Key Concepts to Succeed with B2B Data Integration Part I
B2B data integration is a multi-nuanced effort, an undertaking which takes considerable hard work to get right. The path to implementing a B2B strategy is not straightforward. Enterprises should step back think afresh, and have a deeper look at its important concepts.
In this post, I will discuss some important workarounds to help you get started and succeed with B2B data integration.
B2B data Integration: What is it, and Why it is Important?
B2B data integration is an imperative in this age and day. It inherently involves automated electronic data interchange between enterprises. It is a strategic approach to connect business-critical IT applications between partners, customers, etc., and improve electronic data interchange in a fast and agile manner.
How Does B2B Data Integration Work?
In a typical B2B integration scenario, data is generated by a source application which could be an Enterprise Resource Planning (ERP), Client Relationship Management, or Accounting System. The originated data can be purchase orders, sales data, invoices, etc.
This data is mapped to an industry standard like Electronic Data Interchange for Administration, Commerce and Transport (EDIFACT), Extensible Markup Language (XML), or American National Standards Institute (ANSI).
In the next stage, these files are processed to B2B constituent as a message standard or protocol like AS2, AS4, or SFTP. These standards are dictated by the trading partner.
Trading partner receives this data in an industry format and converts it in a format required by an application. All this mapping and ingestion is performed by a centralized gateway. This gateway enables messages to be sent or received for business-critical transactions.
Here are some important elements of a standard B2B integration process:
B2B integration primarily aims to break down silos and move data seamlessly in a multi-dimensional network. The data is extracted from source applications and published in a way that it can be accessed and consumed by other applications in any ecosystem. The extracted data can be a Purchase Order, Invoice, or receipt from an ERP system. It becomes possible to extract data not only once, but unlimited times in a strategic manner. Extracted data can be transmitted to external partners without difficulty.
Transforming data into a comprehensive format is one of the most time-consuming tasks in a B2B process. That’s because the data is not standardized. Architectural differences, design models, and proprietary formats make it difficult for enterprises to share data with their partners. B2B integration simplifies this part by converting structured or unstructured data into standardized formats, i.e., EDI, XML, CSV, etc. for easily integrating it with enterprise business systems. This is the reason that data transformation and mapping is a mission-critical capability for B2B integration.
Another relevant component for peer-to-peer data interchange is a communication protocol. B2B partners need to agree upon a transport mechanism for determining how to send a message in any format. Partners need to establish a logical connection with each other for exchanging information after evaluating the workloads. The following aspects should be evaluated:
- The data is private or public
- Formats in which the data needs to be delivered.
File size and transfer methods.
An ideal B2B integration approach helps enterprises in establishing a unified message exchange mechanism that supports all document types for faster data exchange. It supports protocols like AS2, SFTP, HTTPs, Web Services, and high-speed file transfer to facilitate data exchange. This advantage helps companies in becoming more agile and responsive.
The last important element of B2B integration is a target application where the data needs to be processed for making it available and accessible to other systems. Target application needs to transform data for sharing it across applications. Many enterprises use web portals for uploading information, mapping it into standardized format and piping it across applications.
Over the years, these b2b components were delivered through manual and homegrown approaches. However, API led hand-coded approaches cannot align these components with business objectives in an efficient way. These approaches are difficult to scale as per ever-changing business requirements and technology innovations. Enterprises face dilemmas in onboarding new partners, connecting with partners, etc. Longstanding challenges slow down strategic initiatives and time to revenue.
Pitfalls of Conventional B2B Data Integration Approaches
Most B2B integration solutions are still developed using homegrown and API led approach. However, these conventional methods are cumbersome, time-consuming, and resource intensive. Although API led B2B approaches have low upfront cost, but overheads rise when more partner networks need to be connected or accommodated. Manual data entry and formatting cause data errors that create setbacks in the long run. Enterprises are left with a complex web of coding to connect with differentiated architectures which their potential from gaining value.