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The Debate is on: APIs vs. EDI - 3 Things to Know about Where Supply Chain Technology is Headed

By Jett Mc Candless, CEO, project44

Jett Mc Candless, CEO, project44

Application Programming Interfaces (APIs) are already transforming the global supply chain, an industry known for being resistant to change.

Just as APIs have overhauled other industries, bringing us the most dynamic, cloud SaaS (Software as a Service) applications of today like Uber, Apple Home and Google Maps, the supply chain is set to be the next industry for disruption. The only question that remains is not if, but when, APIs will reach critical mass and replace Electronic Document Interchange (EDI) as the de facto technology within the supply chain. Here are a few things to consider as we prepare for the inevitable shift:

1. How APIs fit into the current logistics landscape

EDI was first introduced to the supply chain in the 1970’s. Fast forward 45 years and this pre-internet technology is amazingly still driving communication in supply chain management systems. Supply chains cannot afford to run on this legacy technology any longer, especially with Amazon Prime and omni-channel buyers adding an immense amount of new pressure that requires always on, real-time exchange of information across the network. The only way for supply chains to keep up with these evolving demands is through API technology.

APIs are the fastest and most seamless way to access data and make informed decisions in the supply chain. Forbes recently dubbed them the “digital glue” holding our personal and professional worlds together, by allowing data to be transmitted from one system to another in nanoseconds. APIs create a proactive, automated supply chain that allows companies to identify risks, avoid issues before they occur and make informed decisions based on real-time data and a deep level of visibility. On the other hand, EDI holds the global supply chain hostage in a reactive and inefficient cycle.

“APIs are the only way to keep up with today's global commerce industry”

2. Why the shift from EDI to APIs is inevitable

By now you might be asking yourself, if APIs are so great, what’s the hold up with mass implementation? According to a recent report, most transportation companies haven’t made the switch to APIs simply because they don’t want to be the first to take the leap. There’s a fear of the unknown and a general distrust for new technology. Concerns about excess money and time spent on implementing a new system are also present.

While these concerns are certainly warranted, they are largely misguided. The integration of updated web services is less costly and far more time efficient than EDI (think: days compared to months). Easy-to-deploy solutions require very little maintenance and upkeep over time because unlike EDI, which defines what can be communicated, APIs simply define how the communication happens.

The efficiencies enabled by modern web-services ensures that data is synchronous and remains relevant to the business and structured through the same universal transport mechanism. Utilizing modern web service connectivity is critical for maintaining the required pace in a world that demands both speed and a deep level of visibility. Global commerce is not set to slow down any time soon and companies who can’t scale efficiently will fall off the map.The only way for companies to keep up is with the efficient and strategic use of APIs.

3. How to prepare for the inevitable shift

The next question to consider is how to most efficiently capture and maintain the many API integrations that enable supply chain connectivity. This process can be complicated and an influx of API integrations can create more complex and tangled many-to-many infrastructures. In order totackle these challenges in the most cost-effective and scalable way, companies should avoid a full “rip and replace” and instead buy or subscribe to a SaaS integration platform.

Accessing a third-party cloud solution will, with limited capital expense, enable IT teams to boost productivity, focus employees and budgets on more critical projects, lower maintenance costs relating to scale, and react faster to ever-evolving technology strategies. With a leased solution, your business will have access to the flexibility needed to reap the continued benefits of API connectivity.

APIs are the Unrivaled Winner of the API vs. EDI Debate

The stakes are too high for supply chains to continue running on legacy technology from the 1970's. APIs are the only way to keep up with today's global commerce industry. The shift from EDI to API technology is inevitable and transportation and supply chain companies should consider reevaluating their trepidations about adopting API technology sooner rather than later.