What's Next for EDI? Be Part of the AIAG Survey

[Transcript]

[00:00:00] Jan Griffiths: This is the Auto Supply Chain Prophets Podcast, where you'll hear from experts of all facets of supply chain in the auto industry to help you prepare for the future. I'm Jan Griffiths, your co-host and producer.

[00:00:17] Terry Onica: I'm Terry Onica, your podcast co-host. Let's dive in.

[00:00:23] Jan Griffiths: Hello, and welcome to another episode of the Auto Supply Chain Prophets Podcast. Let's check in with my co-host, Terry Onica. Terry, what have you been up to?

[00:00:32] Terry Onica: I have enjoyed fall running this year more than ever. Wow, the colors have been amazing. I went down to Pennsylvania and ran a half marathon there. And been running, it's called the Hootenanny, but you run around a two-mile lap for as long as you can. So, I couldn't, unfortunately, run all day. It's a 12-hour open course. So, I did 10 miles, but a lot of my friends accomplished 40 miles and 50 miles. So, it's really super fun, but been loving the weather and all the bright colors this year.

[00:01:05] Jan Griffiths: I love that. I've not been out as much as I would like. As you know, I'm a walker, not a runner, and I've been focusing on culture workshops. I think the industry is finally getting it, Terry.

[00:01:18] Terry Onica: They are. That's awesome.

[00:01:20] Jan Griffiths: I know, right? I've been running one after the other after the other. And we're opening up discussions about culture. What is it? What does it need to be as we move from command the control to authentic leadership? And what I love about it is we're actually asking people for their input. And so often, when we try to implement change or transformation, it comes from the top, right? And there's the PowerPoints and then there's the leadership messaging, and then we drop it onto everybody. And why don't we just ask people? Ask them for their opinion. Ask them what they want. And that leads us right to our topic today because today we're going to talk about one of your favorite subjects, which is EDI. What's next for EDI? And we're going to talk about what is the industry doing to find out what people in the industry actually want. And, of course, we bring back to the mic the recognized expert in EDI. He chairs the business to business committee for AIAG, the one and only Fred Coe. Fred, welcome to the show.

[00:02:30] Fred Coe: Yeah. Well, thank you both for having me back. I'm excited to be here.

[00:02:34] Terry Onica: We love having you. And I wanted to mention to our audience that Fred is the most top-viewed podcast that we've had on Auto Supply Chain Prophets. So, people want to hear what he has to say. So, we're so excited to have you back again, Fred. And congratulations, you're still number one.

[00:02:52] Fred Coe: I appreciate that. I know it's about the EDI and nothing to do with the looks or the head here on the screen. So, I appreciate that.

[00:02:58] Jan Griffiths: I don't know, Fred. I think it's both, my friend. I think people are genuinely interested in EDI, but it is your passion and leadership for the subject, that's what resonates with people.

[00:03:10] Fred Coe: I will tell you, I have a blast with EDI, whether it's learning about new messages or new technologies. I've seen my career shifting from, you know, at first, learning and not really liking EDI when I first started. Now, I think about it all the time. I enjoy passing those lessons that have been given to me by my mentors on to the next generation.

[00:03:32] Terry Onica: It's so funny that you say that. Back in 1989, oh my god, that sounds so long ago; it's when I started my career in EDI at Ford. I remember going into a role it's just being on a team, and within a month, I was the team leader, and I really knew nothing about EDI at all. And I always tell Jan I should get the credit for EDI being a mandate with suppliers, whether you like it or not. I remember them asking, "Why aren't we getting more people on EDI?" And I said, "Because they're not motivated. It's not a priority to them." So, they changed it right away, but I worked with a great team of leadership there and learned EDI. So, it's always been near and dear to my heart, and I credit it for all my career because, Fred, you know when an EDI doesn't work, you begin to uncover all the issues that can cost us a plan. It's like an IV into the plan. I can't say that enough. But I think that's why this topic, well, I shouldn't say I think, I know that's why this topic is so watched in the industry because there is such a huge investment in it. So, we're really excited to have you on the show today. But one of the things we want to talk to you about is the committee is going to be doing an EDI survey. And it's going to have some things to do about APIs. Can you tell us a little bit about it?

[00:04:48] Fred Coe: Oh, yeah, absolutely. So, we've been talking here for a better part of the year about what role, if any, could APIs play in helping to augment our existing EDI processes. And they're so prevalent in every industry now, every time you get onto the Internet and you look up the weather, when you go to the doctor's office and you pull patient records, APIs are virtually everywhere now. And as we've talked internally to the group, we get really excited about it and say there's a lot of potential here, but we're not under the "Build it and they will come" model. And so, what we're looking to do is we've crafted a survey that we want to take out to the automotive industry, and get as many responses as we can and find out from the industry, where are they at? We know the investment that they have in EDI today. It's in the hundreds of millions, at least within the automotive industry, between all the infrastructure, the maps, and the labor into it. And so, really, what we're looking for here is how do those APIs fit into that landscape and into our future.

[00:05:56] Terry Onica: Hey, Fred, can you tell people that are listening that may not be familiar with APIs, can you tell them what APIs are and what they mean with regards to EDI?

[00:06:05] Fred Coe: Yeah, absolutely. So, an API stands for an Application Programming Interface, and it's very similar to EDI. When we use the terms EDI and API, it's exchanging data in a structured format from the machine to machine. And like EDI, whether you're using AS2 or FTPS or SFTP, you can pull data, you can push data with APIs. It's primarily in the backend. It's based on JSON or XML, but it is direct from application to application, and you're talking seconds in terms of response time, as opposed to minutes with the EDI. And so, that API really provides some distinct advantages with some functions that are currently be done with EDI to help augment that process and getting data. And APIs are definitely not as mature as EDI is; they started around the late 1990s with, I believe it was with Salesforce when they were bringing out their first SaaS solution, but they've matured, and they really have taken off in every industry.

[00:07:15] Terry Onica: So, why APIs? Why not something else? What's the benefit that APIs bring over other technologies?

[00:07:22] Fred Coe: Yeah, we're certainly not opposed to other technologies, right? We've looked at things like XML in the past as a potential means of, and at the time, it was replacing EDI, right? We said XML is going to take over as a standard for EDIFACT or X12, and we saw that that really didn't materialize, but with APIs and the prevalence in the market today, I think it's just irresponsible not to look at it to say, "How can we start to at least evaluate and potentially adopt some of these?" And if we do find with the survey that there's interest in the market, and AIAG is in a unique position, Terry, and you alluded to it earlier, right? That's to help standardize how we implement those APIs. What we don't want to see is if these APIs hold promise, is that all of the different OEMs or the tier ones to develop their own standards, right? And then we're going to be back where we were in the eighties and with everybody doing their own thing and then having to corral all of that into a standard later. So, we want to get ahead of it and help develop those standards if there's interest.

[00:08:27] Jan Griffiths: Okay. I got to say one thing. Thank you. Thank you. Thank you. As a recovering supply chain leader in the tier one space, having to deal with all the different requirements from the different OEMs and then somebody in a leadership meeting will go, "Oh yeah, we'll just, you know, just make sure that gets down to the supply base." Uh-huh. Do you know how hard that is? It's really bloody hard. So, this idea of standardization is not just nice to have; it's going to save time. It's going to be more efficient. Imagine that as you translate these requirements all through the tiers. When you start to have different OEMs with different requirements, it's an absolute nightmare to manage. We want a seamless flow of data, quick and accurate. That's what we want. And if this does this, Fred, absolutely, I am all in to do whatever we need to do to get the message out. And to my point earlier, everybody has a voice in this now. So, take advantage of this opportunity now to get your voice heard. Don't complain about it later when you don't like the standard because this is an opportunity to get your voice in this survey right now. Is that right, Fred?

[00:09:44] Fred Coe: We want to hear from everybody. I want to hear from the people that say, "I want to do it all with APIs," and I want to hear from our diehard community that says, "Nope, EDI works fine now; we don't need to change it. But maybe this needs to be tweaked, or that needs to be tweaked." But we want to hear all opinions and all voices so that we can make a decision that is with the most consensus that we can get from the industry.

[00:10:09] Terry Onica: It's critical when you think of all the connections between all the OEMs and their tier-one suppliers; there's got to be tens of thousands. And then, the tier ones do it with the tier twos and there's got to be lots of connections there. We have to do this right. And I know both Fred and I are big advocates. We got to get in front of this before things start to happen and see what the industry wants to do. And it's just great that we're able to do this through AIAG or the Automotive Industry Action Group for listeners out there that may have not heard that acronym before, but it's critical, and it's so costly to the industry, right?

We've got lots that we would have to replace and figure out how it would be replaced. So, this survey—we can't stress enough how critical it is. Fred, I have a question, though, for you: When we look at APIs, are there other industries that are having success with them, and what benefits are they seeing? Or are people even in the auto industry using them? Could you tell us about that?

[00:11:11] Fred Coe: Sure. So, we met earlier this year with Odette and VDA, and they have actually started the process of standardizing APIs for logistics in Europe. And a couple of the big OEMs have side-on for that and they're starting to see some success with adoption there. Outside of automotive, most of the other industries have already started adopting and standardizing. The healthcare industry uses it extensively. Retail is starting to use it. So, if you look at the Amazons and the Walmart’s, they have not replaced EDI with APIs, but what they've done is they've stood them both up. And when you come on as a supplier, you can use either, right? You can use traditional EDI or you can use APIs. In my role outside of AIAG, what I've seen is a number of suppliers that have approached my team and said, "Can we use APIs instead?" Right? For various functions. And we don't have that right now, but we're starting to see signals of demand, and we're definitely seeing more adoption in the other industries outside of automotive. And really starting to get a toehold in the industry in Europe.

[00:12:20] Jan Griffiths: Fred, perhaps you can clarify something for me. Is this actually replace the current EDI or is it an enhancement to it? How does that work?

[00:12:29] Fred Coe: It could be both. So, there is an opportunity for some messages where this could replace current EDI messages. So, we mentioned Odette and VDA using those APIs and logistics. That actually eliminates the need for some of the status messaging that goes back and forth between OEMs and the logistics providers. And that's machine to machine, true machine to machine, right? From an OEM application to the logistics application. Now, that doesn't mean that you couldn't have an API in a traditional VAN, right? So, you could have a VAN that offers APIs for the various trading partners that they support.

But, in terms of replacing EDI, I don't see it replacing that infrastructure, at least in my lifetime. But I do see APIs providing potentially another parallel path for it, or complementing some messages and maybe some processes outside of that. Maybe that API would feed into an EDI message, such as an ASN. If a supplier needs to go pull a tracking number from a carrier, for instance, you know, that would be another potential use for APIs. But the traditional VANs, the structured messages that we have today, are very complicated, and to think that we're going to replace all of that complexity with an API off the bat is just not realistic.

[00:13:56] Jan Griffiths: Thank you.

[00:13:57] Terry Onica: Can you give us a little sneak peek of what types of questions are going to be on the survey?

[00:14:02] Jan Griffiths: Yeah, absolutely. So, the objective of the survey is a few things. Number one, we want to know more about what EDI model they're using today. Are they using an in-source model? Are they using a software as a service or a hybrid? Are they using web forms? Are they using APIs? So that we can get a level set of the respondents that are coming in. And then, what we want to find out is what experience, if any, they have with APIs today. Right? We want to know if they're using them have they had success with them? Or what's the function that they've augmented with APIs, and what's their result? And then their interest in going forward with APIs. Do they have interests? Would they like to see APIs become more prevalent or be offered? And if yes, in what regard? And then there's also a couple of open-ended questions with the survey where we can have them come back and just give them their verbatims, right? What is it that they want to describe as being a need for them or a challenge for them?

[00:15:05] Terry Onica: It's always great to have an outlet for you to be able to share your thoughts in this, especially in the auto industry. People have a lot of different thoughts on the topic. So, if you get a copy of this survey or get a request for to fill out the survey, who would you recommend that fills it out? I know AIAG is going to do a mailing on it, but it might go to the wrong person. Who would be the right person to forward it to?

[00:15:30] Fred Coe: So, we want anybody that has that IT background that is familiar with their EDI, familiar with their IT infrastructure. So, whether it's a CIO, IT staff, EDI staff, if there's people on supply chain or customer service that have some familiarity with EDI and APIs, that technology, we definitely want to hear back from them, right? We want to hear back from the person that says, "Hey, my stuff isn't broken. You won't break it, right?" We want to hear back from as many people as possible. So, what I would say is, if somebody gets that survey link, if you're so inclined, please fill it out, but share it with others in the industry. Your network that will do the same. We want to hear as many voices on this as we can so that we build something that is meaningful, if that's where the survey results take us. Build something meaningful that people have buy-in so that they want to see it succeed.

[00:16:27] Terry Onica: That's good that the industry is getting ahead of this and in your leadership on the committee. How many questions are there going to be? And how long will it take folks to fill it out?

[00:16:37] Fred Coe: It's relatively short. It'll be 10 to 15 minutes to fill it out. There are 18 questions, with two questions that are open-ended. And there's also going to be an option. If you want AIAG to contact you about your answers, there'll be an opportunity for you to put that information in and to indicate that you do want to be contacted with your contact information so that we can follow up and maybe get some more insights that weren't provided in the survey.

[00:17:03] Terry Onica: And I would also say, too, for folks to make a comment, if you're interested in being a part of the committee, because AIAG is always looking for people, and I'm sure as we go through this, we're going to want a lot of voices. So, if you're really passionate about it, you probably want to make sure you put in the comments that you'd like to be contacted to be a part of the committee, right, Fred?

[00:17:23] Fred Coe: Yes, the more the merrier here, right?

[00:17:26] Terry Onica: Absolutely.

[00:17:26] Fred Coe: Yeah, we can use all the hands that we can get.

[00:17:28] Jan Griffiths: Yeah, get your voice heard. Get your voice out there now. This is an opportunity to shape the future of EDI. What a great opportunity.

[00:17:38] Fred Coe: I think what one of the other aspects of this is that we're asking the respondents to look at what areas as well that those APIs could be used in. And so, it's getting that feedback, having them volunteer, and helping them be part of the solution that gets built.

[00:17:54] Jan Griffiths: What's the timing, Fred? When will this be available?

[00:17:57] Fred Coe: We're looking at a mid-November launch of the survey. So, there'll be a link, it'll be hosted with AIAG. And we expect that it'll be communicated not only through the AIAG emails, but some of the OEMs have also offered to put this out through their bulletin and communication processes as well. My personal take on this is that we can share it on LinkedIn. We can share it through our networks. I really encourage people to be on the lookout. And if they don't see it, let us know, and we'll make sure that they get it.

[00:18:26] Terry Onica: And there's a couple of other ways, too. I know at QAD, we're a member of the committee, and we're going to share it too out to our community. And then also on Auto Supply Chain Prophets, always check back on this episode, and when the link becomes available, we'll make sure that we post the link there so that you're able to fill out the survey. Like Fred said, we want to get as many people as possible to fill out this survey because it's really critical on where we go and what people's experiences are, or maybe even lack of experiences, because it might mean that if we decide to go this way, there'd be some training that might be needed in the industry as well, too.

So, those are several different ways that you can reach out to get the survey or always contact AIAG, as well, too. They can get you a copy of the survey as well, I'm sure it'll be in their newsletters and bulletins. But, by all means, start watching for it for the middle of November, and we're really looking forward to hearing what people have to say and where people want to go.

[00:19:24] Jan Griffiths: Yeah. When will the results be out, Fred?

[00:19:27] Fred Coe: They'll be out in Q1 of next year. So, once we get the results in, we're going to keep the survey open for two weeks, and depending on how many results we have by then, we may extend it a little bit longer, but then we're going to take a little while to analyze the results and then put those results out for the industry to see.

[00:19:43] Terry Onica: And I'm sure AIAG will probably also, again, put it in their newsletter. I'm sure it'll be out on their website, the results for it as well, too. And again, when that link becomes available, I'll go back and post it on Auto Supply Chain Prophets so that, for any reason, you didn't get a chance to see it; it'll be here as well, too. But, yeah, it'll be really exciting to see the results and tell the results of what people are seeing and where they want to go with EDI.

[00:20:10] Jan Griffiths: Fred, your piece of advice to all the supply chain leaders out there as we look toward the future of EDI, what would that be?

[00:20:19] Fred Coe: I would say get to know your supply chain, not just your tier ones, but your tier twos to your tier ends. The more you know about your supply chain, the more that you can predict success as you go forward.

[00:20:31] Jan Griffiths: Yeah.

[00:20:31] Terry Onica: Hey, Jan, I have one piece of advice, and it's four words: fill out the survey.

[00:20:37] Jan Griffiths: Well, yeah, I was going to say, get engaged, right? Get your voice heard. Don't start complaining about it later if you don't like it. This is an opportunity. A lot of work is involved in putting a survey like this together, but this is your opportunity to get your voice heard and that's the supply chain, IT, anybody who's touching EDI.

[00:20:57] Terry Onica: And one other thing, Fred and I are both on LinkedIn, so connect to us on LinkedIn if you need to. So, lots of ways to reach out to us, but we're really excited about this and the survey results. And Fred, thank you for your leadership and for bringing this to the industry.

[00:21:11] Fred Coe: Thank you. I can't thank you both enough for having me on today so that we can get the word out.

[00:21:15] Jan Griffiths: Yep. We're all about that. Fred, thank you so much.

[00:21:18] Terry Onica: Thanks, Fred.

[00:21:19] Fred Coe: Thank you.

[00:21:24] Jan Griffiths: Are you ready to find the money in your supply chain? Visit www.autosupplychainprophets.com to learn how or click the link in the show notes below.