Strategic System Planning In Edi Implementation

Now a day, for efficient business transactions and faster movement of information and money, many organizations have started implementing EDI systems. Big organizations are encouraging their suppliers for implementing the same so that there is faster data movement with accuracy. But, there are lot many issues that need to deal with while implementing EDI system. Present paper discusses the strategic system planning required for EDI Implementations which includes: Determination of Business and Information Needs; Defining the EDI Targets; Defining and selecting EDI Strategy; and Developing the Implementation Plan

1. Introduction: While an EDI implementation may provide various cost saving opportunities, the more substantial benefits can often be obtained only by integrating EDI into an organization's business processes and transforming these processes as necessary to achieve the overall business objectives. Thus, in planning an EDI efforts, it may become clear that reengineering must be a critical component of a strategic EDI plan. More appropriately, EDI should be viewed as an enabling technology for reengineering; an EDI plan is therefore a part of a boarder CI program.

A strategic EDI system plan must:

o    Address the current and anticipated future business needs of an organization (the business drivers);

o    Align with the organization’s business and organization strategies;

o    Be consistent with and be an integral part of the organization's strategic information system plan; and

o    Address the key ingredients of an EDI program including:

    The EDI organization (i.e., the EDI function, the user function, the trading partners, and any third-party vendors such as value-added network service providers),
    The EDI infrastructure or foundation (i.e., translation software, communication, education, and support), and

•    The implementation strategy and plan (e.g., prioritizing application, adult, control and legal issues, package software implementation, custom system development, testing, and trading partner programs).

2. Stages of EDI System Planning: There are four stages of strategic EDI systems planning which can be described as under:

Stage I- Determine Business and Information Needs: An EDI initiative must align with and support as organization's business strategy. Thus, the purpose of Stage-I in EDI planning is to obtain an adequate understanding of an organization’s business environment, including the business drivers for implementing EDI, the influencing external environment factors, the internal operating environment, and the stakeholder interests. An understanding of the IS environment is also obtained to provide a basic, from an IS perspective, for identifying EDI opportunities and developing the EDI strategy. Method for maintaining the ongoing success of the program should be developed to ensure long term management support.
   
Stage II- Define EDI Targets:  Based on an understanding of the business and IS environment obtained in Stage-I, the main purpose of Stage-II is to envision the target EDI environment. The process begins with identifying opportunities to use EDI to support an organization's business strategy and enhance its competitive or strategic advantage. Target application are then defined and prioritized to support the identified EDI opportunities.

Stage III- Define and Select EDI Strategy: The prioritized target applications defined in Stage-II are the primary drivers in determining an EDI strategy in Stage-III. Specifically, the options for developing the target applications are determined, the required supporting IS technology components and architecture (including the use of EDI software and value-added networks) are determined, and a supporting organization/management in achieving an organization's business objectives.

Stage IV- Develop Implementation Plan: The final stage in EDI systems planning is to define the major projects required to implement the selected EDI strategy. The implementation projects include not just the application systems development/enhancement projects but also change integration projects (e.g., reengineering projects) and trading partner relationship development initiatives.


3. EDI Issues, concepts and techniques
i)Current IS Environment Support for EDI. An understanding of the components of the current IS environment is necessary to complete an impact analysis of implementing EDI. Specifically, the focus is on determining how well the current IS Environment – including its application systems, technology infrastructure, and IS organization and management- supports the planned EDI implementation and what additional resources will be necessary.

Some of the EDI issues and considerations include:

    Identifying current application systems that will be affected by the planned EDI implementation by analyzing their functions, data flows (including inputs and outputs) and interface requirements:

    Identifying opportunities for enhancing or integrating current application systems enables by planned EDI capabilities;

    Analyzing the communications capabilities (considering both software and hardware capabilities) of the current application systems and technology infrastructure to determine whether any upgrades or additional resources would be required to support the planned EDI implementation; and

    Analyzing the existing IS organizational structure (i.e. centralized, decentralized, or distributed) to determine its appropriateness in supporting the implementation and ongoing operation of EDI systems.

(ii)    Assessing the IS Environment.  The state of the current IS Environment may have a major impact on the EDI strategy. For example, the need to preserve current IS investments may be a major constraining factor in developing an organizations EDI strategy. Some of the concepts and techniques that may be used in assessing an organization's IS Environment include:

    IS Asset Value Statement. An IS asset value statement may be prepared to summarize the estimated current cost investments in various IS resources including hardware, software, data resources, staffing (including training), user costs and operating costs (including telecommunications costs). Deriving an IS asset statement is often subjective and difficult, as records often are not kept for many of IS resource items. However, even at a rough level, such a statement may be an effective vehicle for communicating to and getting the attention of senior management of the important role of IS (in financial terms) in the organization. It assists in providing a proper perspective for planning and managing the IS function and developing the IS strategy.

 Ageing Analysis. A simple yet useful assessment of the current IS Environment is to complete an aging analysis of the current applications and hardware/software components. It may reveal sources of existing IS problems (such as maintenance and reliability problems) and provide insights for developing IS strategies.

 Maintenance Needs. Assessment Maintenance needs may be assessed by analyzing the application development and maintenance backlogs, the maintenance budget. The types of maintenance, and the sources of maintenance problems. Understanding the maintenance needs, which may be a reflection of the quality of an IS Environment or the stability (or instability) of the supported business environment, may provide insight on determining target applications, developing migration strategies, and identifying system improvement opportunities.


 Business Coverage of Current IS Support. The business coverage (or lack of) of the current IS support provides a useful source of information for identifying IS opportunities for gaining competitive advantage and/or improving IS effectiveness. Business coverage may be determined by assessing how well current application systems and current application development projects support the business segment critical success factors. In addition, the appropriateness of the composition of the current application systems, portfolio, in terms of IS types such as strategic information systems, management control systems, and operational support systems, may be assessed considering the nature of the business environment.


 IS Strategic Grid.  The nature of the current IS environment may be determined using a strategic grid (Cash, Mc Farlan, and Mckenney (1992) considering the strategic impact of current applications and application development projects. Based on these two dimensions, an organization may be categorized into one of the following four IS management environments:

 strategic (high impact and high dependence).
 turnaround (high impact but low dependence)
 factory (low impact but high dependence), and
 support (low impact and low dependence).

The IS strategic grid may be used as a tool in understanding the role of IS  in the organization. Specifically, this knowledge is useful in developing the target IS organization and management infrastructure and assessing the appropriate.- ness of the application development portfolio rist. The grid may also be used as a high-level communication tool in explaining to management the nature of various IS environment (e.g. the “as is,” should be,” and “to be” environments). (See Exhibit 3.5)

 Systems Audit Grid The status of the current applications systems provides and important basis for defining target applications and determining application implementation options. A useful tool for assessing current application systems is the systems audit grid (Earl {1989}, which categorizes application systems, based on their assessed business values and technical values, into;

 those that should be eliminated (low in both business value and technical value) from the target environment.

 those that should be reassessed (high technical value but low business value) to determine if they should be retained in the target environment.

 those that should be renewed/replaced (high business value but low technical value) in the target environment, possibly through software reengineering, and

 Those that should be retained and possibly enhanced (high in both business value and technical value) in the target environment (See Exhibit 3.6)

 Assessment of Technology Maturity.  The development of IS strategies must consider the maturity levels of both the current and target technologies. In particular, the technology maturity levels of the current IS environment have a significant impact on the target IS organization and management strategy, which in turn may influence the target IS technology strategy.

A useful technique in assessing technology maturity is the technology assimilating model (Cash, McFarlan, and McKinney {1992) which identifies the following four phases of technology maturity:

    technology identification and investment,
    technology learning and adaptation,
    rationalization/management control, and
    maturity/widespread technology transfer.

 Software Maturity Framework. In addition to IS technologies, the maturity level of the current application development process should also be assessed in developing IS strategic. The information is useful in making IS strategy decisions such as identifying the target application implementation options, selecting application development methodologies and tools, and determining IS organization and management services.

4. Conclusion: For Implementing EDI in an organization, It is very important to find out key issues. The completion of the EDI implementation plan is a Formal Approval Point. The implementation plan should be submitted to and discussed with management to resolve any question or issues.  If necessity, a list of action items may be prepared. Formal approval and acceptance of the EDI strategy and implementation plan should be obtained from management.

There should be a clear consensus of what the next steps should be to implement the plan. Quite often, it is useful to include to suggested next steps for the organization to take to begin the implementation process. The key EDI issues, concepts, and techniques in developing as implementation plan include: Pilot implementation , and Migration Issues.

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