Skip to main content

Working of EDI

A two-way working process (figure 2.15) of EDI-based transactions between vendor and supplier:


After business agreements are reached between the two EDI-enabled partners, no human touch is required. The ultimate EDI implementation is a totally automated interaction between the business applications. A step-wise execution of processes involved in EDI transaction for purchase, shipment, and payment is as follows: 
1)The sender's EDI translation software translates the document into a standard format and establishes the communications connection by dialing telephone number of the network.
 
2) The message from the sender is transferred to an electronic mailbox on the network. From the electronic mailbox, the trading partner's software will retrieve the file, interpret the message, check that it complies with the EDI standards, and finally store it. It also sends a functional acknowledgement to inform the sender if the message was received and complied with the EDI standard.

3) To read and process the interpreted message, the receiver has two options. either use the EDI translation software to produce a hard copy of the message or re-structure (map) the message into a format required by the existing computer applications before further processing.

Previous Next


Labels:

Comments

Post a Comment

Popular Post

What is COVID-19 ?

COVID-19 is a disease caused due to the infection of novel coronavirus. The first case of COVID-19 disease was founded at Wuhan, China in December 2019. It also named as severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). COVID-19 is the most widely spread disease ever in the world. In most cases it infects the respiratory system that causes fever, dry cough, and shortness of breath. Previous : What is the difference between coronavirus and COVID-19 ?
Post a Comment
Read more

EDI and Business

Organisation that Uses EDI     1) Wal-Mart : An EDI link between Wal-Mart and one of its suppliers, Seminole Manufacturing Co. cut the delivery time of Seminole slacks by 50%. This resulted in a 31% sales increase of these slacks in the first 9 months after the link was established.   2) General Motors : General Motors have integrated EDI Electronic funds transfer at 30% of its assembly plants. Shipping receipts are sent electronically from the GM plant to an Electronic Data System (EDS is subsidiary of GM) computer center where they are matched against electronic invoices and purchase orders.   Suppliers group the shipping receipts, and one payment is made. This single payment may represent dozens of different shipments to different plants. These payments are also performed electronically via Electronic Funds Transfers.   3) J C Penney : Sales of Stafford suits jumped 59% after JC Penney linked up with their supplier Lanier Clothes. EDI allowed Penney to quickl...
Post a Comment
Read more

EDI Maturity Model

The development of EDI within an organisation or a trade sector goes through a number of stages. Saxena and Wagenaar suggest a three stage EDI maturity model as a part of a three-way analysis of EDI development in organisations, trade sectors and nations.  Figure 2.20 shows the concept of EDI maturity with a six-stage maturity model, and links it to the opportunities for competitive advantage. The stages of EDI development as represented in the model are:  Stage 1:Discovery : The first stage in EDI development is the discovery stage. Discovery can be by an organisation choosing to adopt EDI to gain competitive advantage or to solve an administrative problem.  Stage 2: Introductory : This stage requires investment hardware and software but, atleast significant, will be the time commitment in establishing the parameters of the electronic trading relationship. This stage, on its own, does not result in any cost saving or efficiency gain. there are direct costs in computer ...
Post a Comment
Read more