Electronic Data Interchange (EDI) is the exchange of routine business transactions in a computer processible format, covering such traditional applications as inquiries, planning, purchasing, acknowledgements, pricing, order status, scheduling, test results, shipping and receiving, invoices, payments and financial reporting.  Additional standards cover interchange of data relating to security, administrative data, trading partner information, specifications, contracts, production data, and distribution and sales activities. 

Through the use of the Accredited Standards Committee (ASC) X12, electronic data interchange is based on interdependency.  This way, internally or externally developed software and public-access communications vendors, all sizes of firms and institutions using intelligent computational devices may benefit from the use of the standard.  Thereby, all institutions reap the efficiencies of a common interchange language, rather than experience the difficulties of an increase of methods and procedures that could occur if each institution were to impose its own format on every institution with which it does business.

What is EDI
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