Electronic Data Interchange, or EDI, is one of those terms that most of us have heard, some of us know we need and few of us understand. Fortunately, the technology and surrounding tools have advanced to the place where it’s not necessary to fully understand the behind-the-scenes operation of EDI in order to use it.
For those of us with a keen sense of curiosity, though, or for those who want to sound informed when asked, it’s important to understand a few of the basics about EDI.
In short, EDI is the computer to computer exchange of standard business documents, such as purchase orders and invoices, in electronic format. A standard file format is established for each kind of document (although they often get tweaked!) in order to facilitate the exchange of data across a variety of platforms and programs.
Sounds good, but what are the benefits?
Speed. Data can move between computer systems with little or no delay, resulting in better cash flow, faster buy-sell cycle time, shorter order lead times and even reduced inventories.
Accuracy. Errors are reduced due to the elimination of manual and duplicate data entry. This boosts overall efficiency and minimizes the risk of costly charge backs, leading to improved trading partner relationships.
Simplicity. EDI standards specify how data will be formatted and where it can be found, minimizing any burden on your IT staff.
Security. EDI can be accessed only by authorized users, and audit trails and archives add to security. Electronic confirmations ensure receipt – no chance of something “getting lost in the mail.” EDI data cannot be easily changed by unauthorized users and is not susceptible to viruses.
SWK Technologies can help you understand EDI and how it can help your company. In addition, there are a number of case studies on our MAPADOC website that talk about how companies across the country have successfully incorporated MAPADOC into their Sage MAS 90, 200 or 500 software.
Special thanks for Southeast Computer Systems for this article.