how e business works

1. Prestige Institute Of Management & Research
Presentation On-
Inter-Organization Management: EDI Application in
Business, Standardization and EDI, EDI Software Implementation.
Guided By:-
Prof. Rajeev Bhatnagar
Submitted By:-
Aakash Gupta
Ankur Thakur
Sajal Jain
Sangam Nagar

2. An inter-organization management is one which allows the flow of
information to be automated between organizations in order to
reach a desired supply chain management system, which enables
the development of competitive organizations.
This type of management system helps in better management of
the buyer-supplier relationships by implying the full depths of
tasks associated with business processes company-wide. In doing
these activities, an organization is able to increase the productivity
automatically; therefore, optimizing communication within all
levels of an organization as well as between the organization and
the supplier. For example,
each t-shirt that is sold in a retail store is automatically
communicated to the supplier who will, ship more t-shirts to the
retailer of the similar kind.
Inter-Organization Management

3. Electronic Data Interchange (EDI)
Electronic data interchange (EDI) is a method for transferring data
between different computer systems or computer networks. It is
commonly used by big companies for e-commerce purposes, such
as sending orders to warehouses or tracking their order. It is more
than mere e-mail; for instance, organizations might replace bills of
landing and bills of payment with appropriate EDI messages. It
also refers specifically to a family of standards.
The National Institute of Standards and Technology defined EDI as
“the computer-to-computer interchange of strictly formatted
messages that represent documents other than monetary
instruments. EDI implies a sequence of messages between two
parties, either of whom may serve as originator or recipient.”

4. Uses of EDI
•Manufacturing
•Shipping
•Warehousing
•Pharmaceuticals
•Construction
•Petroleum
•Banking
•Insurance
•Health Care Sector
EDI was first used in the transportation industry more than
twenty years ago by air and rail carriers, shippers and freight
forwarders.
EDI is mainly used in:-

5. EDI Application in Business
EDI is a standard used for all business documents, like Purchase
Orders, Ship Notice, Ship Manifest, Invoices and Freight Bills. EDI
standards are used by companies that wants to conform to standard
way of transacting business documents.
Exchanging business documents via EDI is a fairly simple concept.
Outbound data is formatted according to a set of standards and
transmitted electronically. Inbound data may be converted back to a
format internal systems can understand and integrated directly into
ERP, accounting or other back-end business applications.
Cutting costs, enhancing trading partner relationships, streamlining
operation. All of these improvements are the goals of virtually every
business. That’s why so many industries have adopted the use of EDI
as a standard business practice.

6. Different businesses have different requirements for EDI, and a may have
different practices in how EDI is implemented. These may include:
Business practices – different industries often take different approaches to
doing business, with different issues that must be addressed. All must be
accommodated with EDI.
Data – every industry uses different forms and other documents that have to
be adapted to EDI documents.
Standards – different parts of the world may use ANSI X12 standards vs.
EDIFACT, and different industries may have a specific sub-set of the
standards, such as HIPAA 5010 for healthcare.
Communications – different industries have adopted different protocols for
communicating via EDI, whether it’s HTTP, FTP, AS2, or another approach.
Formats – EDI can include many formats for documents, which can vary from
industry to industry, including traditional EDI, XML, CSV, fixed length, and
others.
EDI practices – how organizations work together using EDI can differ in each
industry, such as the practice of charging penalties for non-compliance of
requirements in retail.

7. Standardization and EDI
EDI provides a technical basis for commercial "conversations" between
two entities, either internal or external. EDI standards describe a specific
format of electronic documents.
The EDI standards were designed by the implementers, initially in the
Automotive industry, to be independent of communication and
software technologies. EDI can be transmitted using any methodology
agreed to by the sender and recipient)
The main motive and reason behind the standardization in EDI was to
avoid miscommunication and confusion between the sender and
recipient. The growing popularity of EDI brought with itself many
problems and confusions and standardizing the EDI was the solution to
these problems

8. The UN-recommended UN/EDIFACT is the only international standard
and is predominant outside of North America.
The US standard ANSI ASC X12 (X12) is predominant in North America.
The TRADACOMS standard developed by the ANA (Article Numbering
Association now known asGS1) is predominant in the UK retail industry.
The ODETTE standard used within the European automotive industry.
The GS1 standard in most popular in Indian organizations.
Some major sets of EDI standards are:

9. EDI software implementation is of course a process that is conducted by
experts and mostly by the professionals who provide such software. This
is a technology that proves to be of benefit to two partner organizations
that are usually trading partners.
The only requirement is that the implementation of the software needs
to be done properly. EDI software implementation cannot take place
without proper commitment as well as leadership from the top
management.
Again, the aid of experienced consultants is crucial for smooth
implementation and working of such a system.
EDI Software Implementation

10. The EDI software implementation is a process which is detail oriented.
There is a lot of collaboration involved and one also needs to go through
many testing phases along with partners who trade with one and with
whom such data interchange will take place. The advantage of such
systems is that, once the implementation is done properly, there is a
rare possibility of such a system breaking down. There are many
consulting groups who are experts in this field. They will provide
valuable consulting services through which clients can decide which
software would suit their needs the most.
The benefits of EDI software implementation which is done properly are
many. The errors are reduced and that means fewer chargeback fines to
pay. There is also considerable efficiency built up since the one does not
have to waste time fixing problems. The processing steps are
streamlined and hence that leads to operation costs considerably
lowered, training happens faster and compliance management is also
taken care of.
Edi Software Implementation – What It Involves

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