What is Electronic Data Interchange?
EDI is the exchange of business documents – such as purchase orders and invoices – in a standardised, electronic format between business partners. There are wide-ranging benefits of replacing paper documents with electronic documents and exchanging documents in a standardised format.
The traditional exchange of paper-based documents is time-consuming, wasteful, error-prone, inflexible, and generally inefficient. By automating this process organisations can eliminate costly errors, significantly reduce costs and dramatically improve efficiency to become a streamlined, dynamic, agile business which is ready to embrace the challenges posed by the modern business environment.
Organisations today are operating in an ‘on demand’ environment with increasing numbers of suppliers, trading partners and customers expecting – even stipulating – round-the-clock, real time electronic trading. The accompanying technical complexities of managing, supporting and communicating with such a diverse community coupled with potential industry-specific requirements adds further pressures – particularly if organisations are trading globally.
EDI has been around for many years. But the wide adoption of the internet (and particularly with the advance in broadband connection speeds) has represented a turning point as it provides a robust, more flexible and cost-effective alternative to traditional EDI solutions.
Business integration has improved rapidly in recent years with many leading organisations already implementing EDI in one form or another. However, one thing is certain – evolution will continue and organisations who do not trade electronically will simply be left behind.
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