Back when I was a young marketing manager, companies I spoke with that were looking to purchase ERP software would often describe business requirements that made no sense to me. (ok, it still happens today too). But now, as then, I know enough to nod my head, take good notes and then go ask the real ERP experts here at CAL Business Solutions.
Good think we have google (oops, I mean Bing)! One of the best explanations I found to describe EDI to non-technical folks like me is from a company called Softcare. They explain “EDI (Electronic Data Interchange) is simply the means to communicate between companies from one computer to another. For many years companies have been using computers to send business documents instead of mailing paper documents (i.e. most of our pay checks are directly deposited into our bank accounts). This transfer of funds is accomplished by the use of an electronic file being sent from your company to your bank. The problem was that all the efforts employed proprietary or unique formats. The absence of a standard format led to the condition where computers could no longer "talk" to one another without a great deal of effort by programmers. For example, Supplier X could recognize an electronic Purchase Order from Retailer A but not from Retailer B. In 1979 the American National Standards Institute (ANSI) formed the Accredited Standards Committee (ASC) X12 to rectify this situation. This committee was to standardize the format of electronic documents to allow for easy movement of information between computers.” Thus EDI was born!
In other words, you want to sell your widget to Walmart. But Walmart only speaks EDI language. So you better use an accounting/distribution software that speaks EDI too!
That makes it sound simple. Except that there are different EDI models that work best for certain scenarios. A new group called Amp’d (AMP'd is a strategic alliance of distribution software leaders that have united to provide an advanced platform for the Distribution industry partnered with Microsoft Dynamics GP) is offering a white paper for download called: Don't Pick the Wrong EDI Model. Itpromises to help you find out how your business can generate more perfect orders delivered to the right place, at the right time, and at the right price. And five key factors to determine which EDI model will meet your business needs.