Electronic Data Interchange (EDI) is exactly what it sounds like, the interchanging of electronic data. So, HTTP is an EDI protocol, as is the POP3/IMAP that is used in email. This post isn’t about any old EDI solutions, however, but is about specifically commercial applications for the technology, and why you might want a custom solution to the EDI problem.

With the explosion of cloud computing, a whole new realm of possibilities is now available to companies. The interaction between the employees becomes faster, as they can work on the same project at the same time and interact in real time.

This allows companies to offer faster services to their customers and expedite their B2B relationships. You can share calendars, make live changes to spreadsheets and documents that other people can see in real time and can react to while being on the other side of the world.

Cloud computing can also contribute towards reaching the oft-cited goal of a paperless office, as all documents can be stored in one virtual area that people can access at any time from anywhere, and due to the high interactivity and how easy it is to make changes online, the paper and the pen can be put to rest.

But the world of data management isn’t confined to cloud storage. If you can store documents on a server which can be accessed by multiple people, why not also create a way to communicate within a company or several companies, allowing businesses to transmit things such as shipping orders, invoices and so on?

This is when Electronic Data Interchange Solutions come into play.

Invoices can be easily lost in the mail. Printed orders need to be manually entered into whatever computerised archive system the receiving company uses, and mistakes can be made very easily during that process.

EDI is essentially a way to set a standard between two entities so that documents are shared electronically and are ‘understood’ by both sender and recipient. EDI software tries to bridge the gap between companies (or different departments within the same company) so that when, someone sends an invoice, for example, the company/individual can receive the document, view it, understand it and keep a record without any issues arising.

If you don’t have these systems in place, you will be swamped by the rivers of bureaucracy, where trying to find even a single invoice will become a huge waste of time because you will need to weed through years and years of binders and folders to find what you want. Multiply that by the number of vendors that might send you invoices or clients that might send you shipping orders … you get the idea.

Since the data and documents are handled by computers rather than humans, you need to set up a standard between the sender and the receiver, and that’s where EDI software comes into play.

EDI: Essential For e-Commerce

An incorrectly managed EDI system, or the complete lack of one, will slow down your e-commerce business. I can’t remember last time I went to a shop to buy something that wasn’t food or clothes. And even then, I often order through the internet. And I know that if I have to start sending faxes or do something more than just clicking a few times I will abandon the web site and find someone that will get me what I want faster.

This internet buyer culture is growing every day, and with mobile devices becoming more powerful, you need to give clients the ability to order on-the-go, without even needing to set foot into a shop.

From a B2C point of view, data management done right means that whenever a costumer books a restaurant with his mobile phone for the evening while strolling around London, that booking will automatically go into an existing calendar at the receiving end (the restaurant’s EDI system) without much human interaction until the customer actually steps into the restaurant.

From a B2B standpoint, data management means that orders for supplies from Such and Such Company will be automatically archived under the name of that company, together with shipping deadline, amount of supplies and information of where they are supposed to go, so that the next human interaction needed is the actual act of packaging the order. The label doesn’t even need to be hand written because the EDI system will have that information and you can just print it out.

Custom electronic data interchange solutions mean that the control over your data is placed back into your hands, rather than trying to work around protocols built for general-purpose use.

Essentially with proper data management through EDI software you can manage all of this data without fax, postal mail and even emails.

Without EDI, your business will be slow to respond by today’s standards and you will lose customers, whether they be other businesses or consumers.