Retail Supply Chain: The Future Of B2B Leaders - The Transition From Operations To Business Value Drivers

EDI (Electronic Data Interchange) is a set of standards that enable computer-to-computer exchange of information for highly automated processes. It enables the electronic exchange of documents in bulk between multiple parties, whether they are inter or intraorganizational. The information is exchanged in a standard format that all of the parties in the loop follow. To be effective, EDI should also comply with the guidelines set by various national and international agencies. In the US, the standard set by the American National Standards Institute (ANSI), Accredited Standards Committee (ASC) X12 is largely followed. However, in Europe the International Standards Organization and United Nations' Economic Commision for Europe (UN/ECE) have set Electronic Data Interchange for Administration, Commerce and transport (EDIFACT) as the standard for EDI..

Why do companies implement EDI?

Initially, business implemented EDI to gain speed over the traditional methods of recording transactions. This had the added benefits of improving order accuracy and subsequently accelerating the order-to-payment lifecycle. Suppliers, however, have often had to be mandated to use EDI. This was done in order to make the hub see a future potential in EDI. However, over time the concentration of EDI's value proposition has changed from solely benefiting the hub to providing better support to the trading partners.

The role of the EDI professional is currently undergoing a transition. Until now, the role of an EDI professional was reactive and focused mainly on managing the existing system. With the advent of new processes and standards, the role of an EDI professional is now a more proactive one. The onus is on the EDI professional to gauge future trends and demands in order to keep the business agile. To this end, automation will be his ally. Also, he will have to develop more process-focused and metric-based management.