EDO: Russian proverbs and sayings as a mirror of the IT market

According to a study conducted by the EDI working group at the APKIT import and distribution commission, the volume of orders for documents that go through EDI did not exceed 30% in 2019 among the most successful distributors. And this is despite the fact that distributors have been connecting contractors (with varying degrees of activity) since 2016.

The partners' lack of desire to stop sending papers and start using electronic document management systems causes real problems for suppliers. And the loss of paper documents when sent by regular mail is only one of them.

At the same time, as can be seen from the report, second-level partners are in no hurry to implement electronic document management systems. And not because they don’t know how to do it better. Even those who have experience in implementing EDI systems with customers continue to work with "paper." Here is what a representative of one of the regional companies said on the condition of anonymity.

"We have been using electronic document management for about two years, but at present, we are only accepting documents from contractors, we are not transmitting them ourselves. Next year we plan to establish a full exchange. In general, the issue turned out to be rather painful for our company. After several iterations, we got to interview the chief accountant, who was reluctant to give us the above information. Problems with paperwork do exist at the moment, including loss of documents, non-receipt, duplication, etc. Therefore, we understand that, on the one hand, it would be necessary to make our EDI complete, but on the other hand, this can be done only after a full-scale restructuring of internal business processes has been completed. As integrators, we have experience in implementing EDI systems for customers, we have the necessary competencies for this, direct and successful contacts with developers. And we understand that no external factors can push us to this (it is not just about arranging the exchange of documents, for example, with distributors, but about setting up our workflow as a whole). Therefore, while we are moving towards the introduction of EDI, we are moving slowly, but conceptually it has been thought out so that the implementation would immediately, without subsequent improvements, fit into the general automated business management system.”

At the same time, as noted in the above-mentioned study, there is no pattern in which companies connect or do not connect EDIs: neither by the specialization of partners nor by their territorial basis. Resellers, retailers, and integrators from both Moscow and St. Petersburg, as well as from different regions, work through EDI.

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A survey of representatives of 12 distributors (conducted by the EDI team at the APKIT import and distribution commission) showed that there are at least three types of reasons why their counterparties are not connected to the EDI:

1. Lack of awareness of partner companies (they do not know much about EDI (especially regional companies), do not see the point, concerns/fears of accountants and management, concerns about claims from the Federal Tax Service and other government agencies, lack of security guarantees (paperwork is preferable, and the procedure works faster in case of litigation)).

2. Lack of technical and/or organizational readiness of counterparties. In most cases, before a partner connects to EDI, it needs to make many improvements and changes in business processes within the company. Not everyone is ready for these changes. This also included the counterparty’s reluctance to change the principles of document flow within the company, reluctance to mix paper and electronic document flow, the location of the warehouse and accounting in different territories, remoteness from each other (as a result of which internal problems arise in the procedures for approval and signing of documents), as well as lack of understanding of legal subtleties of the transition to EDI. Those companies that still have a small percentage of the “client base” working with EDI are not in a hurry to abandon the “paper”.

In addition, the survey participants noted that in a number of cases, proposals for connecting an EDI are simply “lost” within partner companies as they do not always go to a manager who could correctly assess the benefits of switching to electronic document management. This process is just as much hindered by the objections of the accounting office, which can be related both to the fact that accounting is conducted by a “visiting” specialist who “... rarely looks into the EDI system”, and to the fear of staff members that the introduction of EDI will be followed by staff optimization.

According to distributors, the EDI system is in the process of studying/debugging/settings for some partners with an unclear forecast as to its readiness. There are also dealers among those who are ready to work through EDI, but only with a certain set of documents (for example, letters, reconciliation certificates, TORG-2 acts, applications), i.e. not with primary accounting documents. In addition, many counterparties switch to EDI only if they have a full cycle of interaction related to sale, i.e. EDI documents come first (PRICAT, DESADV, RECADV, ORDERS, etc.), and they are followed by IDN. At the same time, the settings of EDI documents are not stereotyped, which means that this is an individual work (taking into account the requirements and technical characteristics) with each client. If the exchange of documents occurs through roaming, then this chain is complicated by several times, which leads to additional time costs for both refinement and testing of the system for all interested parties. In addition to this, some counterparties set requirements for the content of information in the IDN, which the distributor is not always able to implement without significant technical improvements in the system, so the transition to EDI is delayed for several months, or temporarily delayed.

3. Work with different providers (roaming). This is the number one problem as providers are very difficult to interact with each other, the logistics for setting up can be very long, and it takes a lot of time to coordinate. Due to problems with roaming, a decision is made with the counterparty to postpone switching to EDI (however, such problems are becoming less common). Not all providers are willing to exchange different types of electronic documents.

The list of reasons why second-level partners do not connect EDI is not short. Therefore, it is not surprising that most of them are in no hurry to “trouble trouble” until it troubles you, i.e. until it is impossible to do without electronic document management.

Distributors also recognize that not everything is going smoothly with the introduction of EDI so far <...> Distributors are absolutely sure that partners should seriously start thinking about introducing an EDI system at home. Moreover, this need is explained not only by the fact that sooner or later electronic document management will become mandatory in communicating with contractors, but also by the advantages that these systems bring to the life and business of IT companies.

MERLION (EDI was introduced in the spring of 2017) noted: “We motivate partners to work through EDI, and at the moment, both the number of companies exchanging documents without paper carriers and the list of types of these documents is growing. For example, the share of shipments to EDI partners is 40%, and this figure is constantly growing. Obviously, the EDI service is a tool that can significantly reduce various costs and increase the speed and efficiency of back-office units. Only the cost of paper, printing, storage and shipping can be reduced by 80%. Among the reasons why partners do not want to switch to EDI work, we distinguish two main ones: reluctance to bear a new type of expense and distrust of the reliability of services existing on the market. But these are subjective reasons, and we are trying to convey to the partners all the advantages and benefits of using EDI. For example, we explain that this is not about introducing an expensive solution in the traditional sense, but, in fact, about connecting to a ready-made service (with a pre-received electronic signature). Pay only when you use - in our offer, incoming documents are free, and the cost of outgoing documents is several rubles per document (depending on the rate). And EDI is beneficial as part of the capital expenditures is replaced by operating expenses.”

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But it has long been known that you cannot persuade someone to do something, promising partners only carrots. There is a second very effective tool, a stick. The synergy of these two instruments of stimulation works wonders. Therefore, we asked distributors to tell not only about the advantages that the partners connected to EDI will have, but also about horror stories for those who do not want to refuse paperwork.

And, according to the representatives of MERLION, the main thing for partners may be a “horror story” to lose competition because of the speed of their business: “Spending time and a considerable budget on the logistics of paper documents will soon become an unacceptable luxury.”