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Calling for the best: NT and EDI.

With revenues of $8.2 billion U.S. annually, Northern Telecom Ltd. (NT) is the leading global supplier of fully digital telecomm switching systems. Productions include datacomm networks, fiber optic equipment, phones, outside plant hardware, radio and microwave undersea systems.

The company has a vision for the future: to be the leader of the telecomm industry by the year 2000. This goal is known as Vision 2000, and to achieve it, the company will build on its reputation as a manufacturer and user of innovative technologies. NT sees innovative use of technology as a strategic weapon, and an important component in its arsenal for success is EDI (electronic data interchange).

NT has a tradition of commitment and involvement with EDI. For Canadian customers, EDI was originally a joint effort with Bell Canada, NT's largest Canadian customer. In 1979, the NT marketing organization lauched a mainframe proprietary form of EDI to exchange order information with Bell Canada and with New Brunswick Telephone (NB Tel). At that time, a computer-to-computer order processing link was established with all NT manufacturing divisions in Canada. In 1986, a simillar link was established in the U.S.

According to Kathy Kelly, manager of EDI projects at NT, the company soon discovered that a PC-based EDI syhstem was too dificult to manage for a company of their size. "We did a study and determined that a mainframe solution would be best," Kelly reports.

The PC-based EDI system was shifted to a mainframe, and common representatives began shopping for a mainframe EDI software product. The choice was Translator-MVS, a product developed in Canada and currently marketed by Sterling Software's oredernet Services Division. For communications, NT chose Sterling's Traces communications software.

Kelly sums up the history of NT's EDI involvement as a "happy accident." She explains, "Our customers wanted to do EDI with us, and we implemented it in response to their requests. Once EDI was in place, however, we saw the tremendous potential of EDI for our company."

The migration to the public ANSI X12 standard first occurred as a result of customer pressure. By 1989, pilot projects with NB Tel and Alberta Goverment Telephone (AGT) and NFLD Tel were implemented. By the end of 1989, NT's electronic communication with Bell Canada in both Ontario and Quebec was migrated to ANSI X12, and the proprietary relationship with NB Tel was successfully translated to X12 formats.

One year later, all Canadian telcos were either in discussion, production or testing phases of a shift to the ANSI public standard. Business Telephone Equipment (BTE) came on board with NT via X12 in 1990. By the end of 1991, all NT's customers throughout Canada and the U.S. were linked to the company electronically using X12.

Today, electronic communication with U.S. trading partners used the ANSI standard, while most of the company're remaining proprietary EDI communication is limited to a few Cnadaian trading partners, albeit large ones. NT is currently exploring the possibility of migrating all proprietary orders, product catalogues, cross references and pricing transactions to X12. Meanwhile, the X12 format is being used for purchase orders for most merchandise, and NT is investigating new documents in X12.

NT is a beehive of EDI activity. More than 150,000 proprietary job-related order transactions pass through its Canadian central order facility each month. In addition, 500,000 proprietary product catalogues, corss references and pricing transactions are sent monthly to its customers. In X12, NT Canada receives more than 3,600 perchase orders each month constituting 95% of its merchandise product line. (Documents used for NT's central office product line remain in the proprietary format.)

With its largest customer, Bell Canada, NT exchanges nearly 23,500 EDI transactions montly, representing approximately 59% of its total.

In early 1992, NT's accounts payable department received 2,000-3,000 X12 invoices per month. The EDI program with suppliers is important because it is significantly lowering data entry and error handling costs.

EDI documents in use at NT include purchase orders, PO charges, PO acknowledgements, PO change acnowledgements, invoices, product prices, payments, applications acknowledgements, planning schedules and advance ship notices. Further, the company has undertaken a pilot program with a U.S. customer to use an X12 document called the request for quote as a request for feature.

Internationally, an electronic link between NT in the U.S. and NT in Canada allows U.S. customers to send orders via EDI. Oversease, European division in France, Ireland and the U.K. transmit orders via EDIFACT, and the company is investigating what Kelly terms an "overall, long-term, strategic move to EDIFACT."

NT is upgrading its communications software from Tracs to Supertracs. kelly notes that Supertracs was chosen for its mailboxing and unattended file transfer capacity.

NT now has 150 electronic supplier and customer trading partners. On the supplier side are Motoroal, Texas Instruments and National Semiconductor. On the marketing side, all major customes are linked with the company electronically.

An aggressive program to expand EDI used and to reengineer business systems and procedures is on the horizon.

First, NT plans to annex additional EDI X12 documents, including electronic order changes, schedules and product/price infromation. They are aggressively adding supplier EDI trading partners, as well. The goal is to implement EDI with NT's top 100 suppliers. On the customer side of the business, the company is looking to bring smaller customers, such as distributor companies, on board.

Based on its universal success and Kelly's experience with EDI, she has several recommendations for others. Like many EDI managers, she says high-level support for the implementation is critical, and stresses the importance of marketing EDI to end users in functional business areas.

"It's a two-way effort," she maintains. "EDI should be presented to top management as part of an overall business strategy, but it should also be introduced to the end users in various areas as a way of streamlining and simplifying their jobs, while freeding them from some of their most mundane tasks."
COPYRIGHT 1993 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Northern Telecom Ltd., electronic data interchange
Publication:Communications News
Date:Nov 1, 1993
Words:994
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