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Electronic Data Interchange

From: International Encyclopedia of Human Geography, 2009
Related phrases:
Electronic Commerce, Infrastructure for
I.A.2. Electronic Data Interchange (EDI)
In EDI, the digital equivalents of commonplace commercial enterprise documents, such as request for fees, purchase orders, and invoices, are transmitted electronically between the EDI-succesful agencies. These electronic files are given standardized electronic formats and numbers (called ANSI X12 fashionable), so every person involved can effectively interpret the information that is sent to them. Value-introduced networks (VANs), provided by organizations just like lengthy-distance cellphone companies or clearinghouses, offer connectivity between EDI-capable agencies.
Since EDI runs over proprietary networks, it's miles usually well seemed in phrases of reliability, protection and performance. However, EDI deployment and ongoing VAN subscription rates have validated too arduous for maximum agencies and EDI is being less extensively used nowadays.
Jae Kyu Lee, in Encyclopedia of Information Systems, 2003
V.B.2 Prospect of Internet EDI
Companies who presently own conventional EDI respond undoubtedly to Internet EDI. A recent survey by way of Forester Research on 50 Fortune a thousand organizations confirmed that nearly half of them plan to use EDI over the Internet. Frequently, companies combine the traditional EDI with the Internet by using having their Internet-based orders transmitted to a VAN or a carrier issuer that interprets the statistics into an EDI layout and sends it to their host computer systems. The Internet definitely serves as an alternative delivery mechanism to a greater expensive rent line. The combination of the Web, XML (eXtensible Markup Language), and Java makes EDI worthwhile even for small, infrequent transactions. Whereas EDI is not interactive, the Web and Java were designed in particular for interactivity in addition to ease of use.
VIII. EDI and its Problems
Presently, digital information interchange (EDI) is normally used to facilitate coordination and verbal exchange among supply chain companions—e.G., Wal-Mart and its essential vendors, as mentioned in advance. Thus, EDI addresses records flows that practice mainly to the interorganizational size of deliver chain coordination.
EDI is the direct computer-to-computer trade among two business companions (e.G., a manufacturer of finished items and a provider of raw materials) of widespread commercial enterprise files along with purchase orders and invoices. Others define EDI because the transmission of widespread commercial enterprise files in a trendy layout among business trading partners from computer application to pc software. EDI messages may be transmitted at once between enterprise partners or via a 3rd-birthday party cost-brought community.
EDI can assist agencies save money and time through decreasing transaction processing and information access fees even as gaining quicker access to records. Studies endorse that EDI reduces the human detail in conversation while enhancing both velocity and accuracy of records float. EDI can also help lower inventory costs by means of decreasing the time uncooked substances spend in inventory. Reductions in both leadtimes and stock stages, using EDI, were mentioned.
Unfortunately, EDI is not living as much as its promise for some of reasons. First, the participating organizations have to agree at the layout of a trendy, which is not as smooth for them to do on account that many of them are using one of a kind requirements. The American National Standards Institute (ANSI) developed the X.12 data interchange protocol as a bendy wellknown, however one of a kind industries have advanced exceptional variations of this trendy.
Second, software program is too costly and too proprietary. Specialized software program have to be advanced by way of participating corporations to convert incoming and outgoing messages in a common format this is comprehensible to other corporations, but simplest massive businesses can come up with the money for to do that. This makes EDI much less affordable to smaller organizations. Traditional EDI works higher between big groups with a high volume of transactions
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