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Electronic Data Interchange

EDI developed in the 1960s as a means of accelerating the movement of documents pertaining to shipments and transportation. Not until the mid-1980s, however, was the technique used in a wide range of industries – automotive, retail, transportation and international trade. Its use is growing and it sis set to become the standard by which organization will communicate formally with cash other in the word of electronic commerce.

Electronic commerce is often equated with EDI, so it is important to qualify that electronic commerce adopts EDI and much more. In electronic commerce, EDI techniques are aimed at improving the interchange of information between trading partners, suppliers and customers.

Because of the different approaches in the development and  implementation of EDI, there is no consensus on a definition of EDI. A review of some of the prevailing definitions follows:

Definition. “Electronic Data Interchange is the transmission, in a standard syntax, of unambiguous information of business or strategic significance of computers of independent organizations. [The Accredited Standard Committee for EDI of the American National Standards Institute].”

Definition. “Electronic Data Interchange is the interchange of standard formatted data between computer application systems of trading partners with minimal manual invention. [UN/EDIFACT Training Guide]”.

Definition. “Electronic Data Interchange is the electronic transfer, from computer to computer of commercial and administrative data using an agreed standard to structure an EDI message.”

Definition. “Electronic Data Interchange is the electronic transfer from one computer to another of computer processable data using an agreed standard to structure the data.”

Another aspect of EDI that often causes confusion is its usage in one context as a technological solution that focuses on the mechanical transport and assembly of business forms and in other context as a business methodology that focuses on the content and structure of forms. This confusion can be cleared by examining the layered architecture of EDI.

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