EDI & POS Systems
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EDI & POS Systems ATG 383 - Spring 2002 When to adopt technology? • “Things have to change to remain the same” • What do we want to accomplish? – Lower costs – Increase revenues – Comply with required standards 3 Technologies We Will Consider • Electronic Data Interchange • POS Systems • eXtensible Markup Language & eXtensible Business Reporting Language Electronic Data Interchange • Computer to computer exchange of business information in a standard format. • EDI is not faxes, email, or web sites. EDI - General Idea In-house system. In-house system. Translate into EDI format. Translate into in-house format. Transmit. Receive. EDI - Purchase Order Identify need. Create purchase order. Create sales order & continue processing. Translate into EDI format. Translate into in-house format. Transmit to vendor. Receive from customer. EDI - Acknowledgement Match P.O & acknowledgement. Create acknowledgement. Translate into in-house format. Translate into EDI format. Receive from vendor. Send to customer. Translate In-house Data to Common Standard • Translation process – Data fields in business applications are mapped to corresponding fields in EDI documents • Two Common EDI Standards – ANSI X12 in North America – EDIFACT outside North America • Following examples taken from: – http://developer.netscape.com/docs/presentations/xpert/edi/edi.html Example of Standards-Based EDI Message Interchange Group Header Functional Group Header Transaction A - 1 of 2 Transaction A - 2 of 2 Functional Group Trailer Functional Group Header Transaction B - 1 of 1 Functional Group Trailer Interchange Group Trailer EDI Network Options Three ways to connect Buyers & Sellers Direct Connection Partner A Partner B Value Added Network Partner A mailbox Van mailbox Partner B Internet Partner A mailbox mailbox Partner B Comparison of EDI & Traditional Systems EDI Traditional Faster processing Greater accuracy Lower start-up costs Stronger buyer - vendor relationship Available to big and small businesses What can go wrong with EDI? What are the controls? POS & Scanners Retail POS Systems • Captures and collects sales information at time of sale. • Technologies that are important for this: – Bar codes – Scanners & PCs – Off the shelf software Bar Codes Identify Products Bar Codes in Operation Scan Bar Code Add amount to customer’s purchase. Bar Code Number Product info & price Look up price & product info. Update sales & inventory records • Use POS data to track sales and manage inventory. • A few of the changes K Mart made: – Eliminate use of retail inventory method. – Ability to make inquiries of data as the day proceeds. – Find and adjust overstocked / understocked stores. • JC Penney sends POS data to VF Corp., maker of Lee and Wrangler jeans. • VF watches flow of stock and automatically updates a particular item once the quantity reaches an agreed-upon point. • VF uses a flexible manufacturing, allowing many small production runs. Some Advantages of POS • Better customer service. Faster. Fewer errors with proper controls. • More accurate inventory counting and control. • Increased productivity through automated systems. • Opportunity to integrate with EDI for improved replenishment time. Michigan Scanning Tests Store # tested # wrong JC Penney 54 18 Hudson's 59 11 Sears 63 11 Target 30 2 Mervyn's 32 1 Mont. Ward 15 4 Scanners and POS - What can go wrong? What are the controls? Using XML to Define Documents and XBRL for Business Reporting A Web Page HTML That Created A Web Page <HTML> <HEAD> <TITLE>Hello</TITLE> </HEAD> <BODY> <CENTER> <H1>Hello again</H1> </CENTER> </BODY> </HTML> EDI Message in XML Partial XML Document <!DOCTYPE Book-Order PUBLIC "-//EDItEUR//DTD Book Order Message//EN"> <Book-Order Supplier="4012345000094" Send-to="http://www.bic.org/order.in"> <title>EDItEUR Lite-EDI Book Ordering</title> <Order-No>967634</Order-No> <Message-Date>19961002</Message-Date> <Buyer-EAN>5412345000176</Buyer-EAN> <Order-Line Reference-No="0528837"> <ISBN>0316907235</ISBN> <Author-Title>Labaln, Brian/Chrome</Author-Title> <Quantity>2</Quantity> </Order-Line> <Order-Line Reference-No="0528838"> <ISBN>0856674427</ISBN> <Author-Title>Parry, Linda (ed)/William Morris</Author-Title> <Quantity>1</Quantity> </Order-Line> XBRL • XML based framework for exchange of financial information. • Example: – <DATE>July 26, 1998</DATE> • Describes the information, not the presentation. Format flexible. XML Tags: The Key • <item> – – – – <name>CashEquivalents.Cash</name> <label>Cash and Securities</label> <amount period=“1998”>2000</amount> <amount period=“1997”>1000</amount> • </item> Financial Statement Financial Statement XML/XBRL Summary • Operation of EDI • Operation of POS systems • Use of XML and XBRL
