This blog covers the below mentioned options and it will help us to understand clearly about EDI.
What is EDI & Why does business use it?
- SAP XI/PI and EDI
- What are EDI Standards
- The Flow of Electronic Documents
EDI Definition:
Electronic Data Interchange (EDI) is the exchange of business data from the computer of one enterprise to the computer of another enterprise using a standard format like PO, Invoices e.t.c. I.e Intercompany Electronic Exchange of Business Documents in a Standard Format.
EDI is used with trading partners who are EDI capable and use EDI as a technology to improve the efficiency of their business. Not all trading partners are EDI capable or choose EDI as their technology of choice.
Why does Business use it?
- Increased business opportunities
- Reduced inventory
- Lower data entry costs
- More accurate records
- Decreased mailing costs
- Reduction in order time
- Better cash management
Examples:
Paper Document - average cost is $50
EDI Document - average cost is $4
What are EDI Standards:
Allows electronic interchange of data between many business partners without the re-development of new a proprietary interface with every partner
Provides a comprehensive, generic description of all possible components of a (paper) business document
ANSI X12 :
- American National Standards Institute (ANSI)
- Cross-industry general business standard
- Used throughout North America & Canada
- X12 Versions 003020 and 004010 is preferred when trading EDI with Suppliers
- Can accommodate any customer version
EDIFACT :
- EDI For Administration, Commerce, and Transportation (EDIFACT)
- Used throughout Europe and Asia, and by some international companies in North America
- EDIFACT version D97A is preferred when trading EDI with suppliers
- Can accommodate any customer version
TRADACOM :
- Trading Data Communications (TRADACOM)
- Tradacoms is an early standard for EDI primarily used in the UK retail sector and one of the precursors of EDIFACT
- Tradacoms versions are V8 and V9
- Can accommodate any customer version
SWIFT :
- The Society of Worldwide Interbank Financial Telecommunication (SWIFT)
- operates a worldwide financial messaging network which exchanges messages between banks and financial institutions
- SWIFT linked 8740 financial institutions across 209 countries
- A list of Document standards are
- Customer Payments & Checks
- Treasury Markets–Foreign Exchange, Money Markets & Derivatives
- Documentary Credits & Guranatees
- Cash Management & Customer Status
RosettaNet:
- RosettaNet is an organization set up by leading information technology companies to define and implement a common set of standards for e-business.
- A Partner Interface Process (PIP) is a message model that depicts the activities, decisions and partner Role Interactions that fulfill a business transaction between two partners in a given supply chain.
- RosettaNet consists of a consortium of major computer, consumer electronics, semi-conductor manufacturers, telecommunications and logistics companies.
- The RosettaNet document standard is based on XML and defines message guidelines, business processes interface and implementation frameworks for interactions between companies.
EIDX:
- The Electronincs Industry Data eXchange association
- Most major electronics companies in North America are members
- Education, Develop Business Models and Guidelines on how best to implement the ANSI X12 and EDIFACT standards and more recently XML within the RosettaNet standards
COMPTIA:
- Computing Technology Industry Association
- A global organization which represents 7,500 computer hardware and software manufacturers
- EIDX & COMPTIA now host joint meetings for mutual benefits
Counterparts to EIDX :
EDIFICE (European) - EDI For Companies Interested in Computing and Electronics
EDIMAN (Singapore) - EDI for MANufacturing
EIAJ (Japan) - Electronics Industry Association Japan standards and more recently XML within the RosettaNet standards
Reference Links: