EDI and ODE — what’s the difference?

Electronic document workflow is now replacing paper-based workflow in various business sectors. There are 2 main directions in electronic document workflow that have emerged: EDI and ODE. Let’s look at the features of each of them in this article.

EDI — electronic data interchange

EDI is a structured file exchange that streamlines the ordering and delivery of goods in retail. This system originated in the 1970s in the United States. At that time, each company kept stock accounting in a different way, which led to lengthy ordering processes for retailers. Therefore, there was a need to standardize the process of supplying goods and the data required for this.

In an EDI system, the data is organized into a structured order file. The retail chain then transmits the data to the supplier. It provides details of the goods ordered, their quantity, price, delivery date and destination warehouse. The supplier then confirms, adjusts, or rejects the order in response.

Both supplier and chain have preliminary settings in place for exchanging messages according to a single standard and ordering goods. EDI is a kind of bridge that converts all messages into a standard format that both parties can understand. The company can receive such messages on the EDI platform or in its accounting system (if it has integrated it with the EDI service).

What types of messages are provided in EDI?

The EDI standards define over 100 types of documents used in the supply of goods. The most significant ones are:

• order (ORDERS) — a document with detailed information about goods or services ordered from a supplier;
• order response (ORDRSP) — a document stating that the supplier confirms or does not confirm the delivery of the ordered items in full or in part;
• shipment notification (DESADV) — an electronic document containing information on the successful shipment of goods from the warehouse, which contains detailed information about the items;
• waybill (DELNOT, COMDOC) — an electronic document certifying the transfer of goods from the customer to the recipient or carrier;
• invoice (INVOIC) — an electronic invoice for payment for goods, etc;
• product catalog (PRICAT) — an electronic list of goods containing detailed data on them: product code, description, price, size, weight, color, expiration date, etc.

The delivery of goods is completed with the signing of a legally significant document that confirms the business transaction—the delivery of goods. In the majority of cases, this is an expenditure invoice. The supplier sends the invoice, which has already been signed, to the chain for verification. The chain also applies an electronic signature.

ODE — electronic document workflow

The electronic document workflow, as well as the paper workflow, comprises multiple stages: creation, approval, signature, exchange, and storage of documents. In order to achieve this, we utilize secure platforms, namely ODE services.

ODE addresses business processes within a company that require the execution of legally significant documents. For instance, in retail chains, in addition to the supply of goods, there are other areas of work that require documentation. These include:

• concluding contracts with suppliers
• leasing premises
• personnel records, etc.

The processing of electronic documents is considerably faster than that of paper documents. The risks of document loss and errors in ODE are significantly reduced.

The current legislation regulates electronic document workflow. A qualified electronic signature (QES) provides legal validity to electronic documents.

ODE solutions enable the exchange of a wide range of electronic documents. They facilitate various areas of company operations, including:

• electronic contracting (agreements, additional agreements, contracts);
• HR ODE (personnel orders, personnel records, P-2 form);
• electronic exchange of primary documents (invoices, cash orders);
• financial ODE (reports, statements, receipts).

Can EDI and ODE work in conjunction with each other?

The supply chain encompasses the generation of legally significant documents, including goods delivery notes, receipt notes, and bills of lading. Consequently, they are displayed in the EDI system. EDI services allow users to create, sign, and send documents to counterparties. Additionally, an invoice can be created in the ODE service or in the accounting system.

In practice, accountants typically create invoices within the accounting system. Subsequently, they can transmit the invoices to the partner via EDI or ODE. In the event that the accounting system is not integrated with EDI, the invoice can be recreated in the EDI service. This allows accountants to keep track of which order the invoice is linked to.

Vchasno offers a comprehensive range of services, including EDI and ODE platforms. Documents created in Vchasno.EDI are automatically duplicated in Vchasno.ODE. In both services, a single document signing process is conducted, after which the invoice is stored in the Vchasno.ODE archive.

What digital tools do trading companies require?

EDI and ODE address distinct business needs. However, both systems can be used to automate processes within a company. Consequently, they may be utilized in conjunction with one another.

The transition to electronic documents is a gradual process, based on each trading company’s specific requirements. Consequently, they are able to implement EDI or ODE at different stages of automation. For instance, the UltraMarket supermarket chain has implemented this approach.

A crucial document in the supply of goods is the bill of lading (TTN). It is necessary at the delivery stage and contains quantitative data about the goods, information about the vehicle, etc.

The government has announced the transition to electronic bill of lading after the end of martial law. However, trading companies are already able to test the services of electronic bills of lading from official providers.

An electronic bill of lading is an integral component of the supply chain. EDI platforms, such as Vchasno.EDI, can be used to create the electronic bill of lading. Additionally, it can be generated in a separate service called Vchasno.TTN, which enables drivers to utilize it when delivering goods.

In order to sign an eB/L, all participants in the transportation process (sender, driver, and recipient) must have a QES. In practice, it is not always possible for the driver to sign an eB/L with a file or hardware key. For this reason, the optimal solution is a cloud-based electronic signature.

The use of electronic signatures will streamline the goods acceptance process. In most cases, all goods receipt notes are signed by the chief accountant of the chain. Consequently, companies are striving to optimize their supply chain workflow and sign electronic receipt notes. In such cases, the employees accepting the goods must have a QES.

The ecosystem of Vchasno services

Vchasno provides services to help trading companies address numerous present-day challenges:

• Vchasno.EDI is a platform for exchanging structured EDI messages.
• Vchasno.ODE is an electronic document exchange service.
• Vchasno.Kasa is a software registrar of settlement operations for trade.
• Vchasno.KEP provides secure electronic signatures and seals.
• Vchasno.TTN offers an electronic bill of lading from the official provider of eB/L in Ukraine.

Vchasno services are designed to be easily integrated with one another. The likelihood of technical errors is significantly reduced.