1. EDI

2. EDI Short for Electronic Data Interchange
the transfer of data between different companies using networks, such as the Internet or a VAN.
ANSI has approved a set of EDI standards known as the X12 standards.
Source: k - Sep 14, 2005

3. EDI Business Transaction Cycle
Here is a typical EDI business transaction cycle using a dial-up or network connection to a Value-Added Network (VAN):
Customer sends a purchase order (EDI 850)
Supplier sends an acknowledgement notice (EDI 997)
Supplier sends an advance shipping notice (EDI 856)
Customer sends an acknowledgement notice (EDI 997)
Supplier sends an electronic invoice (EDI 810)
Customer sends another acknowledgement notice (EDI 997)
Customer sends an Electronic Funds Transfer (EFT) payment
Source:

4. EDI * = separates the elements in the segments FOB*CC*****OR*YORK
FOB = the segment name
FOB01
CC = shipment method of payment either CC (collect) or PO (prepaid only)
Mandatory and can be 2 0f 2 bytes in length
FOB02
FOB03
FOB04
FOB05
FOB06
OR = origin of shipping
FOB07
YORK = FOB city 1 to 80 bytes long
* = separates the elements in the segments

5. EDI - Advantages Automated Standardized
Efficient – handle large volumes
Cost Savings – each transaction $0.02 to $0.05
Eliminates errors
Fast

6. EDI - Disadvantages Older technology
Standardized – less flexible format
Startup costs
Network downtime stops process
Limit trading partners to those with EDI
Debugging issues