Electronic Data Interchange (EDI) Software

These products usually help transfer important business files from one computer system to another. Global business partners often use electronic data interchange software to exchange business documents electronically. This saves time and costs of file transfer and helps eliminate costly human errors. You’ll also find products specially designed to ensure seamless integration between suppliers and manufacturers.  Read the full software guide...

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What is Electronic Data Interchange (EDI) Software?

Electronic Data Interchange, or EDI, is a software-delivered process that allows the exchange of data between two or more computers. Businesses and companies use this software to ensure faster document transactions in the workplace and among or with their suppliers, clients, and partners.

Aside from the abovementioned function, EDI software is heavily utilized as a communication tool for businesses and organizations in the healthcare and production industries.

It is also commonly used for standardizing the way businesses work with invoices and purchase orders. This is because implementing an EDI software solution helps simplify the communication process of sharing such information.

Therefore, information, documents, and communications are electronically transmitted, thereby eliminating the need for tons of paperwork, paper trails, and time-consuming tasks like mailing (postal and email) and faxing. So, instead of the usual three to five days-long exchange of documents for a purchase order, EDI software cuts it down to several hours (at maximum).

EDI solutions translate files so that they follow a standard or unified format and are transferred and understood easily. Additionally, how and where the information or data is sent or transmitted depends on certain rules or standards. So, there is a process for sending the data and there is another one for receiving it.

Although EDI is not easy to implement, it becomes easier when businesses work with a consultant or tech specialist trained in the said field. As such, most companies use their IT department for the successful implementation and management of EDI in the workplace.

Types of Electronic Data Interchange Software

Primarily, there are two major characteristics of EDI software solutions. First, it must offer a secure channel for data exchange between computers or a network of computers. Second, it should have tools that are essential for automating and optimizing the transfer of data.

When it comes to EDI types, however, the focus should be on which one suits the specific needs of your business, along with the software’s capabilities. There are several options to choose from.

Point-to-Point or Direct EDI has been around for years and is used by quite a lot of companies. This EDI type allows you to communicate and connect with your partner/the other party directly. A secure line, a single one, is established via the internet that has the same communication protocol or process. Companies that prefer this type often deal with heavy EDI document traffic.

Direct EDI needs software that allows the use of practically all protocols, particularly FTPS, SFTP, and AS2.

EDI via AS2 allows and ensures secure transmission of data over the internet. This is made possible by AS2, considered one of the most popular options for data transport. This EDI connects the client and server computers to each other—point-to-point—through the help of the web. The data is sealed in an envelope to make sure it is safe.

EDI via AS2 is commonly used in by retail businesses.

EDI via VAN (Value Added Networks) allows for the exchange of electronic documents between business partners. These are private networks that use mailboxes to transmit the data. It works just like the common mailbox—a business sends documents via a mailbox and the receiving company or organization retrieves the documents via the mailbox.

One of the features users like about this EDI type is its notification function. Every time a message is successfully sent, the sender is notified. At the same time, the recipient is also notified that a new message has just arrived.

Web EDI makes use of the typical internet browser in transmitting EDI data or communication. Used mostly by small and medium-sized businesses, as well as companies that rarely deal with EDI traffic, it works like a web-based form of the paper-format document. As such, users need to fill up a form with the information or data they want to transmit and this is then converted into EDI format before being sent through an internet protocol such as AS2, HTTPS (Hyper Text Transport Protocol Secure), and FTPS (File Transfer Protocol Secure).

Mobile EDI is slowly becoming a popular option, especially considering today’s highly active mobile generation. Even if the design and concept of EDI applications were not created for mobile users, there are now quite a number of Mobile EDI software solutions being developed. There might not be a lot of EDI-related apps yet, but there are already individuals and businesses in the retail sector that are adopting the concept into their day-to-day processes.

EDI Outsourcing or Managed Services involves a third-party provider that helps in the management and implementation of a company’s EDI process. It works the same way outsourced IT services work, which means productivity, agility, and value-added services at a much lesser cost.

Knowing which of these types of EDI software solutions is beneficial for your specific business or organization will help in ensuring proper EDI implementation and management.

How to Choose Electronic Data Interchange Software

Aside from knowing which EDI software characteristics perfectly suit your business, choosing the right one also means understanding the most essential features and capabilities you need to look out for.

The first thing you need to do, before anything else, is to determine the volume of EDI transactions your business has on a monthly basis. As such, you need to specifically know the number of EDI documents that are being sent to and received by your trading partners every month.

If the transaction volume is low (500 or less), you should consider getting a web-based EDI solution or one categorized as entry-level.

It is also important to gauge the EDI knowledge and experience of your team. If the team is quite new to the EDI concept, you might want to go for the simplest EDI software solution. Likewise, if you choose a third-party provider, they will be able to determine the ideal solution for your business if you provide the right information about your EDI team’s knowledge and experience level. Most providers offer demonstration and training tailored accordingly to your team’s skills level.

If you want to integrate EDI software with your company’s back-end system, you need to work with a provider or vendor that offers integration functionality for EDI data. This means that you’ll work with a package that combines EDI software with a WMS (warehouse management system) solution and an ERP (enterprise resource planning) solution, among others.

You will also want to go with an EDI software solution that allows you to connect and communicate with businesses in various parts of the world. This means that the EDI solution should be capable of handling different formats of data, communication protocols, and varied types of documents.

Benefits of Electronic Data Interchange Software

Electronic data interchange software solutions help businesses and organizations to improve a lot of things. In general, they help streamline the day-to-day operative processes, making it possible for companies to enjoy improved efficiency, increased productivity, and lesser operational costs.

EDI software streamlines business processes by eliminating the need to use traditional communication means like mailing and faxing. As such, the manual process is automated. This results in shorter periods of processing and delivery. Therefore, as business personnel spend lesser time doing manual tasks, more time can be allotted to other essential responsibilities and objectives.

Automated transactions also mean a reduction in the use of paper, printing materials, and equipment and storage needs. Consequently, transaction costs are significantly lessened. Aside from expenses, there is also a reduction in or an elimination of the number of human errors. As such, EDI is essential for businesses that want to improve accuracy and generate an improved performance.

All these factors will result in better customer service, which can help establish good customer relations while also enabling better branding and an increase in profitability.

Finally, EDI software solutions help businesses to improve the flow of information. Businesses that recognize the importance of building and strengthening relationships with partners and clients know that implementing and managing good EDI software is essential for overall company development and growth.

Common Features of Electronic Data Interchange (EDI)

API Application Programming Interfaces (APIs) are programmatic intersections with external products or platforms that allow for custom integrations with your own solutions or other solutions you are using.
Batch Permissions & Access Control user or group access and permission settings for software or other systems.
Data Export Exporting functionality can be used to streamline the migration of data sets and information across systems, platforms or applications.
Data Import Importing functionality allows you to use data sets from other systems or platforms to cut down on data entry requirements or to more easily migrate records from similar applications you have used in the past.
External Integrations Integrations with other software products or platforms to improve efficiency and compatibility across systems.
Multi-User Supports more than just one user account and generally allows for collaboration with colleagues.
Notifications Includes notification support and sends you alerts with information on important events and other time sensitive instances. For example through push notifications on mobile phones or email notifications.
Password & Access Management Manage passwords or access to systems for yourself or your organisation.

Latest User Reviews of Electronic Data Interchange (EDI) Products

Ivan Vanhaecht
24 Jul 2017
"Integration in Arco edocuments platform"

We could select the EDI features we needed to complement our E-documents and e-archiving platform. We could do this in self service...

Bart Deman
14 Sep 2017
"Electronic data intechange made easy"

The first I liked was the easy to use graphical interface. It makes complex mappings look easy. A full comprehension of all the tech...

InterWeave Smart Solutions
Jane Gyorgy
19 Mar 2019
"Best Ever!"

It WORKS!!! Their integration is flawless, worked from the start (June 2007) and whatever I asked to have added, they have been able...

Bavly Gerges
14 Jun 2020
"Very easy and smooth in use "

Great software with easy features and smooth in operations , for many reason I would like to recommend this software as it is great ...

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