Realizing procurement EDI processes with ANSI ASC X12, EDIFACT, and IDocs

German version

If you prefer to read this article in German, you may find a translated version under this link.

Introduction

Most of today’s procurement processes heavily depend on the use of electronic data interchange (EDI). Depending on the industry, different procurement concepts are applied. In the automotive industry procurement is mostly based on scheduling agreements, delivery forecasts and the like. If you are further interested in that topic, please refer to our previous blog post.
In the following article, we will investigate classic procurement, based on orders, order response messages, dispatch advices etc. First, we introduce the typical document flow taking place between a supplier and a buyer. In the second part, we introduce a matrix for the correct mapping between ANSI ASC X12, EDIFACT, and SAP IDocs.

Overview of used document types

The following Figure shows a typical document flow between a supplier and a buyer.

The supplier provides the buyer with a current list of its products, product details, as well as price information using a price catalog message (PRICAT). One often refers to this process as product master data exchange.
Based on the previously exchanged master data, the buyer orders goods from the supplier using an order message (ORDERS). The order message typically contains coded information about the buyer, supplier, delivery point, products, etc. By coded, we mean that unique identifiers such as global location numbers (GLNs) or global trade identification numbers (GTINs) are used for the identification of the involved business partners and their products.
In case the requested quantity changes, the buyer may emit an order change message (ORDCHG), signalizing the supplier a change of the amount of ordered goods.
The supplier may acknowledge a received order message or a received order change message using an order response message (ORDRSP).
Before the supplier ships the goods to the buyer, a dispatch advice message (DESADV) is sent to the buyer. Using the dispatch advice message, the supplier provides the buyer with information about the shipment including number of pallets, pallet identification numbers such as serial shipping container codes (SSCC), net and gross weight, identification of the transport vehicle such as license plate number of the truck, etc. Using this information, the buyer may coordinate the arrival and processing of the goods-to-arrive, e.g., in case of cross-docking-scenarios, frozen goods, etc. Furthermore, the buyer may verify the completeness of the shipment by comparing the received goods with the information provided in the previously received dispatch advice message.
After the goods have been received by the buyer, the buyer may emit a receipt advice message (RECADV), confirming the amount of received goods. The amount of confirmed goods in the receipt advice may be different from the amount communicated by the supplier in the dispatch advice. Reasons for such a deviation may for instance be damaged goods the buyer refuses to accept or a wrong number of goods shipped by the supplier.
Finally, the supplier sends an invoice message (INVOIC) to the buyer, indicating the amount, which has to be paid including any rebates, surcharges, taxes, etc.
Please note that not necessarily all document types are employed in every given business scenario. The German retail industry, for instance, heavily relies on orders, dispatch advices, and invoices. Order change, order response, and receipt advice are slowly gaining importance now. The apparel industry, on the other hand, heavily relies on price catalogs, since assortments of goods change frequently (spring collection, summer collection, etc.). In the apparel industry, we also encounter vendor managed inventory concepts (VMI), where the supplier is responsible for keeping the stock on the buyer’s side on the right level. VMI requires additional document types such as inventory reports and sales reports, which we will cover in a future article.

Mapping to IDoc types

In order to process the different document types in an SAP system, we have to use the correct IDoc types. The following table gives an overview of the different document types and their equivalent types in EDIFACT, ANSI ASC X12, and SAP IDoc. The two rightmost columns show the IDoc basic types and message types, which may be used to import/export the data to/from an SAP system.

Click here for a high resolution version of the image.
The used basic types and message types may be different, depending on the application scenario, e.g., custom Z-types may be used.

Summary

EDI standards are the backbone of today’s procurement processes. In order to correctly process the sent and received information in an SAP system, the correct IDocs must be used.
Due to the multitude of different EDI standards, EDI standard versions, and industry as well as company-specific subsets, one must usually employ an EDI converter solution. The EDI converter solution correctly translates between the external EDI standard and the SAP internal IDoc representation.

Questions or remarks?

You have questions or remarks in regard to EDI in the context of procurement? Please leave a comment or let’s get in touch – I am happy to discuss your thoughts!


Source: https://blogs.sap.com/2017/09/05/realizing-procurement-edi-processes-with-ansi-asc-x12-edifact-and-idocs/