What is EDI ?

- EDI Standards for

- The computer to computer exchange of standard format business documents between Trading partners

- Standard format - Trading Partners

- Business Documents

Standard format: All EDI transactions are defined by Standards. An EDI Standard document is an established layout or format, of a business document. Standards determine the order and location of the units of data in an EDI document, ensuring that information from a paper document corresponds to information in an EDI Standard document. Business documents: Examples include purchase orders, Invoices, Ship notices, Transcripts, and Medical records. Trading partner: Any organization, Company or entity with whom you exchange information , goods or services.

EDI is the paper less exchange of business documents, such as invoices and purchase orders.
EDI documents contain the same information as paper documents, but they are formatted in an EDI Standard format. With EDI software you can transmit a document from an application on your computer to an application on another companys computer. You send and receive EDI documents over a communications line. You can also use a tape, diskette or e-mail to exchange EDI documents with your trading partners.

EDI Document Standards Committees In the late 1970s and early 1980s, the American National Standards Institutes Accredited Standards Committee (ASC) established the ANSI ASC X12 Standard, a generic national document Standard designed for use by all industries. In the late 1980s, the International Standards Organization (ISO) and the United Nations Economic Commission for Europe developed EDIFACT (EDI For Administration, Commerce and Transport), a generic international Standard.

X12 and EDIFACT are the two most commonly used document Standards in the US and Europe today. The ANSI and ISO committees release new versions of X12 and EDIFACT Standards about once a year, thus there are multiple versions of most Standards in use.

Outbound
Outbound Transaction: When you send documents, EDI translation software translates the data from your file format into the EDI Standard format.

Your File Format (XML,Database,flat file)

EDI Software

EDI Standard Format

Inbound
Inbound Transaction: When you receive documents, EDI translation software translates the data from the Standard EDI format into your file format.

EDI Standard Format

EDI Software

Your File Format (XML,Database,flat file)

EDI Exchange

Your Application Data

Outbound EDI

Inbound EDI

Your Partners Application Data

Communication Media ( Ex: Van, IA etc..)

The Benefits of Using EDI

The benefits of transmitting documents electronically include n Speed. Documents are sent and received during the time periods you and your trading partner specify. You can set up communications sessions to run immediately or at regular intervals. Once documents are received, n Accuracy. Because the data does not need to be entered manually, typing errors are eliminated.

The Benefits of Using EDI

(contd)

n Increased business opportunities. Many companies require their trading partners to do business using EDI. Once you can market yourself as being EDI-capable, your potential for doing business with more companies increases.

n Reduced costs. The rapid turnaround of documents can help reduce inventory overhead, increase available cash flow, speed up the accounts payable and receivable cycles, and save payroll costs.
n Increased productivity. Your employees are available to learn and perform more challenging tasks instead of working on data entry assignments.

EDI Control Structure

Interchange Control Header
Functional Group Header Transaction Set Header

ISA
GS ST

Transaction Set Detail Segments

Transaction Set Trailer Transaction Set Header SE ST

Transaction Set Detail Segments Transaction Set Trailer Functional Group Trailer Functional Group Header Transaction Set Header SE GE GS ST

Transaction Set Detail Segments Transaction Set Trailer Functional Group Trailer Interchange Control Trailer SE GE IEA

Interchange. A group of functional groups being exchanged between two partners. Functional Group. A group of similar Transaction sets (e.g., five invoices). Transaction Set. The data exchanged between two partners that represents a single business document .

EDI Control Structure (contd)

Transmission Interchange Functional Group Transaction Set

Transaction Set
Functional Group Transaction Set

Transmission. A group of interchanges, typically batched from or for communications.

Interchange Functional Group

Transaction Set
Transaction Set

Sample EDI Data

ISA*00* *00* *12*8473179000 *12*9395100193 *970430*2251*U*00306*000000001*0*T*> GS*PO*006250740*3959910033*970430*2251*1*X*003060 ST*850*0001 BEG*00*NE*3859199838**950727***IBM REF*11*0039110**14>0090028 PO1*1*300*BX*145.39**CB*KOW-20392-10 PID*F****Uninterruptible Power System PO1*2*25*EA*35.68**CB*1093-4927-001 PID*F****High Volume Printer Stand PO1*3*4*PC*2002.91**CB*ABX-2001 PID*F****Electronics Cabinet Package (56" High) CTT*3 SE*11*0001 ST*850*0002 BEG*00*NE*3859199839**950727***IBM DTM*002*950731 PO1*2*1*PC*1039.45**CB*ABX-2039 PID*F****Electronics Cabinet Package (78" High) CTT*2 SE*7*0002 GE*2*1 IEA*1*000000001 Interchange

Functional Group

Transaction Set

Segment Structure
Segment ID
Data Element Composite

REF*11*0039110**14>0090028
Segment

EDI documents contain segments and elements.

n Segments are the rows of data in a document. n Elements are the units of data in a segment.

Interchange Envelopes
Element Separator

ISA*00* *00* *12*8473179000 *12*9395100193 *970430*2251*U*00306*000000001*0*T*> cr/lf . . Interchange . Control Number IEA*1*000000001
Segment Terminator Composite Delimiter

Number of Functional Groups (GS-GE) in Interchange

Functional Group Envelopes

Functional ID Code (identifies types of transaction sets to follow)

GS*PO*006250740*3959910033*970430*2251*1093*X*003060 . . Group Control Number . GE*2*1093

Version Release Indicator Code (indicates the version of the standard for the transaction sets to follow) Number of Transaction Sets (ST-SE) in Functional Group

Transaction Set Envelopes

Transaction Set ID (identifies transaction sets type)

ST*850*0001 . Transaction Set . Control Number . SE*11*0001

Number of Segments in the Transaction Set (from ST to SE)

Transaction Set Structure

ST*850*0001
Header

BEG*00*NE*3859199838**950727***IBM REF*11*0039110**14>0090028 PO1*1*300*BX*145.39**CB*KOW-20392-10 PID*F****Uninterruptible Power System PO1*2*25*EA*35.68**CB*1093-4927-001 PID*F****High Volume Printer Stand PO1*3*4*PC*2002.91**CB*ABX-2001 PID*F****Electronics Cabinet Package (56" High)

Detail

Summary

CTT*3 SE*11*0001

Any organization, company, or entity with whom you exchange information, goods, or services is called your EDI enables trading partners to exchange documents and information quickly and efficiently. To send and receive documents electronically with a trading partner, you must n Establish common parameters for the documents you will exchange n Plan the format of the documents

n Create the structure for the documents

n Set up the EDI software so that it can translate the documents you exchange
n Define the types of envelopes you will use to transmit the documents n Choose the network you and your trading partner will use to transmit documents

You and your trading partner must establish common parameters for each type of document to be transmitted. These parameters identify n the sender and receiver of documents n the document type (such as purchase order, acknowledgment, or invoice)

n which Standard and version of the document you will use ( Ex: ANSI X12 4010, 4030 )
n which data elements your companies need

In a paper-based system, a company might receive business documents in many different formats, depending on the format used by the sender. Employees can read, interpret, and extract pertinent information from each document, regardless of its structure.

A computer, however, can only read and process data that is structured in the exact format the computer expects.
To ensure successful EDI transmissions, you and your trading partner must agree on the format of the documents you exchange, so that your systems will be ready to receive and process documents in the expected formats.

In paper-based transactions, a business document usually consists of three parts: Header :The preliminary information about the entire document, such as the company name and address of the sender and receiver, and the date of the document. Detail :The information contained in the actual business transaction. The details in a purchase order, for example, could include descriptions of the product, quantities ordered, and prices. Summary: The summary data about the entire document, such as total charges or payments.

EDI documents are formatted according to the document Standard. The Standard specifications for segments and loops can include n the sequence in which segments must be transmitted n whether each segment is mandatory, conditional or optional n the maximum number of times segments and loops can repeat n which segments are grouped together in loops n the purpose of the segment n the data elements that appear in the segment n data segment terminators

The Standard specifications for elements can include n n n n n n reference numbers element definitions the type of element, such as numeric, alphanumeric, or date minimum and maximum lengths valid element codes data element separator

In paper-based communications, individual documents or groups of documents are usually mailed in envelopes labeled with sender and receiver addresses. When multiple documents are mailed in one envelope, the receiver can distinguish individual documents and document types. Electronic documents, however, are transmitted as continuous streams of data. For this reason, EDI Standards provide both electronic outer envelopes containing sender and receiver information, and electronic inner envelopes that separate groups of documents and individual documents. Each envelope encloses the data that falls between the envelopes beginning segment (header) and ending segment (trailer).

To transmit EDI documents to your trading partner(s), you can use a VAN or transmit a document directly to your trading partner. For VANs and direct connects, Harbinger provides over 35 predefined network modules, including the Harbinger VAN and the IBM International Global Services Network. You and your trading partner can select one of Harbingers network modules, or you can select a different VAN.