ELECTRONIC DATA

INTERCHANGE IN
INTERNATIONAL BUSINESS
MEANING AND
DEFINITION
Electronic Data Interchange (EDI) may be
understood as the replacement of paper-based
purchase orders with electronic equivalents.
Electronic Data Interchange (EDI) refers to the
structured transmission of data between
organizations by electronic means.
A more careful definition of EDI is 'the exchange
of documents in standardized electronic
form, between organizations, in an
automated manner, directly from a
computer application in one organization to
an application in another'
MEANING AND
DEFINITION
The EDI system coordinates the transaction,
initiates deliveries, and generates invoices.
EDI defines the electronic exchange of structured
business data, such as purchase orders, invoices,
and shipping notices, typically between one
organization and another.
HISTORY

OF EDI
The early applications of EDI were undertaken in the
United States IN AUTOMOBILE INDUSTRY .
The idea's origins is traceable back to the 1948
Berlin.
Electronic transmission commenced during the
1960s, initially in the rail and road transport
industries
In 1968 the United States Transportation Data
Coordinating Committee (TDCC) was formed, to
coordinate the development of translation rules
among four existing sets of industry-specific
standards. A further significant move towards
standardization came with the X12 standards of
the American National Standards Institute (ANSI),
COMPARISON BETWEEN EDI
AND EMAIL
EDI can be compared and contrasted with
electronic mail (email). Email enables free-format,
textual messages to be electronically transmitted
from one person to another. EDI, on the other
hand, supports structured business messages
(those which are expressed in hard-copy, pre-
printed forms or business documents), and
transmits them electronically between computer
applications, rather than between people.
 IMPLEMENTATIONS AND

SPECIFICATIONS OF EDI
IMPLEMENTATIONS


THERE ARE TWO WAYS OF IMPLEMENTING EDI:

 CREATING PERSONAL proprietary systems, MOST
OFTEN DONE BY LARGE ORG.
 USING VAN (VALUE ADDED NETWORKS).
SPECIFICATIONS :
 ANSI ASC X12 (American National Standards-
X12
 UN/EDIFACT
 OPEN EDI
 EDI AND XML

BENEFITS OF USING EDI
EDI saves unnecessary re-capture of data.
 faster transfer of data, far fewer errors, less time
wasted on exception-handling, and hence a more
stream-lined business process.
Benefits can be achieved in such areas as inventory
management, transport and distribution,
administration and cash management.
EDI offers the prospect of easy and cheap
communication of structured information throughout
the government community, and between
government agencies and their suppliers and clients.
Because EDI necessarily involves business partners, it
can be used as a catalyst for gaining efficiencies
across organizational boundaries.

ADVANTAGES OF EDI OVER
PAPER WORK
EDI helps in reducing expenses by replacing
information flows that require a great deal of
human interaction and materials such as paper
documents, meetings ,faxes etc by c2c data
flow.
EDI and similar technologies allow a company to
take advantage of the benefits of storing and
manipulating data electronically without the cost
of manual entry.
 EDI is advantageous reduced errors, such as
shipping and billing errors, because EDI
eliminates the need to rekey documents on the
destination side.
Helps in just -in-production systems by enhancing
THE ROLE OF EDI IN SUPPLY
CHAIN MANAGEMENT
Goods can’t move faster than the information that
controls them.
Information is crucial for efficiency and security of
the SC.
Trade documents are the core means of
exchanging this information.

 Costs to Export: India / Germany
India Germany

900 – 900 –
$75
750 – $45 750 –

600 – 600 –
$194
$404` $31
450 – 450 –
$ S U- st s o C

$ S U- st s o C
300 – 300 – $443
150 – $340 150 –

0– 0–
$63

-
-

A B C -
D A B C D

Total duration: 27 days Total duration: 6 days

Total cost: $864 Total cost: $731
Germany India (days)
(days)
3 11
A.Documents Preparation
1 6
B.Inland transportation and handling
1 4
C.Customs clearance and technical control 1 6
D.Ports and terminal handling
Source: World Bank; Doing Business (http://www.doingbusiness.org)
SUMMARY


Trade documents are a key instrument to

increase efficiency of international trade
Modern supply chains require integrated
management of the information exchange
UNeDocs integrates paper and electronic trade
documents based on international standards
and best practice
Data models such as UNeDocs and WCO DM
provide a basis to facilitate cross border
information exchange

BIBLIOGRAPHY
www.unece.unorg
www.wikipedia.com
http://www.anu.edu.au/people/Roger.Clarke/EC/EDI


THANK YOU !!
 PRESENTATION BY :-
 GAURAV SHARMA
 MBA-FT(5YRS)
 III SEM.