Unlocking Efficiency: How EDI Reshaped Assa Abloy and the Industry
In an increasingly fast and competitive market, companies are constantly seeking ways to streamline their operations, reduce errors, and enhance efficiency. Assa Abloy, a leading provider of innovative access solutions like doors, door and window hardware, mechanical and smart locks, access control and service, found itself facing a set of common business pain points: errors in data entry, reliance on paper-based systems, and a significant investment in order entry human resource. However, they didn’t just grapple with these issues; they took decisive action by implementing an Electronic Data Interchange (EDI) solution in collaboration with EDIStech, that transformed their business operations.
The Pain Points:
- Errors in Data Entry of Customer Orders: Like many companies, Assa Abloy encountered issues with errors creeping into the data entry process of customer orders. These errors could result in incorrect deliveries, billing discrepancies, and, most importantly, unhappy customers.
- Paper-Based Systems: The reliance on paper-based systems was holding them back. Manual processes tend to be slower and are more susceptible to human error, limiting the company’s ability to deliver information in real-time and ultimately, manufacture and deliver products efficiently.
- Significant Investment in Order Entry Teams: Assa Abloy had invested heavily in order entry resources who were responsible for manually entering customer orders. This human-intensive process was both time-consuming and costly.
The EDI Solution:
Assa Abloy’s forward-thinking approach involved implementing an Electronic Data Interchange (EDI) solution to address these pain points head-on:
- Linking Assa Abloy to Major Customers via EDI: They established electronic connections with their major customers through EDI. This innovation allowed for more seamless and efficient communication within their supply chain, reducing errors and delays. Effectively, getting Assa Abloy’s systems easily communicating and synchronizing with the relevant systems and processes of their suppliers.
- Customized Order Entry Web Portal: Recognizing that not all customers could immediately adopt a fully automated EDI solution, Assa Abloy developed a tailored Order Entry Web Portal. This user-friendly portal offered smaller customers an easy way to place orders electronically.
- Elimination of Manual Data Entry: One of the most significant benefits of the EDI solution was the elimination of manual data entry for sales orders. Orders from both the Full EDI system and the Web Portal were automatically uploaded into Assa Abloy’s ERP system. This streamlined process reduced the risk of errors and accelerated the order processing workflow.
The Benefits of the EDI Solution:
The implementation of the EDI solution brought forth a multitude of benefits for Assa Abloy:
- Accelerated Business Pace: With electronic data interchange, the flow of information became not only more accurate but also significantly faster. This resulted in a substantial increase in the speed of business operations giving all stakeholders visibility and manageability of real-time information and decision making.
- Improved Production Scheduling and Deliveries: Orders entered the production scheduling pipeline much more rapidly. Consequently, this led to speedier deliveries to customers, fostering satisfaction and competitiveness.
- Efficiencies and Cost Savings: By connecting to major retailers in New Zealand through EDI, Assa Abloy achieved noteworthy efficiencies and cost savings within its supply chain. EDI simplified communication with partners and minimized manual processes, resulting in time and resource savings.
- Elimination of Manual Intervention: A key achievement of the EDI solution was the complete elimination of manual intervention in the order processing workflow. All customer orders, regardless of their size, were seamlessly received electronically and integrated into the ERP system. This automation significantly enhanced both the speed and accuracy of order processing.
Industry Research Statistics:
Industry research supports the notion that Assa Abloy’s adoption of EDI is part of a larger trend in the business world:
EDI Adoption Rates: According to a study by Supply Chain Insights, EDI adoption rates among businesses have been steadily increasing over the past few years. In 2022, 75% of surveyed businesses reported using EDI to some extent in their supply chain operations, up from 63% in 2019.
Efficiency Gains: A report by the Association for Operations Management (APICS) found that companies implementing EDI solutions reported significant efficiency gains. On average, they reduced order-to-ship cycles by 20% and decreased data entry errors by 30%.
Cost Savings: Research by Deloitte indicates that EDI adoption can lead to substantial cost savings. In a case study, a manufacturing company reduced order processing costs by 35% and achieved an ROI of 450% within the first year of implementing an EDI solution.
Competitive Advantage: The Aberdeen Group’s research suggests that companies embracing EDI technology often gain a competitive advantage. They found that businesses with EDI capabilities were 35% more likely to have better visibility into their supply chain operations, enabling them to respond more quickly to market changes.
Assa Abloy’s proactive adoption of an Electronic Data Interchange (EDI) solution showcases the transformative power of technology in modern business. Their success story aligns with industry research, indicating a growing trend towards EDI adoption, efficiency gains, cost savings, and a competitive edge. Embracing technology and innovation, as Assa Abloy did, can indeed unlock new horizons in business excellence, allowing companies to stay ahead in today’s dynamic marketplace.
- Finance Automation: The Future of Electronic Data Interchange (EDI), Deloitte, 2021. Read the full article here: https://www2.deloitte.com/content/dam/Deloitte/za/Documents/financial-services/za-Future-of-EDI-Final-POV.pdf
- Supply chain analytics adoption: Determinants and impacts on organisational performance and competitive advantage, Kalaitzi and Tsolakis, 2022. Read the full article here: https://www.sciencedirect.com/science/article/pii/S0925527322000597
- APICS Supply Chain Operations Reference Model SCOR. Version 12.0, APICS, 2017. Read full article here: https://www.apics.org/docs/default-source/scor-training/scor-v12-0-framework-introduction.pdf?sfvrsn=2
- Aberdeen Research Report: AP Invoice Management in a Networked Economy, Pezza and Jan, May 2012. Read the full article here: https://www.slideshare.net/Anybill/invoice-mgmtnetworked-final-report