Electronic Data Interchange (EDI) is an enabling technology applied to a strategic re-engineering effort. Creative use of the EDI effectively reduces non-value-added costs, increases the availability of working capital and improves the quality of the data as well as the business processes. This article focuses on evolution, benefits and various applications of the EDI.

Electronic Data Interchange (EDI) is no more a buzzword, but a byword in many of the industrial segments. Since the early 1980s, proponents of the technology touted it as a simple-to-install way to exchange data between the organizations. Time and practice have not borne out these early predictions. It is indeed an easy to install technology, but does not address a technical problem; rather it addresses a business process problem. Industrial segments realizing meaningful returns from the EDI investments have achieved results by applying the technology to the strategy, mission and goals of their constituent businesses.

Today, the landscape of the US industry is littered with EDI programs, which began with optimism but were stalled due to unexpected issues. While the technology of EDI does not qualify as `rocket science', but the practice of it involves a surprising array of variables, which have to be anticipated and managed. To implement successfully, EDI must be viewed as an overall integrates solution to the organizational requirements.

Mere transfer of data from one point to other is not sufficient. The EDI improves the efficiency by integrating the transferred data within the business application for which the data is intended. EDI often becomes a change driver for an organization, which adopts it at the behest of an insistent trading partner. Conversely, EDI can be an enabling technology when applied to a strategic re-engineering effort.

E-Business Magazine, E-Commerce, Electronic Data Interchange, EDI, Strategic Re-engineering Process, Working Capital, Industrial segments, Computer Process, Magnetic Tapes,Transportation Data Coordinating Committee, TDCC, Business Communication, Value Added Network, Business Environment, Electronics Industry Data Exchange, Supply Chain Management.