in and minimal re-work.

Here’s the process:

Step 1: Preparing for Transition

The transition begins with thoroughly assessing your internal capabilities. This includes evaluating your IT infrastructure, ensuring that it can support the in-house EDI system, and assessing the skills and resources available within your team.

Next, it’s time to develop a comprehensive plan that outlines the steps, timelines, and resources required for the transition. It's crucial to consider how this change will impact your current EDI operations and plan accordingly to minimize disruptions.

Step 2: Retrieving and Securing Data

Transferring EDI data from the managed service provider to your in-house system is fundamental to a smooth transition. This includes transactional data as well as EDI maps and configurations.

Maintaining stringent security measures to protect your data throughout this process is paramount. This is especially crucial during the transfer phase when data is most vulnerable.

Migrating between systems is easier when you stick with the same provider, as would be the case when migrating from 1 EDI Source’s MX to HQX.

Step 3: Implementing an In-House System

Set up your in-house EDI system, configuring it to handle the types of transactions and data formats you require. For those transitioning from MX to HQX, you can keep the EDI maps and configurations you already own to replicate your existing setup.

Ensure the new system integrates seamlessly with other business software like ERP, CRM, and supply chain management tools.

Step 4: Training for In-House Management

Equip your team with the necessary skills to manage the in-house EDI system. This includes training on the new software, understanding EDI standards, and managing day-to-day operations.


Summing Up

Transitioning between different EDI models, whether from an on-premises/legacy system to a managed service or vice versa, requires careful consideration and strategic planning. But with the right provider on your side, it’s actually pretty effortless.

At 1 EDI Source, we understand that companies and their priorities evolve over time. We have years of expertise in transitioning clients from an in-house EDI solution to a managed or cloud-based solution. We also have experience migrating clients from a managed or cloud EDI provider to an in-house setup.

Our team can guide you through any EDI migration scenario smoothly while minimizing disruptions. Unlike many providers, we give you ownership of all your maps and transactions. So, if and when the time comes to make the move, it’s a fast and frictionless process.

Contact one of our EDI experts to learn more about EDI migration with 1 EDI Source.