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ELECTRONIC DATA INTERCHANGE

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Introduction

1.0 WHAT IS ELECTRONIC DATA INTERCHANGE (EDI)? Australia's largest retailer has approached us, to submit a proposal on Electronic Data Interchange (EDI); what it is, how it would be implemented in their company, the benefits of implementing EDI, the internal restructuring of the company, the technologies involved, and the analysis of the derivatives of EDI. The resulting study reports that the potential benefits within the retail industry are high. 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'. EDI is the transfer of data between different companies using networks, such as the Internet. As more and more companies get connected to the Internet, EDI is becoming increasingly important as an easy mechanism for companies to buy, sell, and trade information. EDI allows new ways of carrying out tasks, as well as making provisions for new ways of working. Companies may wish to restructure in order to adopt and take full advantage of the new and more effective methods of operation that EDI enables. These organizational impacts may include workforce reductions and eliminating of certain tasks. 2.0 HOW EDI WOULD BE IMPLEMENTED? Implementing EDI in your business will require broad participation. A number of preliminary steps need to be taken in order to implement EDI including; exploring the EDI, as well as deciding the direction the company wants to take the EDI to. The impact on business practice will be extensive. It will affect most, if not all areas of the company, including the existing computer system in place as well as current working procedures. Some procedures may be eliminated altogether due to the move towards paperless environment. Implementing decisions will need to be taken, covering: a) Business Needs Analysis Analyze your business needs to correctly identify areas of your business where EDI will return the most benefit. ...read more.

Middle

Not only will the 'turnover rate' of each individual task speed up, it will also enhance the quality control within it. 4.0 THE INTERNAL RESTRUCTORING OF THE COMPANY Once the commitment is established to moved ahead with the implementation of EDI. The following listing will provide an approximate idea of how to approach such planning: * Nominate EDI project champion * Form EDI project team * Analyse and prioritise internal and external information flows * Analyse manual/automated generation of information * Identify key trading partners in terms of order quantity, value, etc * Identify and exploit EDI information sources - awareness centers - trade associations - EDI software vendors and network operators - EDI consultants - EDI users * Assess costs of implementation * Plan pilot implementation based on all of the above * Agree pilot with selected trading partner(s) * Assess and agree requirements for software, communications and standards * Run pilot and subsequently evaluate outcome * Progress implementation to new business partners and new business functions EDI should be implemented in a similar methodology as with any other business strategy, that is in a piecemeal approach proving and evaluating each stage before progressing to the next. It is not advisable to convert to a fully functioning EDI overnight as that will disrupt the relevant processes. It takes time for employees, systems and process to adapt to the new technology. (http://www.edi-gym.freeserve.co.uk/) Human Resources The retraining of existing employees in the use of the EDI machinery. Furthermore, the employment of additional workers to complement the implementation of EDI. The accounts department as well as the purchasing department will be heavily involved in the implementation of EDI. Their computing knowledge will be expanded in the use of new software a well as the EDI format standards that accompanies it. Their processes will be very different however in principle it will be similar. As mentioned above, there will be the need to be have specialist available to maintain the EDI architecture and especially the system processes. ...read more.

Conclusion

Object-oriented EDI (OO/EDI) Object-oriented EDI is the application of object-oriented techniques to EDI. It adopts Open EDI. OO/EDI strongly uses business process and information modelling methodologies to design its objects. The resultant model specifies the business flow needs and identifies related object classes to the extent that production of off-the-shelf software to support EDI exchanges becomes feasible. It is not possible to convert existing EDI messages into OO/EDI(FACT) and OO/EDI will not use the EDI syntax. OO/EDI is still under development. (http://www.telin.nl/NetworkedBusiness/) 6.0 THE DERIVITATIVES OF EDI The future of EDI would be more compliant and uniformed if the same standard was applied globally. That is, where all the nations were to implement the same standard format/software everywhere. Then EDI can be really implemented across the world. At the moment, there are several standards or syntax upon which EDI massages are built (www.edi-gym.freeserve.co.uk, 2.09.01). There are three syntaxes that are the main player in the EDI arena - ANSI X.12, UNTDI2 and EDIFACT3. The former is the main standard used in North America as well as Australia and New Zealand. UNTDI was the main standard in Western Europe until EDIFACT became the only international syntax standard (www.edi-gym.freeserve.co.uk, 2.09.01). 'Traditional' EDI will still exist now and in the near future and will most likely continue to proliferate. New and innovative uses of EDI technology such as OBI (Open Buying on the Internet that is a combination of Web-based and traditional EDI technologies. Its intended use was for high volume, low-dollar purchasing) will continue to emerge. In terms of data exchange between enterprises, things will probably get worse before they get better. With the variations in existence on technology, the complexity will only increase. Nevertheless, as the confusion in technology outlook may be, the original concern of facilitating the business of commerce, it is most likely that we will see further improvement. Some of these technologies may not find much practical use nor the marketplace will tolerate inefficiency for long. Even with their diversity, these technologies will extend electronic commerce to new businesses and applications. In the end, commerce will be served (Rawlins, 11.09.01). 7. ...read more.

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