A Brief History of EDI

EDI has been around for approximately 25 years. It has been adopted by 98% of the Fortune 500 companies because it streamlines almost all aspects of doing business. The big hold back for smaller companies has been complexity and cost. If you are getting interested in EDI, probably because you have grown big enough that it has become cost effective or one of your bigger EDI capable customers is telling you do EDI or lose their business. 

 

Current EDI Environment

Current industry analysis indicates that 98% of Fortune 500 companies use EDI for business transactions, and that most mandate that companies conducting business with them use EDI as the primary transaction mechanism. Estimates are that in the next two years EDI transaction volume will grow from $850 million, to over $2 billion. Additionally, the federal government (Health Insurance Portability and Accountability Act – which literally lists 12 EDI transactions) and many state governments (Ohio’s Bureau of Workers Compensation and California’s EDIINT initiative) are targeting EDI as a mechanism to lower costs and become more efficient.

 

Vendor Managed Inventory (VMI)

Another aspect of EDI is Vendor Managed Inventory (VMI). VMI is the next step in just in time inventory management.  The customer sends EDI transactions that indicate inventory levels.  This is used to automatically restock the customer.  A second EDI transaction is sent to notify the customer of what is to be sent. An advanced ship notice is then used to indicate when the delivery will be made. VMI can totally automate the re-order process. 

EDI's Benefits

EDI brings substantial savings and benefits to organizations which implement it. Effective use of EDI:

Mapping

An EDI implementation starts with a mapping function.  EDI transactions are mapped to your internal database file formats for inbound documents.  Internal application file formats are mapped to an EDI transaction in outbound mapping.  These EDI transactions are exchanged with your trading partners.

ANSI EDI Standards

The ANSI EDI standards are made up of over 300 transactions.  The following is a list of the more common EDI transactions with which Jigsaw Solutions, Ltd. consultants have extensive experience.  Please contact us either via e-mail or our office (614)771-1313 if you have any questions about specific transactions:

148 - Report of Injury, Illness, or Injury

210 - Freight Details and Invoice

214 - Transportation Carrier Shipment Status Message

278 - Health Care Services Review Information

816 - Organizational Relationships

820 - Payment Order/Remittance Advice

823 - Lock box

824 - Application Advice

835 - Health Care Claim Payment/Advice

837 - Health Care Claim

850 - Purchase Order

852 - Product Activity Data

855 - Purchase Order Acknowledgement

856 - Ship Notice/Manifest

864 - Text Message

867 - Product Transfer and Resale Report

987 - Functional Acknowledgment

996 - File Transfer

997 - Functional Acknowledgment

 


 

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