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Sivasubramaniam Arunachalam
September 09, 2011
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Introduction to EDI(Electronic Data Interchange)
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Agenda Definition
History
Message Flow
Before EDI
After EDI
Benefits
Transmission Mediums
Transmission Directions
Transmission Protocols
Implementation
Message Formats
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EDI - Definition
Business Documents
Electronic Transmission
Strtucted Data
Trading Partner to Trading Partner
Computer to Computer Communication
Sequence of Messages
Automate Standard Processes
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History
Early 1960s
TDCC
Private Company Standards
Private Industry Standards
Inter Industry Standards (ANSI / ASC)
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History - Timeline1968 - TDCC Formed
1975 - First EDI Standard
1978 - ANSI ASC Formed
1981 - Retail Grocery Industry
Uniform Communication Standard Program (UCS)
1982 - Public Warehousing Industry
Warehousing Industry Network Standards (WINS)
1983 - ANSI - First 5 American National Standards for EDI.
1988 - Auto Industry Action Group (AIAG)
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History – Timeline (Contd…)
1988 - UN formed UN-JEDI
Limitations of ANSI Standards
UN/EDIFACT
Adoption & Popularity
Immediate Benefits
Overseas Expansion
Expense Control
Elimination of Support for Multiple Formats
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Before EDI
Source : https://www.cybertext.com/books/primerprev/chapters/ch2.htm
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After EDI
Source : https://www.cybertext.com/books/primerprev/chapters/ch2.htm
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After EDI
Source : http://acs.lbl.gov/~johnston/EDM/Internet.and.RINS.3.fm8.html
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Benefits Post office cost
People cost
Error cost
Buyer Benefits
Lower Inventory Levels
Quick Order Acknowledgement
Matching and Re-Keying PO and Invoice
Supplier/Seller Benefits
No problems and delays caused by order entry errors (50)
Personnel Reductions (70)
Inventory Reductions
Improved Cash Flow
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Benefits - Need for Speed
Seconds instead of Days
Never put it any Basket for Collection
Receiver side data is immediately ready for processing
Different parties process the electronic document
Low Business Cycle times (competitive edge in any business)
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Benefits - Need for Accuracy Electronic data is usually derived from a database
Data has been subject to prior validation
Large Size and delivery failure never matters here.
Even it fails, re-transmission is possible
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Benefits - Cost Savings and Avoidance
Human handling
Mailroom Sorting, Circulation, Clerical document preparation
Data entry at multiple stages
Paper and it's Transmission Costs
Paper Cost, Envelopes , Mailing Materials , Courier services
Telephone calls to confirm
Paper storage space and it's protection
Low Error Rates and Low Handling of Error Rates
Labor to monitor, search and solve the error
Inventory Reduction
Low Stock Levels
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Benefits - Improved Operational Efficiency
For Customers
Quicker Delivery of Products (competition)
Better Customer service
Distributors performance
Vendor side
Track Supplier Performance Level
Track Supplier Stock Level
Transportation Carrier Performance
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Benefits - Improved Operational Efficiency (Contd…)
Precise Planning and Execution
Improved Cash Flow
Immediate payment
No Currency Conversion Factors
Net Discounts
Audit trials and status tracking
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Transmission Medium - Types P2P
Dial up Line
Leased Line
VAN
VPN
Web / Mobile
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P2P – Dial Up Dial-up line is established just like a normal telephone call
Sending party makes the call to Receiver & transmits the data
Batch/Bulk Processing
Cheaper when the amount of data is low and sporadic
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P2P - Leased Line Dedicated Line and expensive
Amount of transactions is high
Fairly constant throughout the day
No dial delay
No need to batch transactions
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VAN (Value Added Network) P2P scheduling problem to trading partners
Store and Forward Mailbox Service
Most widely used
Routing, Storing and Delivering EDI messages
Delivery Reports
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VAN – How it works Trading Partners chooses EDI VAN Provider
EDI VAN Provider provides mail box for send & receive
Sender Connects to VAN and sends its EDI
Sender then disconnects from the service
Recipient can connect to the network and receive those transactions from their mailbox
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VAN – Other Features Acknowledgements
To Sender (Messages have been sent successfully)
To Receiver (New EDI message has arrived in their mailbox)
Data Backup/Recovery,
Document Mapping
Audit trail of all EDI transactions
Tracking / Recording the trail of a message (on demand)
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VPN Public Telecommunications Networks (internet)
Private Data Communications
Intranet and extranet(VPN Server to another VPN Server)
Client/Server model
Clients -> authenticate, encryption, creating tunnels and managing sessions
Lower Costs compared to Leased Lines
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Web / Mobile Web
Users will use Web Browsers
Pre-populated Form
Security depends on the internet technologies (HTTPS and AS2)
Mobile
Recent development concentrates on mobiles
At Least to check the status of the transaction
Many Challenges (different screen size & different platforms)
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Protocols HTTP / HTTPS
POP3 / SMTP
SFTP
OFTP / OFTP2
WebDAV (Web folders or web share)
X.400
EDIINT
AS1
AS2
AS3
AS4
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Protocols – OFTP2 (ODETTE File Transfer Protocol)
• Message encryption and signatures support
• Signed receipts
• Message compression and integrity
• Session authentication
• Session encryption (TLS)
• File restart
• Push / pull operation
• Peer-to-peer or indirect communications
• File compression
•Operates over TCP/IP, X.25/ISDN, native X.25
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OFTP2 vs AS2
• OFTP2 – Push & Pull
• AS 2 - Push
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Transmission Directions Inbound
Outbound
EDI that tells a warehouse to perform an shipment
Outbound for Manufacturer
Inbound for Warehouse computer system
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Transmission Directions – Inbound Processing
P2P, VAN or AS* to EDI Application (Mail Bag)
Validation of Party
Authentication
Authorization
Valid message
Structure of the file vs EDI standards
Individual fields vs standads (ex. PO)
Create non EDI doc for back end ERP or database or queue
Conversion / Tranformation to properitry format (Ex: IDoc)
Can be done by Standard mappings (XSLT or Custom Mapping modules)
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Transmission Directions – Outbound Processing
Read data from DB (or) From back-end ERP (or) Queue
Validate message format & individual fields in the given file
Use Mapper and create EDI Message
Validate EDI Message
Send to Trading Partner
Audit Creation and Interpretation (Depends on the EDI type)
Technical Acks
Business Acks
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Transmission Directions - Inbound & Outbound
Source: http://www.vsiapparel.com/edi_inbound.htm
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Transmission Directions - Inbound & Outbound
Source: http://www.sysmaker.com/infopro/edi.htm
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Example Transactions Purchase Orders
Invoices
Shipping Notices
Export/Import Information
Carrier-to carrier waybills
Funds Transfers
Design Specifications
Health Insurance Claims
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Stats… 2008 Aberdeen report (POs)
34% - North America.
36% - EMEA
41% - APAC
Average paper requisition to order costs a company
$37.45 - North America
$42.90 - EMEA
$23.90 - APAC
EDI requisition to order costs are reduced to
$23.83 -> North America
$34.05 -> EMEA
$14.78 -> APAC
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EDI - Implementation Step 1 - Organize
Step 2 - Review
Step 3 - Develop
Step 4 - Integrate
Step 5 - Map
Step 6 - Pilot
Step 7 - Deploy
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EDI – Message Formats ANSI ASC X12
cXML
ebXML
UBL
Tradacoms
EDIFACT
RosettaNet
CIDX
PIDX
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CEFIC – Chemical
EANCOM – Retail
EDIBDB – Construction
EDIFICE – High Tech Industry
EDIFURN – Furniture
EDIGAS – Gas
EDILEKTRO - Electro
EDILIBE – Books
EDITEC - Sanitary
EDITEX – Fashion
EDI – Message Formats (Contd…)
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EDI – Message Formats (Contd…)
EDIFOR/EDITRANS - Transports & Logistics
EDIWHEEL - Wheels & Tyres
ETIS – Telecommunication
STAR - Standards for Technology in Automotive Retail
SPEC2000 - Airline Industry
FORTRAS - Transports & Logistics
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EDI – Sample Business Flow
Source: http://sap-idoc2edi-consulting.com/images/Blog24/GIS%20XI%20SAP%20Overview.jpg
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SAP NW PI – B2B Flow
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EDI – Challenges Customers
Committees
Solution Providers & Partners
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Referenceshttp://en.wikipedia.org/wiki/Electronic_data_interchange
http://www.edibasics.co.uk/
http://e.d.i.tripod.com/edi_history.htm
http://www.123edi.com/
http://www.electronic-cash-news.com/2010/concise-timeline-and-history-of-electronic-data-interchange-edi/
http://rogerclarke.com/EC/EDIIntro.html
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Referenceshttp://www.edimatrix.demon.co.uk/history.htm
http://archive.ifla.org/VI/5/reports/rep4/rep4.htm
http://www.covalentworks.com/what-is-edi.asp
http://en.wikipedia.org/wiki/OFTP
https://www.cybertext.com/books/primerprev/chapters/ch2.htm
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