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What is EDI?
Electronic Data Interchange (EDI), represents the computer to computer transfer of information in a structured predetermined format between 2 or more business partners, over a secured network.
Who uses EDI?
Most major companies are capable of EDI and many are moving toward doing the majority of their typical business transactions electronically. As the benefits become more obvious and accessible, in order to keep pace with today's business world, incorporating EDI into your business structure has become nearly mandatory.
What is the difference between EDI and E-Business?
E-Business can be the electronic exchange of information in any format; EDI is done through a standardized format and is particularly useful for a large volume of repetitive documents such as bills-of-lading or purchase orders commonly exchanged between business partners.
Why do businesses use EDI?
EDI saves money by making personnel more efficient, and it improves business capabilities by speeding up throughput, streamlining inventory, and enabling the automatic processing of documents. Furthermore, data integrity improves, reconciliation's are simpler, and EDI can easily be made an integral tool of your company's customer service.
Who manages the EDI Standards?
The American National Standards Institute (ANSI) creates standards specifically for EDI called "X.12". These standards are then taken and specialized within industries, as is done by the railway industry.
How do companies communicate through EDI?
When two companies have agreed to conduct business via EDI, once they determine common standards and which documents to exchange, they are considered "Trading Partners". There are communication protocols available for PC's and mainframe systems that allow for the exchange of EDI messages with almost any trading partner.
Why can't the company just e-mail the information?
By automating the exchange of documents, EDI eliminates repetitive data-entry and common mistakes due to human error, two conditions to which e-mail is susceptible. With EDI, the information is automatically transferred between trading partners.
Does CPR have to maintain direct connections with all of its trading partners?
No. CPR interacts with trading partners via Value-Added Networks (VANs) managed by third parties. In a sense, the VANs resemble a postal service, delivering documents to the addressee on the "envelope" which accompanies every transmission.
What do I need to do EDI?
1. EDI management software: For optimum performance, the translation software should be on the same platform as your business application.
2. Mapper: Levels of mapper information or integration very greatly from translator to translator.
3. Communications software: Can be a module to the translator, a programming tool that enables you to write communications protocols, or a separate application.
4. Internet connection: Ideally, the faster your connection, the better.
5. Access to a VAN: The value-added-network acts as a gateway between your business and ours.
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