What is the Full form of EDI?

The full form of EDI is the Electronic Data Interchange. EDI is the computer to computer transfer of business documents among the business partners in a standard electronic format. By switching from a paper-based transfer of business documents to an electronic one, companies realize significant advantages such as reduced expense, improved processing speed, decreased mistakes, and enhanced business partners relations.

Many business documents can be exchanged using EDI, but the two most popular are sales orders and invoices. EDI removes the sorting and handling of mail which is synonymous with traditional business communication. EDI’s main power is to standardize the information shared in business records, allowing for a paper-free exchange.

History of EDI

• EDI was influenced by advances in military logistics, as are many other early information technologies.
• The difficulty of the Berlin airlift in 1948 includes the construction of approaches and practices for sharing vast amounts of data and details about transported products, often over a 300-baud teletype modem.
• Such initial ideas later formed the US’s first TDCC (Transportation Data Coordinating Committee) standards. Freight Control Systems was one of the first integrated systems that used EDI.
• In 1971, one of those realtime systems was the LACES (London Airport Cargo EDP Scheme) at Heathrow Airport, London, UK.
• Implementing the DTI (Direct Trader Input) process, it enabled forwarding agents to directly enter data into the customs processing system, reducing duration.
• Increasing maritime traffic and customs-like issues similar to those faced at Heathrow Airport contributed in the 1980s to the introduction of DTI systems in single ports or ports groups.

Advantages of EDI

• Instead of weeks or days, the information and data are exchanged in just secs.
• It removes time-consuming tasks like printing, storing, filing, and paper delivery.
• In EDI, human interference is that which decreases human errors like messy handwriting, mishandling of documents etc.
• It helps businesses save money by eliminating the costs related to developing and supplying papers.
• EDI helps to maintain client relationships by enabling companies to adapt more quickly to modifying customer needs.
• Data is communicated in realtime, allowing for quicker and better decision-making.