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EDI is the exchange of business documents in a standard electronic format between business partners through a computer-to-computer format. It is a substitute for postal mail, fax and email. Documents exchanged through EDI include; purchase orders, invoices and advance ship notices, customs documents, inventory documents, shipping status documents and payment documents. The maritime sector and its operations take over 90 percent of world trade, although several challenges have hampered its smooth operations. However, with EDI technology in import and export activities, port operations can go smoothly and in a more secure way. Utilization of electronic data interchange (EDI) helps in cutting freight waiting times, reduces error through the generation of information automatically, decreases ship stopover times, integrates the entire intermodal operation. EDI has been embraced in most developed countries of the world, although it is quite sad that developing countries such as Nigeria have not attained such height. The challenges against the utilization of EDI in port operations in Nigeria include; 1) Poor Network: For the utilization of electronic data interchange (EDI) technology to work, it requires a good network, which is presently not available in Nigeria. The poor network signal in the country has hampered the adoption of this veritable technology. Nigeria has for several years grappled with unfavourable network signal which is at the core of the utilization of this technology. 2) High Cost of EDI: EDI technology is cost-intensive, requiring substantial upfront investment. The high cost of purchase and maintenance of the technology has hindered its adoption in the country. 3) Corruption and Ineptitude: The high rate of illegalities, extortion and corruption that exist in the maritime sector in Nigeria has adversely affected the adoption of this technology due to the fact that with EDI, there is zero human or paper involvement making it difficult for illegalities and other corrupt practices to exist. 4) Lack of Technical Know-How: There are only a few in the maritime industry who know how to operate the EDI technology and this has affected its adoption in the Nigerian Maritime Industry. 5) Paucity of Investors: EDI is capital-intensive and requires investors to partner with the government to aid its full utilization in the country. Presently, due to the paucity of investors in that regard, it has hampered the adoption of the technology in the country.
Solutions
1) Improve Network: Network should be enhanced in the country to aid the full adoption of EDI in port operations. 2) Training and Retraining: The government should partner with individuals and stakeholders to train and retrain personnel in the utilization of EDI technology. There are only a few in the industry who have the technical knowledge about this, one of which is Royal Renacido. So, it is important that more people are trained and retrained in this regard. 3) Adequate Funding: Sufficient funding is required to adopt the EDI technology. Finance is requisite in purchasing, utilizing and maintaining EDI. 4) Favourable Laws: The maritime laws in Nigeria should be favourable to attract investors to invest in the sector as by so doing, it revamps the sector and places Nigeria on a high pedestal. 5) Encourage Investors: The government should encourage more investors to venture into the maritime sector as it is a profitable industry. Therefore, the government should invent policies that will lure investors as by so doing, the sector becomes improved and notable.The Application Of Edi And How It Has Aided The Maritime Sector
EDI in the world of shipping has assuaged the travails of port operations, making it seamless and undetectable. EDI is a protocol that makes it possible for two systems to connect with one another to exchange data, electronically. With EDI, it’s now streamlined. EDI operates in four formats namely: 1) Computer-to-Computer: EDI documents are flown straight to the appropriate application on the receiver’s computer such as the Order Management System, with immediate processing. 2) Business Documents: Business documents exchanged through EDI include invoices, purchase orders, shipping status documents, inventory documents, and advance ship notices. 3) Standard Format: Since EDI documents are processed through computers, a standard format should be utilized in order to enable one to read and understand the documents. 4) Business Partners: This is the process of exchanging information between two different companies.Benefits Of EDI In Port Operations
1) Eliminates error: EDI eliminates error by generating information directly. With EDI, manual processes of sending information, paying taxes and duties are removed, as they are done online, thereby eliminating human errors. 2) Removes freight waiting times: With EDI, importers and exporters do not need to spend time waiting for their goods to leave or arrive as they can track these themselves from wherever in the world they are domicile. 3) Decreases ship stopover times: Ship stopovers are reduced to the barest minimum with the utilization of EDI technology. 4) Saves Cost: It saves cost by reducing operating expenditure by reducing the cost of paper, printing, reproduction, storage, filing, postage, and document retrieval. 5) Increases business speed: EDI speeds up business cycles through process automation that eliminates time delays associated with manual processing. 6) Increases accuracy and efficiency: EDI eliminates manual processes which are clouded with errors stemming from illegible handwriting, keying and re-keying errors, and incorrect document handling. With EDI, these errors are ruled out. 7) Enhances Transaction Security: EDI increases the security of transactions by securely sharing data across a wide variety of communications protocols and security standards. 8) Reduces Waste and Creates a Cleaner Environment: Paper waste is reduced or even totally eliminated through EDI. EDI encourages a paperless and cleaner environment. 9) Integrates Intermodal Operations: EDI integrates the entire intermodal operation of sea-port-land in a single communication flow. 10) Eliminates Corrupt Practices: Corrupt practices such as illegal payments, extortion are eliminated with EDI as neither human nor paper is involved. Featured Image Source: Businessday NGGot a suggestion? Contact us: editor@connectnigeria.com