AS2 or Traditional EDI – Which is Better?

Companies of all sizes have found significant cost savings by automating high-volume or time-consuming processes—B2B commerce is no exception. Automating the exchange of business documents…

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March 21, 20135 minute read

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Companies of all sizes have found significant cost savings by automating high-volume or time-consuming processes—B2B commerce is no exception. Automating the exchange of business documents between business partners, including purchase orders and invoices, requires a secure and common method.

AS2 (Applicability Statement 2) has become one of the most popular options for accomplishing this task, but people investigating this option usually want to know how it is different from traditional EDI.

Simply stated, the key difference between traditional EDI and AS2 is that AS2 operates only over networks running the TCP/IP protocol, and  the receiving computer must be connected to the Internet at the time the document is sent.

This means that if you decide to develop an AS2 capability in-house, both you and your trading partners must use AS2, and both of you must be communicating over TCP/IP-based networks such as the Internet.

In order to highlight the differences, I have prepared some  step-by-step scenarios for Traditional EDI and AS2 for you below.

Traditional EDI Scenario

In this scenario, an EDI Network – frequently referred to as a Value Added Network (VAN) – acts as a postal service that receives EDI documents from one company and makes them available for that company’s business partners to retrieve.  Each business partner can independently decide on the communications protocol to use for the exchange of documents.

The EDI network ensures the security and reliability of the data and authenticates the credentials of the senders and receivers.  Traditional EDI Networks provide additional services such as document status tracking and reporting too.

Here is a step-by-step walkthrough of the traditional EDI process using a purchase order as the sample business document to be exchanged:

  1. Your purchasing system creates the purchase order in its proprietary format.
  2. Your EDI software translates the document from your purchasing system’s format into a standard EDI format such as ANSI 4050.
  3. Your EDI software connects to the EDI Network and transmits the file, which will then be routed to the network “mailbox” of your business partner.
  4. Your partner’s EDI system connects to the VAN, retrieves the purchase order, and translates it from the EDI format into the proprietary format of the partner’s order management system, which makes it ready for processing.

As its name implies, traditional EDI has been around for a long time so it is  very safe, secure and reliable. Now let’s look at the AS2

AS2 Scenario

AS2 is an Internet standard created by an industry community called the Internet Engineering Task Force (IETF).  AS2 leverages the ubiquitous presence of the Internet, and then adds enterprise strength security to provide business partners with a safe reliable way of exchanging documents like purchase orders and invoices directly over the Internet using the HTTP protocol.

By using public and private encryption keys, AS2 prevents data theft or hacking while verifying that the sender of that information is a trusted source. AS2 can be deployed using internal IT resources or outsourced to a number of cloud-based business specialists. AS2 requires that both the sender and the receiver use AS2 for communications and be connected to the Internet 24×7, ready to receive transactions.

Let’s review the step-by-step process for sending EDI purchase orders via AS2.   Note, both you and your partner must both be using AS2 for the exchange of documents.

Steps 1 and 2 are the same as in the traditional EDI process above.

Then, your AS2 software takes over:

  1. Your AS2 software encrypts and digitally signs the purchase order file, and then transmits it via the Internet directly to your supplier.
  2. Your supplier’s AS2 software receives the file, verifies your credentials, authenticates the source, and decrypts the file.
  3. Your supplier’s AS2 software also sends an encrypted and signed message disposition notice (MDN) back to you, the sender, acknowledging the receipt of the file.

The last step is also the same as the traditional EDI process above.

The chart below summarizes some of the differences between AS2 and Traditional EDI:

AS2 Traditional EDI
Requires both business partners to use AS2 for communications. Each partner independently selects the best communications protocol for its company.
Sending and receiving computers must be up and running and ready to receive transmissions 24×7. Sending and receiving can occur at any time, according to your own schedule.
You must provide 24×7 communications troubleshooting support for your partners. The EDI Network personnel provide 24×7-troubleshooting support for your partners.

AS2 can exchange almost any type of file, including XML, spreadsheets, or text. For peace-of-mind, security, and AS2 reliability, many companies choose to outsource their AS2 and other B2B e-commerce connectivity to a service provider like GXS. These service providers usually have stronger security and significant IT resources, so their networks are more secure, scalable, and flexible. These outsourced service providers also stay current with changes in technology or standards, so the companies that choose them can focus on their core businesses.

If this blog is of interest to you, why not find out more by downloading the AS2 White Paper.

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