Electronic Data Interchange |
Electronic Data Interchange (EDI) is the computer-to-computer exchange of business data in a
publicly published and globally standardised format. EDI is the transfer of structured business data, by agreed message
standards, from one computer application to another by electronic means and with a minimum of human intervention.
Despite being relatively unheralded, in this era of technologies such as XML Services, the
Internet and the World Wide
Web, EDI is still the engine behind 95% of all electronic
commerce transactions in the world.
The EDI standards were designed from the beginning to be independent of lower-level technologies and can be transmitted using
Internet protocols as well as private networks. It is important to differentiate between the EDI documents and the methods for
transmitting them. While comparing the bisynchronous
2400 bit/s modems, cleo devices
and value added
networks to the Internet some people predicted erroneously that EDI would be replaced. These older transmission methods are
being replaced by Internet Protocols such as FTP, telnet and
email, but the EDI documents themselves remain.
EDI documents contain the same data that would normally be found in a paper document used for the same business function. For
example an EDI 940 ship-from-warehouse
order is used by a manufacturer to tell a warehouse to ship product to a retailer. It typically has a ship to address, bill to
address, a list of product numbers (usually a UPC code) and quantities. It may have other information if the parties agree to include it.
There are three major sets of EDI standards. The UN/EDIFACT is popular in
Europe and Asia. ANSI ASC X.12 and Uniform Communication Standard
(UCS) are popular in North America
and are very similar to each other.
These standards prescribe the formats, character sets, and data elements used in the exchange of documents/forms, such as
purchase orders (called ORDERS in UN/EDIFACT and TS850 in X12) and invoices.
The standard says which pieces of information are mandatory for a particular document, which pieces are optional and give the
rules for the structure of the document. The standards are like building codes. Just as two kitchens can be built "to code" but look completely different, two EDI documents can follow the same
standard and contain different sets of information. For example a food company may indicate a particular product expiration date
while a clothing manufacturer would choose to send color and size information.
Organizations that send or receive documents from each other are referred to as "trading partners" in EDI terminology. The
trading partners agree on the specific information to be transmitted and how it should be used. This is done in human readable
specifications (also called specs or spec sheets). While the standards are analogous to building codes the specifications are
analogous to blue prints. (The specification may also be called a mapping but the term mapping is typically reserved for specific
machine readable instuctions given to the translation software.) Larger companies have existing specification sheets and are
usually unwilling to negotiate. Often in a large company these sheets will be written to be used by different branches or
divisions and therefore will contain information not needed for a particular exchange. (Deviations from and clarification to the
specification sheets should always be obtained in writing.)
Often missing from the specifications are real world descriptions of how the data should be interpreted. This is particularly
important when specifying quantity. For example, suppose candy is packaged in a large box that contains 5 display boxes and each
display box contains 24 boxes of candy packaged for the consumer. If an EDI 940 document says to ship 10 boxes of candy it may
not be clear whether to ship 10 consumer packaged boxes, 240 consumer packaged boxes or 1200 consumer packaged boxes. It is not
enough for two parties to agree to use a particular qualifiers indicating case, pack, box or each; they must also agree on what
that particular qualifier means.
EDI Translation Software interfaces between the
internal system and the global standards. For an "inbound" document it typically takes the variable length fields of the EDI
document, translates the individual pieces of data and then creates a file of fixed lenth fields. For an "outbound" document the
translation software queries the internal system, as in the case of an SQL database, or it
translates a fixed width file exported by the internal software. Translation software may also utilize other methods or file
formats. The mechanism of translation is not part of the standard.
Note: In EDI terminology "inbound" and "outbound" refer to the direction of transmission of an EDI document in relation to a
particular system not the direction of merchandise, money or other things represented by the document. For example an EDI 940
document that tells a warehouse to perform an outbound shipment is an inbound document in relation to the warehouse computer
system. It is an outbound document in relation to the manufacturer or dealer that transmitted the document.
- EDI Data structure - Transaction sets, segments, data elements, composite data elements, and sub-elements.
- EDI Translation software.
- The store and forward of data transmission.
- The difference between X.12 and EDIFACT.
- New-edi - a method developed by the Standards Council of Australia.
- XML/EDI - OASIS, Rosettanet, etc.
- EDI vs edi - "EDI" being the global international standard and all it entails. "edi" being the non standard and proprietary
implementations used by individual organisations.
- Tradacoms - an example of retail
industry-specific EDI
- History of EDI.
- Politics of EDI.
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