CASE STUDY

www.edifecs.com (continued)

The Home Depot Streamlines Supplier EDI Onboarding

EDIFECS CUSTOMER CASE STUDY

Self-service EDI integration with Edifecs Ramp Management reduces supplier integration costs and dramatically increases the number of suppliers onboarded each month.

INDUSTRY

Retail

Edifecs Ramp Management delivers 60% reduction in FTEs required to onboard a supplier and 75% increase in suppliers added per month.

Customer profile

The Home Depot is the largest home improvement retailer in the world. It operates over 2,240 retail stores worldwide, has more than 300,000 employees and over 6,000 globally distributed suppliers. To improve the efficiency of managing this large operation, The Home Depot determined that all of its suppliers must support inbound and outbound electronic documents or face financial offsets (penalties). This requirement also included testing the accuracy of their Electronic Data Interchange (EDI) business documents.

Challenge: Manual Onboarding Environment

Before a supplier was allowed to send electronic documents, The Home Depot spent many hours manually testing each electronic document and resolving interchange issues with a supplier. This often involved multiple phone calls and follow-up meetings to get suppliers to adhere to electronic document submission requirements.

As part of this manual process, The Home Depot would test for basic EDI transaction compliance using their production translator and back-end systems to check for syntax and business edits. This typically spawned extensive activities to identify the causes of each transaction’s syntax error. Additional time was spent discussing the identified errors with supplier technical staff. Finally, suppliers would resubmit their corrected transactions — numerous times — until all testing errors were eliminated.

This labor-intensive process limited the number of suppliers that could be tested at a given time, which in turn, delayed suppliers’ ability to transition from paper to EDI- based transactions. Most importantly, the manual process could not scale to integrate and maintain EDI connectivity to thousands of globally distributed suppliers. The slow progress made in onboarding paper-based suppliers resulted in adverse business impacts to The Home Depot’s Finance, Merchandising, and Supply Chain groups.

Objective Reduce the cost and time required to integrate suppliers.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ApproachReplace manual integration process with a supplier self-service portal to configure and test both syntax and business edits during EDI integration.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

IT Improvements

· 75% reduction in manual steps involved in supporting the onboarding efforts.

· Elimination of all supplier manual reviews of EDI translator error logs.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Business Outcomes

· 60% reduction in FTE’s required for onboarding activity.

· 75% increase in the number of suppliers onboarded per month.

Setup Global Supplier Community

1:

Invite and Notify Suppliers

4:

Provision and Register Suppliers

2:Monitor and Report

on Supplier Onboarding

6:

Compose Onboarding Programs

& Workflow

3:Manage Testing and EDI Issues

5:

Medicaid Program Achieves $4 million Reduction in Operations and IT Costs

www.edifecs.com 2

Objectives: Streamlining Supplier EDI Onboarding

To achieve its large-scale supplier EDI onboarding objectives, The Home Depot needed a new approach that would:

· Reduce the time and cost The Home Depot staff needed to spend on each supplier’s EDI integration effort.

· Increase the number of supplier EDI implementations that can be achieved each month.

· Ensure supplier EDI implementations were accurate at both a syntax and business content validation level (e.g., testing store numbers).

In addition, The Home Depot wanted to implement a solution that would help maintain or enhance their supplier relationships by being easy to use, comprehensive and cost-effective.

Solution: Edifecs Ramp Management

The Home Depot selected Edifecs Ramp Management to streamline the onboarding of suppliers to their production systems. Edifecs Ramp Management is a Software as a Service (SaaS) offering that reduces onboarding staffing requirements, speeds onboarding of suppliers and increases supplier transaction integrity during production. As shown in the diagram, Edifecs Ramp Management enables an organization to create a branded self-service portal that allows suppliers to test their EDI documents. It also includes support tools so that suppliers can access an EDI knowledgebase and efficiently communicate with The Home Depot staff as they test their EDI implementations. Key features of the Edifecs Ramp Management that led to its selection by The Home Depot were:

· Extensive protocols: Support for testing a wide range of standards and file formats (e.g., X12, EDIFACT, XML and Flat Files, etc).

· High availability: The Web-based portal is available for supplier testing 24 hours a day, 365 days a year so suppliers are not limited to working hours.

· Scalability: Hundreds of suppliers can be onboarded each day regardless of staffing levels.

· Customization: Testing scenarios were customized to mirror The Home Depot’s production processes, such as testing for syntax and business edits, combined with comprehensive testing criteria for different trading partners using different file types.

· Visibility: Supplier participation and testing status is managed using automated alerts and dashboards to monitor onboarding progress.

· Feedback: Intuitive error reports and scorecards indicate to suppliers which documents passed, which failed, and why.

With Edifecs Ramp Management, we replaced a complex, labor intensive process for onboarding EDI-en-abled suppliers with a self-service portal that has reduced the cost to integrate suppliers and dramatically increased the number of suppliers we can onboard each month.

Charles McPherson, Sr. Manager Supplier Services

The Home Depot

Figure 1: Edifecs Ramp Management Workflow

An industry leader since 1996, Edifecs provides healthcare software solutions that improve operational performance by streamlining the exchange of information among health plans, hospitals, and other healthcare organizations, while enabling compliance with current mandates such as HIPAA, Operating Rules and ICD-10. Today, more than 250 healthcare customers use Edifecs technology to unify transactions from any information channel source and input mechanism, while automating manual business processes such as enrollment, claims and payments management. Edifecs is currently recognized as one of the 100 Fastest Growing Private Companies in the state of Washington, 100 Best Places to Work in the state of Washington, an Inc. 5000 fastest-growing private company and one of the 500 Fastest Growing Companies in North America by Deloitte. Edifecs is headquartered in Bellevue, WA. For more information, please visit http://www.edifecs.com

©2013. Edifecs Corporation. All rights Reserved. May, 2013

Business Results

Edifecs’ Ramp Management fundamentally changed the approach The Home Depot took to onboarding its suppliers. Originally, The Home Depot staff worked with each supplier on a one-on-one basis to test EDI interfaces and to resolve errors and other integration issues. Using Edifecs Ramp Management, The Home Depot gave their suppliers online tools to perform these tasks themselves while they communicate efficiently with The Home Depot staff in a structured portal environment.

The operational and financial results from the use of Edifecs’ Ramp Management were significant:

· Elimination of all supplier manual reviews of EDI translator error logs to find and fix errors.

· 75% reduction in the overall manual steps involved in supporting the onboarding efforts.

· 60% reduction in FTE’s required for onboarding activity.

· 75% increase in the number of suppliers onboarded per month.

Future

The successful use of Edifecs Ramp Management in supplier integration is just a first step. The Home Depot plans to use Ramp Management to customize business validations edits with internal business processes. Additionally, The Home Depot will continue to eliminate supplier paper transactions by adding additional X12 and EDIFACT electronic transactions.

Replacing paper-based transactions with an EDI approach provided a much more efficient process for managing our supply chain. Edifecs Ramp Management allowed us to accelerate the transition of paper-based suppliers to EDI, and has helped us to rapidly onboard new suppliers ever since. In addition, we have maintained a consistently highlevel of transaction integrity in our production environment”.

Charles McPherson

Edifecs SpecBuilder

· Creates supplier specifications

· Format includes: X12, EDIFACT, XML, and Flat File

· Create syntax and business content rules for compliance

Edifecs Ramp Management

· Hosted Web Service

· Branded to company’s requirements

· Leverage specification created by SpecBuilder

· Compliance checking for both syntax and business edits

· Fast, easy-to-read transaction error reports

· Validates X12, EDIFACT, XML, Flat Files