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Electronic Data Interchange

Electronic Data Interchange (EDI) is the computer-to-computer exchange of business documents in a standard electronic format between business partners. By moving from a paper-based exchange of business document to one that is electronic, businesses enjoy major benefits such as reduced cost, increased processing speed, reduced errors and improved relationships with business partners.

EDI documents are processed by computers rather than humans, and requires a standardized format is used so that the computer will be able to read and understand the documents. A standard format describes what each piece of information is and in what format (e.g., integer, decimal, mmddyy). Without a standard format, each company would send documents using its company-specific format and, much as an English-speaking person probably doesn’t understand Japanese, the receiver’s computer system doesn’t understand the company-specific format of the sender’s format.

There are several EDI standards in use today, including ANSI, EDIFACT, TRADACOMS and ebXML. And, for each standard there are many different versions, e.g., ANSI 5010 or EDIFACT version D12, Release A. When two businesses decide to exchange EDI documents, they must agree on the specific EDI standard and version.
Businesses typically use an EDI translator – either as in-house software or via an EDI service provider to translate the EDI format so the data can be used by their internal applications and thus enable straight through processing of documents.

We use varying degrees of EDI integration; depending on situational needs.

Today's EDI Methodology

Using EDI provides some big benefits:

Accuracy- information is being input once and used in multiple applications
Timeliness- information can be updated in real-time
Cost Savings- a customer can be billed for product they received within minutes of receiving
Versatility- today there are more than 80 diferent EDI forms, from standard purchase orders (form 850) to remittance advices (form 820) to warehouse inventory adjustment advice (form 947). In the "information age", EDI is a powerful tool