AJAI SACHCHAR ANAMIKA SHARMA

TEAM 5

RAM KUMAR
SUMMIYA SAIFY

RAVI CHAITANYA

KRISHNA SUHAS
 DEFINITION OF EDI
• EDI can be defined as…

– Structured transmission of data between organization by

electronic means
– It is easier to describe the commonly used EDI practices.
The collection of these common practices amounts to
what is known today as EDI.
– EDI can be thus described as an information sharing
system utilizing an intermediate message store-and-
forward entity and premeditated message syntax and
interaction processes which are modeled by trading
partners around standard templates.
• EDI is an agreement controlling the electronic
transmission of business processes in which
formalized/structured data are exchanged
between business partners.
• Eg. PHOENIX CONTACT
 ADVANTAGES
• Order data is only recorded once
• Administrative costs for collecting, distributing and archiving
paper-based documents are reduced to a minimum
• Information exchange between companies is accelerated (in
particular with international relations)
• Internal processes are accelerated as a result of direct data
transfer without entering data manually
• 24-hour availability and no problems with time zones
• No more errors due to manual data input
• Greater security for planning and materials handling
• Improved material tracking
• Locational disadvantages are compensated
 History of EDI
• The earliest implementation of a system compliant
with EDI is the British Automated Clearing Service
(1970).
• Other early examples include LACES (1971-1981), a
freight clearing system used at Heathrow and WMO,
the World Meteorological Office system used to
share weather information.
• Preliminary initiatives of trading groups increased
and standardization in Europe soon became needed.
• North America had similar problems with industry
groups making up their own standards rapidly.
 The Structure of EDI Systems
• The basic EDI structure is given below.
– Each partner has their own internal software systems.
– Special EDI adapters have to be implemented which will
be able to interface with the internal system as well as
communicate with the value added network.
– The particulars of the message syntax and interaction
process are negotiated between partners in advance.
Sometimes a dominant partner will impose its standards
on smaller partners.

Partner A Partner B
Internal
System
EDI Software
VAN
VAN EDI Software Internal
System
 Security and Privacy in EDI

• Digital Signatures / Encryption

• EDI Checks

• Internal • EDI • Proto • EDI• Internal

•
• System• AdapterCommscol • Comms • System
• Adapter
• Check
s

• EDI Acknowledgement
(physical)

• EDI Acknowledgement
(logical)
 Value Added Networks
•The go-between in EDI
communications
•Responsible for routing,
storing and delivering EDI
messages Provide delivery
reports
•Intelligent VANs are able to
read the EDI message itself.
•Operated by various entities
Telecom companies
Industry group consortiums
A large company interacting
with its suppliers/vendors
 EDI Outsourcing

•Complex operations
•Integration service provider
•Internet based service provider like cloud
computing
•Services like document translation
services, complete EDI systems that
include warehouse management and
financial software, scan-packing and label
printing interfaces.
 EDIFACT
• EDI for administration, commerce and
transportation.
• Introduced by the UN center for the facilitation of
administration, commerce and transportation
(UN/CEFACT) in the mid 1980s.
• Older European EDI standards such as TRADACOM,
GENCOD, SEDAS and ODETTE have all migrated to
EDIFACT.
• It has become an international standard as ANSI has
stopped all work on X12 since 1997 and X12 systems
are migrating to EDIFACT
 EDIFACT: Structure
• EDIFACT Interchanges consist of messages
which are in turn composed of data
segments. The segments themselves consist
of data elements. Interchange
I’change Header Message Message Message I’change Header

Message Data Data Data Message

Header Segment Segment Segment Header

Data Data Data

Element Element Element
 An EDIFACT message
UNB+IATB:1+6XPPC+LHPPC+940101:0950+1'
UNH+1+PAORES:93:1:IA'
MSG+1:45' IFT+3+XYZCOMPANY AVAILABILITY'
ERC+A7V:1:AMD' IFT+3+NO MORE FLIGHTS' ODI'
TVL+240493:1000::1220+FRA+JFK+DL+400+C'
PDI++C:3+Y::3+F::1' APD+74C:0:::6++++++6X'
TVL+240493:1740::2030+JFK+MIA+DL+081+C'
PDI++C:4' APD+EM2:0:1630::6+++++++DA'
UNT+13+1' UNZ+1+1'
 Uses of EDI
• Financial and monetary.
– Systems like SWIFT and EFT all use EDI.
• Governmental.
– Payroll operations.
– Official information sharing (e.g. For motor vehicle
information, visas etc.).
• Transportation.
– IATA system is built on EDI. All airplane booking and
ticketing operations done over EDIFACT
 Benefits of EDI
• Remove document re-keying

• Eliminate paper

• Reduce lead times and stockholding

• Increase the Quality of trading relationship

• Competitive advantage
 Drawbacks of EDI
• EDI adapter software is too expensive for most organizations.
• The software has to be practically rewritten for different
combinations of VANs, internal hardware and trading scenarios.
• The software is also subject to change when there is a revision in
EDIFACT
• VAN subscription costs and dedicated line costs are prohibitive
for most SMEs
• The EDI system is highly static and every business process has to
be meticulously negotiated between partners.
• Since there is no common registry or discovery mechanism,
partners have to retain information on institution codes, product
codes, up-to-date catalogs etc. associated with everybody they
do business with.
 Barriers to implementation
• High setup costs
• Incompatibility of hardware /software
• Lack of standard formats
• Lack of customer sophistication
• Lack of awareness of EDI benefits
• Customer education/training
• Customer resistance
• Corporate culture
THANK YOU