EDI ??

EDI is computer to computer communication using a

standard data format to exchange business
information between companies.

EDI is doing business and carrying out it with your

trading partner electronically.
 BASIC FEATURES
COMPUTER TO COMPUTER: EDI replaces postal mail, fax
and e-mail. While email is an electronic approach, the
documents shared via email must still be handled by people
rather than computers. Instead EDI documents can flow
straight through to the appropriate application on the
receivers application and processing can begin immediately.
STANDARD: Because EDI documents must be processed by
computers rather than humans, a standard format must be
used so that the computer will be able to read and
understand the documents. There are several EDI standards
in use today, including ANSI, EDIFACT, TRADACOMS etc.
When two businesses decide to exchange EDI documents,
they must agree on the specific EDI standard and version.
Businesses typically use an EDI translator to translate the EDI
format so the data can be used by their internal applications
and thus enable straight through processing of documents
BUSINESS PERTNERS: The exchange of EDI documents is
typically between two different companies reffered to as
business partners or trading partners.
ADVANTAGES OF EDI.
Strategic business level :
It enables faster decision-making and improved responsiveness to
changing customer and market demands, and allows businesses to
adopt a demand-driven business model rather than a supply-driven one..
Eliminates duplication
Speed and accuracy.
Increase efficiency.
Improve consumer services
Increase productivity.
Environment friendly.
Expand consumer base.
Decision making.
DISADVANTAGES OF EDI.
Too many standards.
Edi is too expensive.
Limits scope of business.
Changing standards.
Tedious to handle .
High maintenance .
Implementations
DEVELOPING ORGANISATIONAL STRUCTURE: the
company must develop an effective organizational
structure in this regard. An experienced IT must be
employed to devise some appropriate plans and
discussing the relevant issues with department heads.
Issues related to customers, other business partners,
volume and type of transactions must be decided in
detail.
CONDUCTING IN-DEPTH ANALYSIS: an in depth
analysis must be undertaken to find out which part of
the organization is most ready for EDI and which cycle
will cost the least to implement EDI. An effective
implementation schedule must be prepared and got
approved from top level.
DEVELOPING A BUSINESS FOCUSED EDI
SOLUTIONS: a business focused EDI solution must be
developed keeping in mind the volume of expected EDI
traffic and IT infrastructure needed to support it, the
capacity of internal network infrastructure to support
EDI data and the network connection needed to
manage traffic with business partners.
SELECTING CORRECT EDI NETWORK PROVIDER:
the next step is regarding the selection of an EDI
network provider. It is entirely feasible for
organizations to implement EDI directly with one
another, but it is beneficial too use a third party
network service provider. The company must decide
whether it wants a basic EDI service or value added
service.
INTEGRATE EDI WITH THE BUSINESS: after purchasing
the necessary hardware or software to support EDI solutions a
skilled EDI programming staff must next convert the
requirement into reality. The basic tasks include: integrating
EDI with your in house business systems, extracting and
loading data, creating the EDI documents by mapping,
extracted data to the proper segments and data elements of
the EDI transactions, as well as installing and configuring the
communication software for sending and receiving
documents.

INTEGRATING DATA ACROSS BUSINESS: an analysis of

affected business system is done to ensure its ability to share.
Sometimes obstacles need to be overcome such as different
business systems may contain the same data but in different
formats. Data is broken into primary and secondary keys.
Proper understanding of the structure of the data is required.
UNDERTAKE DATA MAPPING: In the simplest terms, data
mapping is properly converting data into EDI file format and then
back again. The data must be properly arranged and formatted
so that it conforms to both the EDI standards and the trading
partners requirements.

ESTABLISH A PILOT PROJECT: After developing EDI system to

the best of its ability, further system tests must be conducted in
pilot mode with selected business partners. Pilot projects results
must be analyzed from an internal perspective. Paper
transactions must not be eliminated until both partners
performing pilot project are satisfied with its results.

ROLL OUT EDI TO BUSINESS PARTNERS: in this step EDI

program must be implemented with business partners and insist
all suppliers to receive purchase orders and return invoices via
EDI. After implementing company must effectively manage and
maintain the EDI program through skilled personnel.
 Challenges in EDI
Implementations.

Technology factor.
Human resource.
Resistance.
Trading partner participation.
Problem of integration , interoperability and
intercompatability.
Process of edi
A Program generates the file which
contains the processed documents.
The document is converted into an
agreed standard format.
The file containing the document is sent
electronically on network.
The trading partner receives the file.
An acknowledgement document is
generated and sent to the organization .
Paper based system
The buyer company enters data into
the purchase system to create the
purchase order prints and mail it.
After several days the suppliers
company receives the order and
manually enters it into the sales
order system.
The buyer manually enters the
invoice into the accounts payable
system.
Edi based system..
o The buyers procurement
system which utilizes EDI
software automatically
generates and sends an EDI
formatted purchase order.
o The supplier sale order
system using EDI software
receives the
purachaseorder, notifies he
shipping department to ship
the goods and generate an
EDI invoice to be
transmitted to the buyers
accounts payable system.
 MADE BY:
URUNIKA GOYAL & KANIKA

ROLL NO: 332 & 279

CLASS : BCOM 1 (E)
SUBMITTED TO: MISS HARSIMRAN .