Electronic Data Interchange (EDI) is a process with the help of which computer to computer exchange of business documents is possible in between two different computers in a standard electronic format. It is almost the same as that of the e-mail but the main difference between the email and EDI is that while email needs to be handled by people in EDI everything is handled by the computer. In the EDI process no pen, paper or people are involved. The biggest advantage of EDI is that the documents can straightway flow to the appropriate application on the computer of the receiver and the processing can be started instantaneously. This is how EDI can help to enhance the productivity and efficiency of the company. That is the reason why every company should have EDI Integration Expertise which includes EDI strategy and consultation, trading partner onboarding, mapping, EDI testing, software upgrades and configuration, integration with back-office solutions and project management. Many companies are now adopting the EDI solution for connecting to their business partners depending on the size and frequency of their transactions.
Types of Electronic Data Interchange (EDI)
There are various types of Electronic Data Interchange (EDI) and some of the important types of EDI are given as follows:
- Direct EDI: Direct EDI is also called as point-to-point EDI. It helps in establishing a single secure connection between two business partners. In simple words, you can say that it is an alternative to VAN. In this process, the company will be able to communicate with each of its business partners individually and thus can manage thousands of separate connections. The process of direct EDI is highly used by many large corporations which mainly used to exchange a lot of EDI documents very frequently. However, this model is quite complex as it involves a wide range of communication protocols and for connecting to the business partners all the communication protocols must be used and supported.
- EDI via VAN: A lot of EDI occurs through VAN. EDI via VAN is actually a very flexible and low-cost approach and is certainly a very preferred method as the VAN providers offer a lot of value-added services. Apart from the secured connection EDI via VAN also delivers full mailbox service in which all the messages are routed to the appropriate mailbox automatically. The business partners who are connected to the VAN will be able to retrieve the messages. Moreover, EDI via VAN also inspects and authenticate all EDI messages. Thus the identity of the business partners and the validity of the messages will be verified automatically. It also has a complete audit trail in which the entire EDI messages can be tracked and recorded. Another significant feature of EDI via VAN is that it provides message notification and thus the business partners will be notified automatically whenever any message enters in their mailbox.
- EDI via AS2: EDI via AS2 is another popular method of transferring the data securely and reliably over the Internet. It involves client and server machine which are connected point to point via the Internet. For sending the data securely AS2 creates an envelope and use digital certificates and encryption over the Internet. EDI via AS2 wants the server of the receiving business partner to be heard out the message that is addressed to it. If the server of the receiving end does not take the call then the message will be missed.
- Web EDI: Web EDI is another most popular EDI which is mainly operated with the help of an Internet browser. It is almost the same as paper-based documents represented as a web form which contains various fields that the user needs to enter. When all the necessary information will be added in the form it will automatically convert into EDI message and will be sent through secured Internet protocols, for example, File Transfer Protocol (FTP), HyperText Transfer Protocol (HTTP), etc. Web EDI is ideal for those actually countries where there is limited IT and EDI skills. The best thing with Web EDI is that you do not require installing any kind of EDI software or there is no necessity for managing a complex EDI environment.
Mobile EDI: Mobile EDI is an emerging area although the EDI application is not designed for mobile users. With the advent of iPad and tablet mobile, EDI has now become more suitable and the mobile EDI can change the way with the help of which users can interact with the business partners conveniently. In the process of mobile EDI data can be transferred to the receiver with the help of in-store docking station. Then the receiver can open and scan the document in the receiving system for verifying the quantities. The digital invoice will be closed when the data will be reconciled and the final copy will be transmitted to the supplier system with the help of the mobile device.
