EDI's direct impacts are to reduce the amount of data capture and transcription and the delay between despatch and receipt of messages. These generally result in a decreased incidence of errors, less time spent on exception-handling, and fewer data-caused delays in the business process. Benefits can be obtained in such areas as inventory management, transport and distribution, administration and cash management. It offers the prospect of easy and cheap communication of structured information throughout the corporate community, and is capable of facilitating much closer integration among hitherto remote organisations.
Using the funds generated from the first survey, the Group conducted a further survey in late 1991, focussed on EDI alone (GPIE II). The resulting report was published in September 1992, and concluded that "There has been considerable growth in EDI use by Commonwealth agencies during the last two years. This has been in a variety of different classes of EDI, but there has been only a limited growth in purchasing-related schemes. Unsurprisingly, however, the growth has not been as dramatic as responses to the previous survey suggested it might be". Those organisations which had implemented EDI, generally considered that the systems had produced sufficient and in some cases significant benefits. The primary constraints on faster growth were once again internal, especially the technology legacy, but also slow organisational adaptation to exploit the technology. A moderate number of organisations did, however, consider that the lack of EDI- capable business partners was a significant constraint.
In 1993, the group conducted a third survey of EDI Practices and Intentions of Agencies of the Commonwealth Government (GPIE III). This found that there had been disappointingly little progress during the previous two years, with only a couple of genuinely new schemes having been launched and only a few new participants won over to existing schemes.
A moderate number of organisations nominated that they intended to implement EDI schemes, particularly in the purchasing area. Many of these, however, were medium- rather than short-term plans, and some were clearly presaged on the assumption that a strategic impetus would be forthcoming from the Commonwealth Government. In addition, fully 40% of respondent agencies intended spending precisely nothing on EDI during the next two years. It was apparent that the key barrier to the take-up of existing schemes had become the lack of critical mass. It was a classic case of an initiative which was in everyone's interest, but no-one's interest; that is to say that individual agencies can gain little from EDI unless a sufficient number of business partners also commit.
The supplier population was defined as the top 250 suppliers to the Commonwealth Government, as identified by contracts published in the Commonwealth Government Gazette during the financial year 1992/93. This number was chosen on the basis that it was a manageable size, was likely to result in sufficient responses to provide a clear picture of the current situation in the marketplace, and because the number and value of contracts per company below the top 250 was not great. The Electronic Yellow Pages directory was used to locate the companies' addresses. Several further companies whose addresses could not be identified with any confidence were removed. This resulted in a total of 243 suppliers.
The instrument was developed with reference to questionnaires previously used by Electronic Trading Concepts Pty Ltd (ETC) for several State Government surveys, and by the Research Programme for the GPIE surveys. A series of discussions was held with Purchasing Australia. The questionnaire was tested with colleagues at the A.N.U., and piloted with a major Sydney-based corporation which was not on the list of suppliers, but was known to be actively using EDI with several of its customers. The questionnaire-based survey was supplemented by structured interviews with six of the respondents, who were users of EDI.
The quality of responses was variable. Some respondents gave every appearance of understanding, and having answers to, all questions. Other questionnaires showed evidence of comprehension difficulties, and internal inconsistencies. It was apparent, however, both from the high response rate and the nature of the replies, that the questionnaire was taken very seriously by the managers who completed them and the executives who took responsibility for the replies.
On the basis of response rate, informal analysis of the respondent and non- respondent groups, and the structured interviews subsequently undertaken, the research team beleives that a reasonable degree of confidence can be felt in the representativeness of the findings in this report.
The respondents were asked to nominate which organisation was the major sponsor of the EDI scheme they were involved in. Their own company was nominated (22 times), industry associations (10), and an EDI NSP (9). There appears to be no single existing scheme upon which the Commonwealth could readily build a critical mass of usage. This reinforced the judgement already made by the Department of Administrative Services that a gateway was needed, in order to facilitate connections to multiple schemes operating through multiple NSPs.
The use of EDI document standards was promising, with 35 of the 40 respondents stating that they used document standards. By far the most common were EDIFACT and ANSI X12, each nominated by 25 respondents. Also used were NEDIX/NEIS and proprietary standards.
Cost savings were only identified by 8 of the respondents, with the others stating that cost savings had not yet been made. Of these, 5 stated that costs savings were expected in the near future, especially when EDI was integrated into other applications, and 7 organisations noted that they didn't actually know whether or not cost savings had been achieved.
Around half of the respondents provided evidence of receiving other benefits from using EDI, especially better data or communications, improvements in service, reductions in leadtimes, and improvements in customer relations.
Respondents were asked how many sales-related EDI transactions they had sent to customers during the financial year 1992/93, and how many they had received. The distribution of their responses was as shown below:
This table confirms that respondents received more transactions from their customers using EDI than they sent, reflecting the fact that the purchase order was the most-used EDI document type. Interesting responses deserving of separate mention were:
Number of Transactions Sent Received
No Response 15 7
Zero 7 1
1 - 99 1 7
100 - 999 4 11
> 1000 6 7
Respondents were asked whether and when they intended to implement EDI. Of the 70 respondents to the question, over half had plans to implement an EDI system, most of those within the following two years. Only five of the respondents had no intention of implementing EDI.
A number of ways of making database, directory and sales catalogue data available to customers are possible, and respondents were asked which methods the organisation was using or seriously considering. A number of suppliers nominated using on-line databases, downloadable databases, and CD-ROMS, with many more considering them. Many were also considering using electronic bulletin boards.
The schemes in which these companies are participating are many and varied. So too are the standards being used, and the EDI network services suppliers to which they are connected. Almost half of the EDI-capable companies are connected to more than one EDI network services supplier. Multiple standards and networks are a fact of commercial life.
There is evidence of different companies and sectors perceiving EDI as making different strategic contributions. On the basis of the responses to this survey, purchasing dominates (14 clear references), with logistics second (8) and financial settlement third (6). The opportunity exists for the Commonwealth to build upon this preparedness to conduct business transactions electronically.
The SECSAGA project, in combination with previous surveys, has:
Roger Clarke is Reader in Information Systems at the Australian National University, and has directed the Research Programme in Supra-Organisational Systems since its inception in 1988.
Kevin Jeffery is a consultant with Electronic Trading Concepts Pty Ltd of Sydney, having completed undergraduate and graduate studies in accounting and information systems at the Australian National University.
Clarke R.A., Pedler M., Swatman P.M.C. & Campbell P.C. [GPIEEE] 'Commonwealth Government Practices and Intentions Relating to EFTS, EFT/POS and EDI: Survey Report' 100pp., Department of Commerce, A.N.U., September 1990
Clarke R.A., Campbell P.J. & Telfer S.G. [GPIE II] 'EDI: The Practices and Intentions of Agencies of the Commonwealth Government: 2nd Survey Report, 1991/92' 140pp., Department of Commerce, A.N.U., September 1992
Clarke R.A. & Jeffery K. 'GPIE III: Government Practices and Intentions in Relation to EDI: 3rd Survey Report, September-December 1993' 90pp., Department of Commerce, A.N.U., December 1993
Clarke R.A. & Jeffery K. 'SECSAGA: Survey of the EDI Capability of Suppliers to Australian Government Agencies: July-November 1993' 70pp., Department of Commerce, A.N.U., December 1993, rev. May 1994
Clarke R.A. 'EDI in Australian International Trade and Transportation' Proc. Conf. 7th Int'l EDI-IOS Conference, Bled, Slovenia, June 1994
Clarke R. 'EDI Adoption and Usage in Australian Government Agencies - 1989-1994' Proc. Conf. 5th World Congress of EDI Users, Brighton, United Kingdom, 14-17 June 1994
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