EDI Electronic Data Interchange

EDI Electronic Data Interchange is a commerce correspondence arrangement which exchanges common business forms and documents such as purchase orders, invoices, shipping documents, etc., with a machine based communications and archiving solution.

An alternative EDI Electronic Data Interchange description is: “EDI electronic data interchange is the inter-business, machine-to-machine exchange of trade documentation in a standard format that can be processed by a computer.”

There are a few central considerations which makes EDI electronic data interchange at odds with other types of paper or electronic communications. EDI electronic data interchange happens between organizations. The growth in the use of computers has been unbelievably large during the past several decades and a similar development is happening between enterprises.

EDI electronic data interchange is communication between machines. EDI electronic data interchange was not created to completely remove paper, but rather to decrease the manual input, errors and time consumption that paper requires in business to business transactions. More than 70 percent of one computer’s transactional data output becomes a second computer’s transactional data input. In a paper environment, in comparison to EDI electronic data interchange, the result is that the same data is being keyed and re-keyed, in different processes, into both computers. With EDI electronic data interchange, the machines are integrated so that duplicate data entry doesn’t happen.

EDI electronic data interchange was created to enhance the management and flow of transactional data. Any data that is on a business form is applicable for EDI electronic data interchange. EDI electronic data interchange is utilized for the most customary trade transactions such as bills of lading, status reports, purchase orders, invoices, quotes, receiving advices; and in addition for very specialized transactions like residential mortgage insurance applications, healthcare claim payments, and material safety data sheets.

Since EDI electronic data interchange is machine-to-machine information exchange, rather than interpersonal, the information communicated in EDI electronic data interchange is comprehensible to a computer. This means the EDI electronic data interchange information must exist in a pre-confirmed and structured format, thus allowing the information to be accessed and comprehended by the machine without a person to translate.

Above we mentioned that the purpose of EDI electronic data interchange is to enhance data management. EDI electronic data interchange attains improved information management through minimizing non-value added time and removing redundant data entry. The basic functioning of EDI electronic data interchange, in comparison with a paper-based solution is described below.

In a rudimentary EDI electronic data interchange transaction the buyer’s computerized purchasing system creates an order on a paper form. The paper PO is delivered through a manual system to the supplier. When the PO is received by the supplier, an order entry clerk reads information from the PO and enters it into an accounting or ERP system. With EDI electronic data interchange, the information is transmitted directly from the purchaser’s computer to the supplier’s computer, without communication or processing delays. In EDI electronic data interchange, the conversion to a paper format, the reading and interpretation of that paper document by an order entry clerk, and the re-entering of the information are unnecessary steps.

As Electronic Data Interchange has proliferated in the enterprise world, it has begun to impact small and mid-sized businesses.  Larger retailers are now mandating Electronic Data Interchange more frequently for their vendors.  As a result, many small businesses are now searching for the Electronic Data Interchange solution that is right for them, now and in the future.  Understanding Electronic Data Interchange and selecting the best way to satisfy the mandate for Electronic Data Interchange usage can be a lengthy and difficult process.  A good Electronic Data Interchange software solution should be easy to install and easy to use. In addition,  the Electronic Data Interchange software should provide an easy means to add support for as many trading partners as possible. The Electronic Data Interchange software should allow for a high level of automation – so that the business can focus on its core competency rather than on satisfying Electronic Data Interchange mandates.

One of the most challenging aspects of deploying Electronic Data Interchange software can be the installation process. Many Electronic Data Interchange solutions require dedicated, expensive hardware to process Electronic Data Interchange at maximum efficiency.  EMANIO’s Electronic Data Interchange software solution, on the other hand, can be installed on the simplest of computers and our Electronic Data Interchange software can be deployed in as little as five minutes.  Electronic Data Interchange software from EMANIO focuses on automation.  Our goal is to provide Electronic Data Interchange software that will allow the business owner or the IT manager to automate as much of the Electronic Data Interchange process as possible.

Another key aspect of Electronic Data Interchange software is expandability.  Specifically, how quickly and easily can the Electronic Data Interchange software be modified to incorporate new trading partners into the Electronic Data Interchange as your business grows?  EMANIO’s Electronic Data Interchange software is very easy to install, easy to use, and can add support for new trading partners in as little as a few minutes.  As your use of Electronic Data Interchange grows, EMANIO’s Electronic Data Interchange software will grow with you at affordable rates and with a reliable solution. 

Regardless of which Electronic Data Interchange software you eventually select, as a small business owner, you should take the time to investigate some of the specifics of Electronic Data Interchange.  You should find out which of your trading partners use Electronic Data Interchange, in order to maximize your investment in Electronic Data Interchange Software.