edi adoption in saudi arabia-ncc16

8/3/2019 EDI Adoption in Saudi Arabia-Ncc16

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8-2-01 EDI adoption in SA 1

Electronic Data InterchangeElectronic Data Interchange

Adoption in Saudi Arabia Adoption in Saudi Arabia

Dr. Mohammed A. T. Al-SudairyAssistant Professor

Business DepartmentFaculty of Economics & Administration

King Abdul Aziz University, JeddahE-mail [email protected]



6/2/01 EDI adoption in SA 2

Presentation LayoutPresentation Layout

Introduction

EC and EDIMethodology

Findings

Conclusion




Inter-Organization SystemsInter-Organization Systems

Electronic Data Interchange (EDI)

Electronic Commerce (EC)

Electronic Fund Transaction (EFT)

Electronic Mail (E-mail)

Electronic Form (EF)Integrated Massaging and

Shared Database




Electronic CommerceElectronic Commerce

EC is the handling of business transaction

over communication networks.

EC is not enabling technology but it is

simply conducting business electronically

through enabling technology such as EDI,

VANs and Internet.




Electronic CommerceElectronic Commerce

CategoriesCategories

Business to Business (B2B)

Business to Consumer (B2C)

Business to Government (B2G)

Government to Consumer (G2C)Consumer to Consumer (C2C)




Electronic Data InterchangeElectronic Data Interchange

EDI is the electronic transmission of business data between or within firms in

structured, computer processable dataformat, which permits information to betransferred without re-key from

computer application in one location tocomputer application in the other location.




EDI Standards

Communication Standards

EDI Software

EDI Networks

EDI ComponentsEDI Components




Translator Translator

Application Application

Communication

Software

Communication

SoftwareVAN

Sender Receiver

EDI Network




Quantity Unit No. Description Price

1 CSE 6900 CELLULOSE SPONGES 12.75

12 EA P450 PLASTIC PAILS .457

4 EA 1640Y YELLOW DISH DRAINER .95

1 DZ 1507 6” PLASTIC FLOWER POTS 3.00

From:

To:ANSI X12 FORMAT

IT1*1*1*CSE*12.75**VC*6900

IT1*2*12*EA*.457**VC*P450

IT1*3*4*EA*.95**VC*1640Y

IT1*4*1*DZ*3**VC*1507

Translating from a “ Human Readable” to a

“Machine Readable Standard Format

Application systems

e.g. accounts system

EDI

Translator

ANSIX12

Invoice



8-2-01 EDI adoption in SA

Communications

Interface

EDI

Translator

Application

InterfaceApplication

System

Application

System

ApplicationSystem

EDI Interface



8-2-01 EDI adoption in SA

Communications

Interface

EDI

Translator Application

InterfaceApplication

System

Application

System

ApplicationSystem

EDI Interface




EDI BenefitsEDI BenefitsReduced overhead costs

Reduction in labour

Increased accuracyImproved communications and

management control

Improved inventory control

Enabled retailers to be more responsive toconsumer needs




Motivation FactorsMotivation Factors

Operational

Quick response &

access to informationIncrease data accuracy

Strategic

Better communication

with trading partner Remaining competitive

Butter customer service

Reducing stock




EDI BarriersEDI Barriers

Difficulty of a cost/benefit evaluation

The need to keep in use two information

systemsStandardisation

Externalities of EDI applications can

overstep the firm’s boundaries and modifythe business and market perspective fromcompetition to collaboration.

Resistance to change.




The Ned for EDI in SAThe Ned for EDI in SA

To participate in international free

trade

To liberalise trade and economic

To become a member of WTO




Factors influencing theFactors influencing the

Decision to use EDIDecision to use EDIOrganization size

External Pressure

– Competitors

– Local customers or suppliers

– Overseas customers or suppliers




Methodology & SampleMethodology & Sample

An Exploratory Study – Survey

Questionnaire

The Sample – 297

– 40

Response – 126 (37%)34 use EDI92 None user




Business Type

0

5

10

15

20

D i s t r i b u t e r

A p p l i a

n c e

S u p

/m r k C a r

D a i r y

D e p

/s t o r e

F u r n

i t u r

P h a r m a c i s t s

S t a t i o n

e r y

S u p e s t o r e

F

o o d

C o s m e

t i c s

T

o y s

C o t h

i n g

O t h e r s




Finding / PressureFinding / Pressure

Local Suppliers – 7

Local Customers

– 7

Overseas Suppliers – 26

Overseas Customers – 5




Hypotheses ResultsHypotheses Results

Variables Chi-Q SigOrganization size 2.27 0.32

Competitors use EDI 7.26 0.02**

Pressure local sup 3.25 0.07

Pressure overseas sup 12.3 0.00***

Pressure local custm. 20.88 0.00***

Pressure overseas custm. 3.00 0.08




EDI Barriers in SAEDI Barriers in SA

The lack of MIS staff

An inadequate training program

An unsatisfactory communication lines

Poor awareness about EDI

Standardized business operating procedure




IT BarriersIT Barriers

Lack of technical expertise either by – Service providers or

– Organizations the users

Shortage of technical skilled employee

Lack of technical support by ITsuppliers

Lack of Knowledge about IT




ClosingClosing

Government – Education

– Promoting

– Employment – Leading

Private –

Need to be computerized – Treat IT as a competitive weapon

– Joint venture and strategic alliances

edi adoption in saudi arabia-ncc16

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