Electronic Data Interchange (EDI) can be defined as the exchange by computer of business documents in a standardized format. EDI has been in use for over twenty years, although it began making inroads in the general business community much more recently. For example, electric utilities including nuclear generating facilities are now using EDI for its purchasing, materials management and invoicing requirements.

EDI is one of the many tools available for streamlining your business processes. EDI allows you to shorten procurement cycles, reduce administrative costs, automate blanket order releases and maintain control of your network of vendors. As a result, your procurement organization can focus on value added activities, rather than on time consuming tasks.

DATA CONVERSION

EDI uses software to convert data into a standardized format. This software can be based on a personal computer (PC) or mainframe. Many firms choose to start with a PC-based system to minimize implementation cost. Although mainframe EDI systems carry higher initial implementation costs, they offer more features that the PC-based systems. For example, most mainframe systems supply a “Mapper” application. Before EDI software can process data, the data must be mapped into the standardized EDI format. The “Mapper” assists in the formatting of data into this standardized EDI format.