Key Messages in Automotive EDI Guarantee Supply Chain Efficiency: DELFOR, DELJIT, DESADV, INVOIC
In the automotive sector, the importance of communication between partners is characterized by heterogeneity and immediacy throughout the supply chain. The supply and production chains are very complex and can be very fragmented. It’s a sector based on planned production in which all actors must be coordinated.
Therefore, manufacturers and their suppliers need technological allies that allow them to comply with the Just in Time policy and avoid communication errors that may impact subsequent chain processes and ultimately the final consumer.
EDI has been positioned for years as one of the most implemented technologies in the sector for production planning, stock breakdowns, logistics, transport and etc. Thanks to electronic communications, a company in the automotive sector can guarantee that its processes are carried out in the right conditions and at the right time.
Assemblers, great promoters of this type of document exchange, have expanded their use not only to Tier I, but also to Tier II and Tier III with the objective that all partners can work with the same information and make processes more efficient.
How does EDI usually flow in the automotive sector?
There are basic messages that are exchanged more often in the automotive sector.
The first is the one that responds to an order: Delivery Forecast or DELFOR. It can be used for both closed and open orders, pending planning. It is a structured message that is sent from the manufacturers (OEM) to the Tier I suppliers and in turn to the Tier II suppliers.
A message related to DELFOR is the DELJIT (Delivery Just in Time) message or X12 862. This message, sent by a manufacturer who places an order, provides the supplier with accurate information about the delivery sequence and Just in Time requirements that complement the DELFOR message. It provides details about OEM requirements regarding shipment planning in short periods of time, usually 24 hours.
After the order, the dispatch advice (DESADV or 856 ASN) is used. The EDI dispatch advice message verifies that the merchandise received by the customer matches the purchase order. It shows the contents of the package and some additional information about the shipment such as details about the order, the product description, its characteristics, the type of packaging, the brands, information about the operator and the configuration of goods within the transport equipment. The dispatch advice message is sent from the suppliers to the recipient of the purchase, with the aim of improving the delivery management process for products. Also, distributors can control stock and the order entry process more efficiently. This is due to total traceability during the process, which allows knowing when the merchandise will be sent, when it will arrive and all other details about it.
Finally, the invoice will be the document that closes a purchase process. In the X12 language, it is the 810 message and for the EDIFACT and ODETTE standards it is called INVOIC. Additionally, suppliers also send it to the manufacturers who have requested the product. In some cases, first tier manufacturers or suppliers decide to implement self-billing, which is just an invoice message they send to their suppliers.
How to automate the message flow to optimize the supply chain in the automotive industry?
The volume of partners and messages to be exchanged in the supply chain and its management requires integrated and automated solutions that allow manufacturers and suppliers to dedicate time and personal resources to the most relevant functions. With an integrated electronic data interchange solution, companies will automatically receive commercial documents in their ERP systems and will be able to manage them immediately.
The automotive sector works via EDI with its own formats structured in the standards defined by the sector (EDIFACT, X12, ODETTE…) and communication protocols such as OFTP2, which is prepared to exchange confidential commercial information and heavy files such as CAD files. The companies of the automotive industry operate globally and need solutions for exchanging data with global partners while respecting the characteristics of each region. The use of standards worldwide facilitates the exchange of information and streamlines the production processes in companies.
OFTP2 Communication Protocol Replaces ISDN in Automotive Sector
EDICOM offers any company in the automotive sector a Global EDI platform that’s capable of sending and receiving messages with any partner in the world. After extracting information from an ERP system, EDICOM’s platform automatically transforms it into the format required by the destination ERP system and sends it through secure communication channels.
EDICOMNet is EDICOM’s value added network, an integral service for the transmission of critical data in B2B environments. It is a multi-standard network, able to route all types of messages (EDIFACT, X12, XML, FACTURAE, etc.). It is also a multi-protocol network, which can be accessed by Web services, https, FTP, x400, OFTP2, AS2, AS4, and etc.