In order for two computers to exchange files (internally or across the Internet) you will need file-handling software that follows certain communication rules (protocols). If you communicate directly, you and your partner must use the same communications protocol. Just as two speakers of different languages (for example, one who speaks only English and one who speaks only Japanese) cannot hold a conversation, two computers using different communications protocols cannot exchange data with each other.
If you communicate directly with many partners, each of which uses a different protocol, you will need software that supports each one of those protocols. This is why many companies decide to work with a B2B Network Services provider — to shield them from all of this complexity.
There are five key factors you should consider when selecting the best Internet protocol (IP) for your company:
1. Data Security
When you are dealing with documents that contain sensitive data, you must be sure that while they are being transmitted through the Internet, they are safe from anyone who may try to intercept and read them. Each IP communication protocol takes a different approach to securing information. Some protocols encrypt everything in the transmission (channel encryption) while others encrypt only the actual data (payload encryption).
Repudiation refers to the ability to confirm that a document was actually sent by the sender as indicated within the file being exchanged. This also serves as proof if a business partner denies sending you a document.
3. Message Management
When you exchange documents with business partners, you need to know if they were successfully received and decrypted. For example, a major factor in determining whether you get paid is whether your customer received the invoice. Or, if you’re trying to plan for the arrival of a shipment at your receiving dock, getting a shipment notice is crucial. Thus, confirmation of receipt for EDI documents is extremely important for businesses to operate efficiently.
4. Ease of Setup and Use
Different protocols may necessitate different levels of resources to install and monitor its operation on day-to-day basis.
Many software vendors offer versions of each particular protocol. However, versions of the same protocol provided by two different vendors may not be able to communicate with each other. So, when you and your partners select a protocol, you must be sure of interoperability.
Whether you are a supplier being asked to communicate with your customers or you are a customer initiating programs with your suppliers, you should consider these factors when making your protocol decisions. If you’d like to learn more, you may be interested in this webinar, How to Determine the Best Communications Protocol for B2B Integration.