10_EDI_EDIFACT+ANSI_X12_15-Jun-2024_SRC.docx

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Electronic Data Interchange (EDI) , EDIFACT, ANSI-X12 standards,

benefits of EDI
Electronic Data Interchange (EDI) is a way for companies to send and receive business
documents like purchase orders and invoices electronically, using a standardized format.
This means that instead of sending paper, businesses can transmit data directly from one
computer system to another.
This process is faster and reduces errors because there’s no need to re-enter data manually.
EDI is widely used because it helps companies manage their transactions more efficiently
and with fewer mistakes
Security is a critical advantage of EDI, as electronic transmissions are encrypted, reducing

the risk of interception and fraud compared to paper documents. EDI standards, such as
ANSI X12 and EDIFACT, ensure consistent and correct interpretation of data by all parties
involved Source.
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https://www.edibasics.com/what-is-edi/what-comprises-an-edi-document/

What are the potential Benefits of EDI (Electronic Data Interchange)

Speed and Efficiency:
EDI speeds up business transactions by automating data exchange, reducing processing
times significantly Source. In India, Reliance Retail uses EDI to streamline supply chain
operations, ensuring faster restocking of products.
Accuracy and Reduced Errors:

EDI reduces manual data entry errors, ensuring more accurate information exchange
Source. Tata Steel in India implemented EDI to minimize errors in their order processing
and improve overall data accuracy.
Cost Savings:
By eliminating paper-based processes and reducing manual labor, EDI helps companies
save on operational costs Source. Infosys in India adopted EDI to cut down on
administrative costs associated with their procurement processes Source.
Enhanced Security:
EDI ensures secure data transmission with encryption, protecting sensitive business
information from unauthorized access Source. ICICI Bank in India uses EDI for secure
financial transactions, enhancing data security and compliance.
Improved Supplier Relationships:

EDI facilitates better communication and coordination with suppliers, strengthening
business relationships Source. Mahindra & Mahindra improved their supplier management
by adopting EDI, leading to better coordination and timely deliveries .


EDIFACT
EDIFACT stands for Electronic Data Interchange For Administration, Commerce, and
Transport. The United Nations developed the EDIFACT.
ANSI X12
The American National Standards Institute created the EDI format ANSI X12.
The ANSI X12 is more popular compared to other EDI standards.
What are the components of EDI (Electronic Data Interchange) ?
EDI Standards:( EDIFACT or ANSIX12 or else)
EDI standards like ANSI X12 and EDIFACT ensure that documents are formatted
consistently, facilitating seamless communication between different systems Source.
Walmart uses ANSI X12 to streamline its supply chain operations, enhancing efficiency and
reducing errors Source.
EDI Software:
EDI software translates internal data into standardized EDI formats, enabling automated
document exchange. Ford implemented EDI software to improve inventory management
and reduce lead times in its supply chain Source.
Communication Networks:
Secure communication networks, such as Value-Added Networks (VANs) or AS2 protocols,
transmit EDI documents between businesses securely. Coca-Cola uses secure VANs to ensure
the reliability and security of its business transactions Source.
Mapping and Translation Tools:
https://www.79consulting.com/components-of-electronic-data-interchange-edi/
Mapping and translation tools match data fields from internal systems to EDI formats,
ensuring accurate data interpretation. Healthcare providers use these tools to process
insurance claims accurately and promptly Source.
EDI Integration:
EDI integration connects EDI systems with internal business applications like ERP and
CRM, automating data flow and reducing manual entry errors. Dell integrates EDI with its
ERP systems to manage orders efficiently, resulting in faster processing and improved
customer satisfaction Source.



How EDI works?

The data or the information that one company sends the other first gets prepared to be sent,
then the information/document is translated into EDI format. The document is then
connected and transmitted to the other business, the connection is direct and point to point.


What is a Data Element?

The data elements in an EDI Transaction Set are the individual items of information
within the document.
● Data type of numeric, alphanumeric, date or time
● Minimum and maximum length
● Code values, (e.g., US dollars or euros) is being used in the unit cost field

What are EDI Envelopes?

EDI document transmission uses a system of three “envelopes” to house your
transaction sets – Message envelope, Group envelope and Interchange envelope.


Case Studies of EDI

● Walmart: Uses ANSI X12 EDI standards and secure communication networks to
streamline its supply chain, enhancing efficiency and reducing costs Source.
● Ford: Implemented EDI software to improve inventory management and reduce
lead times, demonstrating the benefits of automated data exchange Source.
● Coca-Cola: Utilizes secure VANs for transmitting business transactions, ensuring
data security and reliability Source.
● Healthcare Providers: Use mapping and translation tools to process insurance
claims accurately and promptly Source.
● Dell: Integrates EDI with ERP systems to manage orders and inventory efficiently,
improving order processing and customer satisfaction Source.

What’s the Difference Between EDI and API?
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10_EDI_UN_EDIFACT_US_ANSI_X12 src7bppimt@gmail.

Electronic Data Interchange (EDI) , EDIFACT, ANSI-X12 standards,

Security is a critical advantage of EDI, as electronic transmissions are encrypted, reducing

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What are the potential Benefits of EDI (Electronic Data Interchange)

Accuracy and Reduced Errors:

Improved Supplier Relationships:

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What are the components of EDI (Electronic Data Interchange) ?

EDI Standards:( EDIFACT or ANSIX12 or else)

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How EDI works?

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What is a Data Element?

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What are EDI Envelopes?

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Case Studies of EDI

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What’s the Difference Between EDI and API?

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