byon 07-14-2012 at 10:23 AM (194 Views)
"EDI is brief for Electronic Data Interchange. It is a trade exchange technique that replaces common organization forms and documents such as acquire orders, invoices, shipping documents, etc., with a personal computer-based communications and records keeping program.
Another definition of EDI: Electronic Information Interchange is the inter-organizational, computer-to-computer exchange of business documentation in a regular machine-processable format.
There are a number of key points in this definition that tends to make EDI quite different from other types of paper or electronic communications. Firstly, EDI happens between companies, it is cross enterprise. While the growth in the use of computer systems and other advanced technologies has been tremendous for the duration of the past decades, the same trend is beginning to happen amongst companies. Even though the technologies of EDI can be utilized internally within an organization, by definition EDI is organization to organization.
EDI occurs among computer systems. The purpose of EDI is not to remove paper, but rather to eradicate the time and the information entry related with paper. It is usually accepted that 70 percent of one computers organization data output becomes a second computers data input. In a paper environment with out EDI this signifies that the very same info is getting entered, in different processes, into each computers. With EDI, the computers are linked such that duplicate information entry does not take place.
The purpose of EDI is to boost the flow and management of business details. Any information that, nowadays, is on a business form of any sort, is appropriate for EDI. EDI is presently becoming utilized for all of the most common company transactions such as acquire orders, invoices, quotes, bills of lading, status reports, receiving advices and also for some quite certain transactions such as residential mortgage insurance applications, healthcare claim payments, and material security data sheets.
Because EDI is computer-to-computer system communication, rather than personto-individual communication, the data being exchanged in EDI ought to be understandable to a personal computer. This means the data need to be in some pre-established, structured format, thus allowing the information to be read and understood by the computer with out human interpretation.
As stated earlier, the objective of EDI is to boost data management. EDI accomplishes this by reducing non-value added time and eliminating redundant data entry. The basic functioning of EDI, as compared to a paper-based system is illustrated in the paragraph beneath.
In the standard EDI transaction that would be shown in a figure, the buyers computerized purchasing technique creates an order on a paper form. The paper purchase order is delivered through some manual program to the supplier. When the order is received by the supplier, an order entry clerk abstracts information from the obtain order and enters it into an order entry technique. With EDI, on the other hand, the information moves directly from the buyers personal computer to the sellers pc, without any delivery or processing delays. In EDI, the transformation to a paper format, the interpretation of that paper format by an order entry clerk, and the re-entering of the data are functions that are no longer necessary. <a href=http://www.proedi.com/logistics.htm>edi trucking[/url]"