What is EDI? Is it relevant today?

Updated: Jan 6, 2020

Imagine... your boss walks into your office and says "Company XYZ is demanding that we start sending purchase orders via this thing called EDI! Can we get this done in the next two weeks?". Many of us don't have to strain our imagine, as we have been in this exact situation.

What is EDI? EDI is an acronym for Electronic Data Interchange. When someone says "EDI" they generally are referring to the end-to-end solution, generating the EDI document, the specification of the data format, and the transmission of the file to the receiving trade partner. The company you are exchanging EDI documents with are referred to as "Trade Partners". In the 1960's the earliest stages of EDI can be traced specifically to transportation industry. The development of EDI was a solution to the problem related to the volume of data that would otherwise be manually entered, and re-entered into freight management and customs clearance systems.

Starting in the mid 1980s EDI standards started to appear. EDI documents have a specific data format that conforms to the standards version, EDI version, and document type. Then the document is generally encoded as a plain text document.

The following is an example of EDI code.

Not many technologies from the 60's have remained relevant today, so this leads to a question.

Is EDI still relevant today, in 2020?

The answer is yes! Why? This can be answered in one word, Inertia. EDI is the international language of business. Is it perfect? No. Is it widely adopted? Yes. Does it empower automation to business processes? Yes.

Some of the larger challenges with EDI is integration with trade partners, and deviation from the standard that some trade partners introduce. The key to overcoming these challenges, is having a robust platform like Boomi that simplifies the integration and makes it possible to adapt to each trade partner's implementation of the EDI standard.

If you have a surprise EDI project let the professionals at Levogy (615-590-9005) help you adopt EDI in a scaleable and reliable way.

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