E-commerce glossary

Free ecommerce glossary that has explanations for the EDI terms and acronyms you may encounter as you automate EDI and XML ecommerce processes.

The Internet and eBusiness have created an entirely new vocabulary. This glossary has common words and definitions such as an electronic data interchange definition. Below are basic definitions for the frequently-used EDI terms:

A-D


    ACH, Automated Clearing House: the U.S. Provides for the electronic distribution and settlement of bank accounts between financial institutions in the United States.

    856 Advance Shipping Notice, An EDI 856 Advance Shipping Notice is an electronic version of a printed packing slip that tells a buyer how a supplier has packed their items for shipment. Most ASNs will follow either standard pack or pick and pack guidelines. Usually the buyer will specify how they want the goods packed. The Advance Ship Notice, or ASN, also tells the buyer that the goods have been shipped so they can be expecting the shipment.

    AIAG: Automotive Industry Action Group, Sets EDI standards for the automotive industry

    ANSI - American National Standards Institute, The coordinating group for national standards in the United States. The U.S. voluntary standards system consists of a large number of standards developers that write and maintain one or more national standards.).

    Application Programming Interface(API), An interface that programs use to communicate with other programs

    Application Control Structure (X12.6), This is the architecture that governs EDI standards in the United States. Contains the format definitions for terms related to electronic data interchange. X12.6 is downward compatible, and the current edition may be used with any older version of the standards.

    Application Service Provider (ASP), A company that offers monthly services for applications and related services on a pay-as-you-go basis. ASPs host, manage and maintain applications in their data center and make them available via the Web. Provides the latest information technology at a predictable cost.

    ASC X12, Accredited Standards Committee, X12 was chartered by ANSI in 1979 to develop uniform standards for inter-industry exchange of business transactions - electronic data interchange (EDI) standards. The X12 standards establish a common, uniform business language to allow computers to communicate with one another.

    ASN (Advance Ship Notice) , An XML or EDI standard transaction set sent by a vendor to a customer that specifies the content of a shipment and when it is estimated time to arrive.

    B2B, Business-to-business (B2B) electronic commerce - B2B systems exchange business documents, such as purchase orders and invoices, between pairs of partners in a supply chain. B2B systems also automate the purchase of goods that support business' maintenance, repair and operation (MRO).

    B2C, Business-to-consumer (B2C) electronic commerce; a marketing relationship between end consumers and businesses on the Web.

    B2G, Business-to-government (B2G) electronic commerce; transactions conducted between businesses and the government on the Web.

    Bar Coding, Encoding information using a series of black and white stripes. Bar codes are based on a series of parallel black bars and white spaces. New technologies include so-called "two-dimensional" bar codes that can store much more information than traditional one-dimensional bar codes.

    Benchmarking, Formal process of evaluating a company's performance by comparison with its peers and competitors in the industry.

    Benchmarking Gap, Difference in performance of an organization's particular activity or product, and that of their competition.

    Best Practice, Practices that have been shown to produce the best results for a particular process or activity.

    Bill of Lading, A document that is used by a vendor and a freight carrier that describes the freight classification of the goods being shipped by the vendor.

    Bisynchronous communication, An electronic method of communication in which data is sent in blocks of characters and in both directions at the same time.

    Bluetooth, A standard for wireless data transfer Bluetooth can be built into any wireless application. Bluetooth transmits at 2.45 GHz.

    Bps, Bits Per Second - a measurement of how fast data is transmitted.

    Broadband Web, High-speed broadband connections from businesses to the World Wide Web (internet).

    Browser, A PC tool for viewing HTML documents; used to retrieve, display, and print information from the World Wide Web using the HTTP protocol.

    Business Process, A series of business steps by a person or system that are started by a business event. (e.g. ordering process, shipping process, invoicing process).

    Catalog Buying, Provides customers with the ability to place and pay for orders online at the supplier's web site.

    Catalog Search, Provides customers with online accesses to a supplier's catalog.

    Catalog Syndication, The process for sending a Supplier's catalog is sent to customer. Possible uses of catalog information by customers include loading into purchasing or requisition software to facilitate ordering.

    Certificate Authority, A trusted company that will accept a public key, along with some proof of identity, and serve as a repository of digital certificates.

    Certification Authority (CA), A secure third-party organization that can vouch for the identity and origin of a person or program component.

    Certified Delivery Server, A server that uses public key encryption to validate a destination and provides a non-repudiation service. The server establishes that a message was received.

    CDMA (Code Division Multiple Access), A digital cell phone transmission technology based on assigning users unique sequence codes within a frequency range.

    Channel, The path used by a message; a means of transportation connects a sender and receiver.

    Charge Back, A penalty, for an agreed upon amount, assessed by retail customer to a supplier for not following vendor procedures established in the contract with the retailer.

    CIDX, Chemical Industry Data Exchange: sets standard for EDI and XML transactions in the chemical industry.

    Circuit Switching, Method of routing messages in which the communication channel is kept open until the message is complete (like the telephone).

    Clearinghouse, An organization that provides a message/file collection, routing and distribution service on behalf of other organizations. See also automated clearinghouse (ACH), Value Added Network (VAN).

    Common Business Library, Also called xCBL. A set of XML data tag definitions and schema language framework. Originated by CommerceOne.

    COM Object, A COM Object is a Component Object Model. Microsoft has migrated COM into DCOM. COM is used to support objects sent/distributed across a computer network. COM facilitates communication between ObjectBroker and OLE.

    Compliance Checking, A checking process that is used to ensure that a transmission complies with the syntax rules.

    Compression, Reduction of the size of computer files and records; saves storage space and increases the speed with which the file can travel over the Internet or across networks. EDI records are much more compressed in their original state than XML records by a factor of approximately 10.

    Content Management, The process of managing content to keep it current. For example adding new items to the online catalog. Also refers to a supplier's web site's ability to display information that varies by customer, for example customer specific pricing.

    Content, The information on a web site. Supplier web site content typically consists of relatively static catalog information and company information and constantly changing information that is customer specific such as order status.

    Counterfeit Access Device and Computer Fraud and Abuse Act of 1984, This act makes it a federal crime to knowingly access a computer in order to obtain financial records of financial institutions, consumer credit reports of consumer reporting agencies, and restricted federal government information. It is also a crime to use counterfeit or unauthorized access devices to transfer funds, obtain things of value, or to traffic these devices.

    Cryptographic Algorithm, A set of rules specifying the procedure required for the encryption and decryption of data.

    Data Communication, The transfer of data between two or more computers.

    Data Element, The basic unit of information in the EDI standards containing a set of values that represent a singular fact. It may be single-character codes, literal descriptions, or numeric values. For every piece of information a paper document, there is a corresponding data element in the electronic document or transaction set.

    Data Element Dictionary (X12.3), Defines the data that are used to construct the transaction sets. These must be used in the same version/release level as the transaction sets.

    Data Element Length, The range, minimum to maximum, of the number of character positions available to represent the value of a data element. A data element may be of variable length and range from minimum to maximum, or it may be of fixed length in which the minimum is equal to the maximum.

    Data Element Reference Number, Number assigned to each data element as a unique identifier.

    Data Element Requirement Designator, A code defining the need for a data element value to appear in the segment if the segment is transmitted. The X12 codes are mandatory (M), optional (O), or conditional (C).

    Data Element Separator, A unique character preceding each data element that is used to delimit data elements within a segment. "*" is often used as the delimiter.

    Data Element Type, A data element may be one of six types: numeric, decimal, identifier, string, date, or time.

    Data Encryption Key (DEK), Used for the encryption of message text and for the computation of message integrity checks (signatures).

    Data Rate, The speed at which data is transmitted and received. Usually measured in bits per second (bps).

    Data Segment, A data segment is an intermediate unit of information in an EDI transaction. It consists of a clearly defined sequence of functionally related data elements.

    Data Transfer, The amount of digital data that is moved from one place to another at a given time. Data transfer includes outbound traffic from a Website, with the exception of e-mail.

    Dedicated Line, A permanent connection to the Internet using an individual phone line.

    Delimiters, A delimeter is a punctuation character or group of characters that separates two names or two pieces of data, or marks the beginning or end of a programming construct.

    Dial-up Connection, A connection made over an ordinary telephone line between a computer (via its modem)

    Digital Certificate, An electronic document, issued by a certificate authority, used to establish a company's identity by verifying its public key; are used in much the same way as conventional forms of identification - such as a driver's license or passport - to provide irrefutable evidence of the owner's identity and, in some cases, authority in a given transaction. Digital Certificates are issued, managed, and verified by Certificate Authorities.

    Digital Signature, Digital signatures, like written signatures, are a method of authenticating the source of a document and/or its author. A common form of digital signatures are digital certificates, whereby the issuing company vouches for you and gives you a unique identification that can be verified by a merchant prior to accepting an order.

    Direct Connection, A permanent connection between a computer and the World Wide Web (Internet).

    Direct Goods, Raw materials and components that become part of a finished product.

    Direct Transmission, The exchange of data one sending computer to another receiving computer.

    DISA, Nonprofit organization supporting the development of e-business standards in e-commerce.

    DISA (Defense Information Systems Agency), An agency within the United States Department of Defense that is responsible for the Defense Information Structure (DII).

    DNS, Domain Name System is a system of servers located on the Internet that have been set up for Internet connections and the routing of e-mail.

    Domain Name Service (DNS), Domain name service allows a more friendly way to remember places on the Internet. DNS is what maps IP numbers to domain names across the Internet.

    DSL, Digital subscriber line; a technology for bringing high-bandwidth information to homes and small businesses over ordinary copper telephone lines.

    D-U-N-S Number, A database maintained by Dun and Bradstreet that is used to identify companies to each other and to the U.S. government. The nine-digit DUNS identification sequence, developed and assigned by Dun & Bradstreet, Inc is an internationally recognized common company identifier in EDI and global electronic commerce transactions.

    Dynamic HTML, HTML extensions that enable a web page to react to user input without sending requests to the web server.

    Dynamic Packet Filter, A firewall facility that can monitor the state of active connections and use this information to determine which network packets to allow through the firewall. By recording session information such as IP addresses and port numbers, a dynamic packet filter can implement a much tighter security posture than a static packet filter.

 
E-M

    EAI, Enterprise Application Integration, used to describe software tools that support integrating applications across a company or enterprise.

    e-business, Electronic Business, the process of using Web technology to help businesses to streamline processes, improve productivity and increase efficiencies. Enables companies to easily communicate with partners, vendors and customers, connect back-end data systems and transact commerce in a secure manner.

    EbXML, XML definitions and schema language framework designed to extend the usability of XML in e-commerce. Shares similarities with EDI.

    E-commerce, Electronic commerce; the exchange of information about goods or services via the Internet; the ability to buy and sell products and services over the Internet. May include ordering, billing, customer service and handling of payments and transactions.

    EDI, EDI (electronic data interchange) is the computer-to-computer exchange of business documents between companies. EDI is used for the transmission of business transactions in computer-readable form based on standard formats.

    EDI Capable, EDI Capble means that you are able to process EDI transactions for your EDI trading partners. This requires having EDI software, an EDI VAN, the correct hardware and EDI maps for translating EDI records into a useable form.

    EDI Compliance, EDI Compliance is the ability to send and receive EDI documents in the way that your partner requires it.

    EDI Compliant, A company is EDI Compliant if it is able to send and receive EDI documents in the various ways its partners require.

    EDI Coordinator, The person responsible for communicating with EDI trading partners and project managing new EDI implementations.

    EDI Outsourcing, EDI outsourcing is turning over to a third party the responsibility for EDI software, hardware, communications and personnel.

    EDI Service Providers, Third party companies that provide services for Electronic Data Interchange (EDI) to their clients. Services support the automated exchange of commercial data using EDI between business partners.

    EDI Services, Service provided by a third party that provide EDI mapping, translation, transportation, interconnection and integration.

    EDI Solutions, Service and software provided by a third party that provide the EDI components necessary to exchange EDI transactions with partners. Solutions can be either purchased piecemeal or outsourced in their entirety.

    EDI System, The software, hardware and labor required to receive and send EDI transactions with EDI trading partners. EDI systems can be either purchased by buying each of the components separately or outsourcing all of the components to a third party.

    EDIFACT, The United Nations EDI standard; EDI for Administration, Commerce, and Transport:. The Data Interchange Standards Association (DISA) serves as the U.S. link with the UN EDIFACT process.

    EDI Transactions, Electronic documents transmitted in EDI format according the standards of the EDI trading partner requesting the transactions.

    EDI Translation, The conversion of business application data to and from the X12 standard format. For example, to convert an invoice into an X12 standard format, some type of EDI translation software or service is required.

    EDI VAN (Value Added Network), A service for transmitting EDI that charges by the number and size of transactions.

    EDI Vendor, A third party provider of EDI software, services or VAN capability.

    Efficiency, Refers to how cost effectively company produce and sell a product or service

    EFT (Electronic funds transfer), Electronic payment in which funds are transferred between bank accounts at different financial institutions.

    e-fulfillment, The services a business' shipping department that leverage the internet for the assembly, and tracking of products. Facilitates customer specific packaging, labeling and shipping of products to customers.

    EDI Electronic Data Interchange, EDI is the computer-to-computer exchange of normal business transactions including payments, information exchange and purchase order requests.

    Electronic Data Interchange For Administration, Commerce and Transport (EDIFACT), The international standard for EDI messages. EDIFACT, also known as UN/EDIFACT, is one of the two international standards describing the syntax of EDI transmissions. EDIFACT is administered by a working party (WP.4) of the United Nations Economic Commission for Europe (UN/ECE). The EDIFACT syntax rules have been published by the ISO as ISO9735.

    Electronic Signature, A code or symbol that is the electronic equivalent of a written signature.

    Encryption, Encryption is the conversion of data into a form, called a cipher, which cannot be easily intercepted by unauthorized people. Decryption is the process of converting encrypted data back into its original form, so it can be understood.

    Enveloping, The grouping together of documents of the same type. Enveloping is used for sending groups of transactions to the same destination.

    E-Procurement, The business-to-business purchase of supplies and services over the Internet. Purchasing by customers includes the customer's internal back office applications and use of the internet to extend the applications to suppliers and partners.

    ERP (enterprise resource planning),Another name for front and back office applications software. Examples of applications within ERP include Purchasing, Materials Receipt, Accounts Payable, Accounts Receivable, Order Entry, and Customer Service.

    Exchange, see Marketplace

    Extended Enterprise, A company and its partners, including customers, suppliers and sub-contractors, that work together to design, development, produce and deliver a product to the final user. Also refers to the supply chains and logistics chains.

    Extensible Business Reporting Language or XBRL, XML definitions and schema language framework designed to extend the usability of XML to describe financial statements.

    Extensible Markup Language (XML), The universal format for structured documents and data on the Web, which is increasingly becoming the general standard document format of structured data.

    Extensible Stylesheet Language Transformation or XSLT, A specification for displaying XML as a user readable format, for example in HTML.

    Extranet, Extranets are an extension of a company network or a collaborative Internet connection to key customers, suppliers, and partners. Extranets provide access to specific company information and build closer business relationships.

    File Transfer Protocol (FTP), A mature service that transfers files from one computer to another computer over the internet.

    Firewall, A security system for protecting a server and local area network. A firewall monitors and manages traffic in and out of a network while limiting access to authorized users and programs.

    Full Duplex, A method of transmitting information over a communication channel, in which signals may be sent in both directions simultaneously.

    997 Functional Acknowledgement, A transaction set (EDI 997) transmitted by the receiver of an EDI transmission to the sender, indicating receipt and syntactical correctness of the data transmission. The functional acknowledgement is not an acknowledgement of data content.

    Functional Group, A group of similar transaction sets such as four invoices. A functional group has a functional group header segment and a functional group trailer segment. Each transaction set is assigned which is The first data element of the header segment is the functional identifier code.

    Functional Group Identifier, The functional group identifier is the first data element of the functional group header segment. The applicable functional group identifier is shown at the top of each message set after the message set name. In cases where no functional group ID is given, the message set assumes the functional group ID of the functional group.

    Gateway, a general term for software and related hardware that supports the exchange of electronic documents and messages.

    HTML (HyperText Markup Language), The programming used to display the content of web pages for use by web browsers. Used to create documents for the World Wide Web.

    HTTP (HyperText Transfer Protocol), The protocol facilitates communication between servers on the World Wide Web. It enables a server to connect to a Web server and to transfer HTML pages, i.e., enables the user to view Web pages. HTTP is based on Transfer Control Protocol/Internet Protocol(TCP/IP) developed for the Web.

    HTTPS (HyperText Transfer Protocol on Secure Sockets Layer) , HTTP (see above) that uses security called SSL (Secure Sockets Layer).

    Hub, An online exchange or market place where transactions are received and transmitted between multiple suppliers and customers.

    Hybrid EDI, Introduced by service providers to accommodate situations in which only one trading partner is capable of using EDI, while the other continues to trade using e-mail and web forms.

    Interchange, In XML and EDI (Electronic Data Interchange), it is the exchange of information between two companies.

    Interchange Control Segments (ISA/IEA), These EDI segments identify a unique interchange being sent from one sender to one receiver (see electronic envelope).

    Interchange Control Structure (X12.5), X12.5 contains specifications for the control structures (envelope) for the electronic interchange of one or more transaction sets. This standard provides the interchange envelope of a header segment (ISA) and a trailer segment (IEA) for the interchange through data transmission, and provides a structure (TA1) to acknowledge the receipt and processing of this envelope.

    Indirect Goods, Products that do not become part of a finished product.

    Interface, The connection between applications. Interfaces may connect applications within a company or to a company's business partners.

    Interoperability, The ability of an application to work with other vendors' and companies' applications.

    Internet, A global network of networks having in common the TCP/IP protocols and an agreed e-mail addressing structure that provides communications and other distributed services.

    Internet 2, The next generation Internet.

    Internet Appliance, A computer terminal that does not have an operating system or applications but only supports Web access.

    Internet Protocol (IP), The Network layer protocol on which the Internet is based. IP allows a single connectionless packet exchange. Other protocols, including TCP and UDP use IP to perform their connection-oriented or guaranteed delivery services.

    Internet Protocol (IP) address, The Internet Protocol address is a unique number which is used to represent every single computer in a Network. All the computers on the Internet have a unique IP address.

    Intranet, A web site that is only access able to employees with a password. Password security usually limits an employee to only seeing information relevant to his or her role.

    810 Invoice, An EDI 810 Invoice is an electronic version of a paper Invoice or bill. A supplier will use the 810 Invoice to communicate to a buyer the specific items, price, and quantities they have delivered and now must be paid for by the buyer. Payment terms will usually accompany the billing information.

    IP (Internet Protocol), The interaction method used by the Internet.

    Java, A programming language intended to be a universal language for the Internet. Developed by Sun Microsystems, this language creates platform independent applications which can run on any operating system.

    Javascript, A programming language that is object-based which allows Java objects to be directly embedded in an HTML page.

    JIT, Just In Time, a technique of managing inventory pioneered in Japan, under which materials are delivered by suppliers to a manufacturer as they are needed for production, rather than for storage or inventory.

    Key, A series of encrypted numbers.

    Latency, In a network, latency, a synonym for delay, is an expression of how much time it takes for a packet of data to get from one designated point to another.

    Legacy Application, This is an application in which an organization has already invested a considerable amount of time and money. Legacy applications are typically database management systems running on mainframes or minicomputers.

    LDAP (Lightweight Directory Access Protocol), An internet protocol used to access information contained in directories such as user data

    Linux, Linux is a free operating system that runs on UNIX machines.

    LTL, Less Than Truckload. A less than truck load is a shipment that requires less space than a full truck load.

    Manifest, A document from the vendor who is shipping goods to a customer that describes where the goods will arrive. Multiple destinations may be included.

    Mapping, Connecting document fields from one companies format to anther company's format is mapping. In XML and EDI mapped data elements are converted into XML or EDI data streams or vice versa.

    Marketplace, An online web site that supports multiple buyers and sellers. Examples include Pantellos,Trade Ranger and ChemConnect

    Message, The communication of information from a source to one or many destinations. This term can be used to describe a set of transactions in Electronic Data Interchange (EDI) or Extended Markup Language. The transaction can include data for a purchase order, a shipping notice, or any other electronic document.

    Microsoft .NET, Microsoft's products that support XML and web services

    Mobile Delivery Ticket, Field based delivery ticket and electronic signature to establish POD (Proof of Delivery) for payment of supplier's invoice. May be sent electronically to customer to serve as Material Receipt with electronic signature.

    Mobile Material Receipt, Field based transmission of delivery tickets, electronic signature on receipt sent to customer's A/P. May be preceded by electronic delivery ticket or shipping notice.

    Mobile Procurement,Field-based access to supplier catalog or customer's procurement system for order generation

    MRO or Maintenance, Repair, and Operations, A large group of products used to maintain facilities and production capabilities.

 
N-R

    OASIS or Organization for the Advancement of Structured Information Standards, A non-profit, international organization that creates standards for XML

    OFS Portal, A group of suppliers working together to develop standards for upstream energy products and services.

    Online Services, Supplier web site services that improve customer service by helping customers do more of their commerce interaction online. Examples include tax calculation, credit checks, shipping requirements and order status.

    Open, A way of describing software vendor products that indicates a product will work well with other programs and data from other companies including other software vendors as well as custom programs developed by a company or their trading partner. Products that are open are said to have interoperability.

    Open Systems, "Open" systems are those based on s standardized computer operating systems and hardware; standardized graphical user interfaces; communications standards, standard database management interfaces; and standardized data exchange software technology.

    Order Status Service, Allows customers online access to order status information on the supplier's web site.

    Outsourcing, As relates to electronic commerce, hiring a professional e-commerce provider to manage the day-to-day operation of an enterprise's B2B needs and Internet presence. The business can benefit from the resources and experience of the service provider without having to invest in people, hardware and software.

    Password, A secret word or phrase used to identify a user who is permitted to have access to gain information.

    Payment Remittance Transaction, An electronic authorization to make a payment.

    PDA, Personal Digital Assistant, used for any small, mobile, hand-held device that creates, stores or sends personal and financial information.

    PIDX, Petroleum Industry Data Exchange; a task group within the American Petroleum Institute responsible for XML and EDI standards in the petroleum industry.

    PO (Purchase Order), A customer's formal request to buy goods and or services from a vendor. Consists of header information and one or more line items.

    Point of Presence (POP), The place that customers call to gain access to the Internet, typically and ISP.

    Point-to-Point Protocol (PPP), A scheme that is used to connect to the Internet over the phone line.

    Point-to-Point Tunneling Protocol (PPTP), A set method for connecting Windows NT clients and servers to each other over a Remote Access Services. When PPTP is combined with encryption, it makes up a virtual network between a LAN or WAN and ordinary dial-up users.

    POP3, POP3 (Post Office Protocol 3) is the most recent version of a standard protocol for receiving e-mail. POP3 is a client-server protocol in which e-mail is received and held for you by your Internet server.

    Port 80, On a Web server or HTTPD (Hypertext Transport Protocol daemon), port 80 is the port that the server typically expects to receive from a Web client.

    Private e-Marketplace, An adapt ion of software originally intended for public marketplaces (see above) that can used by a single company for doing with its business partners.

    Procurement, The process for acquiring goods and services including planning, negotiation, vendor selection, purchase, and delivery.

    Product Life Cycle, The four stages of the retail product life cycle: 1) introduction, 2) growth, 3) maturity, and 4) decline.

    Punch Out with ERP to ERP, See Round Trip with ERP to ERP definition.

    Punch Out, see Round Trip.

    850 Purchase Order, An EDI 850 Purchase Order is an electronic version of a paper Purchase Order. A buyer will use the 850 Purchase Order to communicate to a supplier the specific items, price, and quantities they wish to have delivered. Shipping instructions will frequently accompany the purchasing information.

    855 Purchase Order Acknowledgment, An EDI 855 Purchase Order Acknowledgment is an electronic version of a phone call or fax that tells the buyer who sent you a purchase order that you will be filling the purchase order as requested. The buyer then knows that you will be filling the order and shipping the goods as requested by the date requested.

    Purchasing System, A transaction processing system that supports and documents transactions associated with the purchasing of goods and services.

    Purchasing Transaction, One of many transactions containing information relating to the purchase of a product or service.

    Qualifier, An EDI data element that identifies or defines a related element, set of elements, or a segment. The qualifier contains a code taken from a list of approved codes.

    Quick Response (QR), A supply chain management philosophy in which a business responds quickly to customer orders. Analogous to just-in-time manufacturing; a business practice in the retail industry of which an important part is the strategic deployment of XML, EDI and bar coding. Produces improved inventory turns, avoidance of out-of-stocks and reduction of excess inventory. XML and EDI are used to deliver market data gathered at the point-of-sale (POS) terminals and delivered to suppliers much more quickly than using manual systems.

    Requirements Definition, The document that specifies what a configured system has to do to meet the business and technical needs of users.

    Request For Proposal or RFP, a formal request from a customer to a supplier for a proposal that includes pricing and terms on a specific item or items and usually services also.

    ROI or Return on Investment, is the expected value of cost savings or margin increases divided by the amount of money to be invested.

    Requisition, A requisition is one part of the procurement process and is a formal request by an employee of a customer for specific items. May also include product performance requirements and required delivery dates. The requisition becomes a purchase order after internal approvals are completed.

    Roundtrip with ERP to ERP, Includes the Round Trip process described above plus customer sends and receives transactions via XML with supplier. XML transactions are automatically interfaced to suppliers and customer's ERP systems.

    RoundTrip, A procurement process in which a Customer uses an internet browser to access a suppliers web site with single sign-on and puts items into a shopping cart on the suppliers web site. Then, rather than checking out, the shopping cart is electronically sent to the customers procurement software where the procurement process proceeds. Roundtrip makes it easy for the customer to get exactly the items they want with the suppliers most current pricing without having to maintain the suppliers catalog within their procurement application. Roundtrip doesn't require the supplier to send catalog and pricing information to customers. Round Trip is the same process as Punch Out.

 
S-Z

    SAP (Systems, Applications, Products), A German software package designed to contain all the core computer models necessary to run major corporations. SAP R/2, as it is commonly known in available for mainframes; a separate Client/ Server version is called R/3.

    Salability, The ability of a business to add content and resources as its presence on the Web grows.

    Secure Server, Secure servers are used to conduct confidential transactions over the Internet. Data is sent between the servers in an encrypted form.

    Security, Techniques for ensuring that data stored in a computer cannot be read or compromised. Most security measures involve data encryption and passwords. Data encryption is the translation of data into a form that is unintelligible without a deciphering mechanism.

    Security Certificate, Information that is used to establish a secure connection. Security Certificates contain information about who it belongs to, who it was issued by, and an encrypted term that can be used to verify the contents of the certificate.

    Segment, EDI segments consist of related data elements in a defined sequence. An EDI data segment consists of a segment identifier, one or more data elements each preceded by an element separator, and a segment terminator. "*" is a typical data element separator and NL is used as a segment terminator.

    Sender, In the communication process this is the originator of the message; the point where the communication starts.

    Server, A computer in a network supplying a specialized service to "clients" on the network, such as managing a file store, managing a data base or communicating with centralized devices such as plotters, printers and scanners. Servers may be mainframes, departmental computers or PC's.

    Shopping Cart, A storage place or holding place for online purchases until the final purchase is made.

    Simple Mail Transfer Protocol (SMTP), The method by which Internet mail is delivered from one computer to another.

    SKU, Stock Keeping Unit. An SKU number refers to a particular item or part. A UPC number may be assigned to an SKU by the UCC.

    SMEs, small to medium sized companies and enterprises.

    S-Mime Encryption, Protects the privacy of e-mail. If the sender and receiver both have e-mail clients that support the S-Mime protocol, they can communicate with e-mail that is secure.

    SMTP (Simple Mail Transfer Protocol), A TCP/IP protocol used in sending and receiving e-mail

    SOAP (Simple Object Access Protocol), a protocol for software components that uses XML standards in calls for exchanging information across a network

    Sourcing, The act of choosing a supplier to fill a particular need. May be centralized in the customer's purchasing organization or may be decentralized in areas of usage or a combination of the two.

    SOX (Schema for Object-Oriented XML), A method for organizing schemas within XML that facilitates interfacing applications.

    SSL (Secure Socket Layer), A protocol for sending and receiving messages over the Internet via browsers. Special encryption for public and private keys is used to encode and decode information.

    SSL encryption, Secure Socket Layer, a security measure developed by Netscape, scrambles data to provide data encryption and authentication of servers or clients often dealing with highly sensitive data.

    Stock Keeping Unit or SKU, A unique number assigned to particular inventory item.

    Storefront Design, The way a Website is designed for the public.

    Supply chain, The interaction of suppliers and customers necessary for the production of goods and services. Includes planning, ordering, delivery/receipt, service and distribution

    Supply Chain Management (SCM), SCM refers to the effective integration of the processes related to the forecasting of the product's market demand, the acquisition of the raw materials to make the product, its manufacturing, the inventorying of the product, its transportation to market, its eventual sale (or the fulfillment of demand), and the measurement of the satisfaction of the customer who purchased it. Combines the power of the Internet with the latest technology, enabling participating suppliers to access up-to-date company information and enabling companies to better manage and track supply and demand.

    TCP/IP (Transmission Control Protocol/Internet Protocol), The basic communication language or protocol of the Internet. It can also be used as a communications protocol in intranets and extranets.

    Telecommunications Act of 1996, Established as law on 2.8.96, this act changed the laws affecting telecommunications and the Internet. An attachment to the act was the Communications Decency Act, which was intended to protect children from obscene information on the WWW.

    Tier 1 Supplier, A supplier with prime design responsibility for key subsystems or components of the end product. Also referred to as rime contractor" or simply "prime".

    Tier 2 Supplier, In the Extended Enterprise, a supplier to a Tier 1 Supplier, or a direct supplier of less critical components. Also referred to as "sub-contractor" or simply "sub".

    TL, Truck Load. A shipment of goods that fills an entire truck.

    Trading Partners, Companies that an organization does business with, for example, customers and suppliers.

    Translation/Translator, The conversion of a document from one format to another by an application system that performs the conversion or translation from document format to another document format.

    Tunneling, A methodology that allows digital data to be transmitted and read at another location that uses a different format from the original source.

    UCC (Uniform Code Council), The organization that oversees the standards for product identification and related electronic communications. The UCC oversees the Universal Product Code (U.P.C.) in the United States as well as Uniform Communication Standards (UCS) for EDI in the grocery industry and Warehouse Information Network Standards (WINS) in the warehousing and transportation industry.

    UCC 128 Label, A bar code label that is placed on each carton and that includes the purchase order number, the store location the goods are being sent to and a description of the contents in the carton. When the carton arrives at the customer's location, it is placed on a conveyer belt, the UCC-128 bar code is scanned and the carton is routed to the appropriate area. For vendor payment purposes, scanning the UCC-128 bar code confirms that the order has been received.

    UNSPSC(Universal Standard Products and Service Codes), A common standard numbering scheme for products that is 10 digits long. Up to five levels of categories may be used.The UN of UNSPSC came from the United Nations Common Coding System (UNCCS) and the SPSC came from Dun & Bradstreet's Standard Products and Services Code.

    Unfair Trade Practice Act, This is a federal law that prohibits wholesalers, retailers or professional Websites from selling their products at below cost.

    Uniform Resource Locator (URL), A World Wide Web address that specifies a specific site, page, graphic, or document on the Internet.

    United Nations Economic Commission for Europe (UN/ECE), The Economic Commission for Europe (UN/ECE) is a trade and economic body/forum in Europe which the countries of North America, western, central and eastern Europe and central Asia come together to forge the tools of their economic cooperation. This organization is the working backbone that administers EDIFACT and plays a leading role in developing EDI.

    U.P.C. (Universal Product Code), A 12 digit numeric bar code standard used in supermarkets on grocery items, magazines and over-the-counter medical items. The left five characters are assigned by the Uniform Code Council to identify the manufacturer of the product; the right five characters are assigned by the manufacturer to identify the product. A number system character appears on the left hand side and check digit on the right.

    User ID, A unique combination of numbers and letters used to identify a user by a server.

    Value Chain, A variation on Supply Chain. Value Chain is typically used to describe processes that add value in the supply chain that the final buyer in the supply chain will pay for.

    VAN (Value Added Network), A third party entity that provides a service for electronically exchanging information between trading partners. Services provided by the VANs include electronic mailboxes for EDI transmissions and EDI record keeping for audit tracking.

    VAN Interconnect, If one of your trading partners is using a different EDI service provider than you, VAN Interconnect will give you the ability to trade with these partners. VAN Interconnect allows two different VANs (Value Added Networks) to exchange EDI documents.

    Vendors, Companies or people that sell products or services.

    VICS, Voluntary Interindustry Commerce Standards Association.

    VICS EDI implementation, The VICS EDI implementation guidelines contain transaction sets which support the following business functions - Product Development/Merchandising Ordering, Logistics, Financial, Business Support, Import.

    VMI (Vendor Managed Inventory), A technique used by customers in which manufacturers receive sales data in order to forecast consumer demand more accurately. The vendor uses the sales information to maintain the proper level of inventory for each product that is stocked.

    VPN ( Virtual Private Network ), Network connections or "pipes" that encrypt data sent across the internet to provide security and control of the information transmitted between computers.

    Web EDI, The ability to exchange EDI transactions with trading partners over the web (internet) and avoid costly VAN charges per transaction.

    Web Based EDI, Solutions that have the capability to support exchange EDI transactions with customers (trading partners) over the web and avoid having to pay for expensive VAN fees per transaction.

    Web Server, A computer whose purpose is to display web pages to Internet users.

    WINS (Warehouse Information Network Standards), A set of EDI standards for warehousing and distribution, maintained under the auspices of the Uniform Code Council (UCC). WINS is a subset of the ANSI X12 national standard.

    Wireless, Communications, monitoring, or control system in which electromagnetic or acoustic waves carry a signal through atmospheric space rather than along a wire. In most wireless systems, radio-frequency (RF) or infrared (IR) waves are used. Some monitoring devices, such as intrusion alarms, employ acoustic waves at frequencies above the range of human hearing.

    Wireless Application Protocol (WAP), An open, global application standard that enables wireless devices to instantly and easily access and interact with information and services. Used in mobile computing devices, it features a micro Web browser that displays and transmits specially formatted pages over a broad range of mobile data channels.

    World Wide Web (WWW), A collection of information located on many Internet servers that can be accessed with a browser or by navigating via hypertext links.

    Work Flow Management, The electronic control and distribution of documents and work instructions.

    WWW, World Wide Web; is a set of pages or documents that are connected by hyperlinks.

    X12, Accredited Standards Committee. X12 standards are used in many industries for conducting ecommerce via EDI.

    xCBL or Common Business Library, A set of XML data tag definitions and schema language framework. Originated by CommerceOne.

    XML (eXtensible Markup Language), A universal format for structured documents and data on the Web. A file format for representing data, a schema for describing data structure, and a mechanism for extending and annotating HTML. Document Type Definition (DTD) tags carry information pertaining to a data structure and its content within a document. The tags are used by XML interpreters to understand the data contained within a particular document.

    XML/EDI, provides a standard framework/format to describe different types data so that the information in a transaction, catalog or a document in a workflow can be searched, decoded, manipulated, and displayed consistently. Combining XML and EDI provides a powerful means of exchanging data between many different types of organizations.

Another definition of EDI

What is EDI?

What is Electronic Data Interchange (EDI)? Unlike other electronic data interchange articles, this piece will help provide a complete understanding of the electronic data interchange process, including an overview of EDI benefits and drawbacks.

Basically, the electronic data interchange process is the computer-to-computer exchange of business documents between companies. EDI replaces the faxing and mailing of paper documents. EDI documents use specific computer record formats that are based on widely accepted standards. However, each company may use the flexibility allowed by the standards in a unique way that fits their business needs.

EDI is used in a variety of industries. In fact over 80,000 companies have made the switch to EDI to improve their efficiencies. Many of these companies require all of their partners to also use EDI.

Overview of EDI Benefits and Drawbacks

The EDI process provides many benefits. Computer-to-computer exchange of information is much less expensive than handling paper documents. Studies have shown that processing a paper-based order can cost $70 or more while processing an EDI order costs a dollar or less. Much less labor time is required. Fewer errors occur because computer systems process the documents rather than processing by hand.

EDI transactions between companies flow faster and more reliably than paper documents. Faster transactions support reduction in inventory levels, better use of warehouse space, fewer out-of-stock occurrences and lower freight costs through fewer emergency expedites.

Paper purchase orders can take up to 10 days from the time the buyer prepares the order to when the supplier ships it. EDI orders can take as little as one day.

Drawbacks are few and far between, but there are some. For example, companies choosing to implement both paper and EDI processes must manage both of these processes. However, as stated before, using EDI is much more efficient than using paper, lending strength to the argument against paper documents. Also, companies must ensure that they have the resources in place to make an EDI program work; however, the need for these resources (or their hiring) may be offset by the increased efficiency that EDI provides.

Here is an example of how the electronic data interchange process works. A buyer prepares an order in his purchasing system and has it approved. Next, the EDI order is translated into an EDI document format called an 850 purchase order.

The EDI 850 purchase order is then securely transmitted to the supplier either via the internet or through a VAN (Value Added Network). The buyer's VAN is a like an electronic post office that interconnects with the supplier's VAN. The VANs make sure that EDI transactions are sent and received. The supplier's VAN ensures that the supplier receives the order. The supplier's computer system then processes the order. In the case of CovalentWorks' clients, we provide VAN transportation and our servers provide all of the software and hardware required to process EDI documents. Only internet access and email are needed.

Data security and control are maintained through out the transmission process using passwords, user identification and encryption. Both the buyer's and the supplier's EDI applications edit and check the documents for accuracy.

EDI Requirements

Each trading partner has unique EDI requirements. These will include the specific kinds of EDI documents to be processed, such as the 850 purchase order used in the example above, 856 advance ship notices and 810 invoices. The fact is that most any business document that one company would exchange with another company can be sent via EDI. However each EDI document must be exchanged with the partner in exactly the format they specify.

Many partners will have an EDI implementation guide or kit that explains their specific requirements. Maps are required to translate the EDI documents from the trading partner's format into the format that is useable by the receiving party. CovalentWorks handles all of the mapping and translation requirements for our clients.

EDI capability involves either buying or outsourcing the following components:

    * Software for communications

    * VAN service for EDI transmission

    * Mailboxing of EDI transactions

    * Mapping

    * Translation

VAN, ASYNC, BISYNC and direction connection and Internet communications will be required by various partners. A server or PC, communication devices and peripherals will be needed as well as secured office space, monitored security, backups and redundant power. Additional software will be needed if integration of the EDI transactions with back office systems is desired. A VAN will need to be contracted for transmissions. Personnel must be trained in how to use the software and communication devices. Maps will then need to be developed.

EDI overview

EDI: What is it?

EDI is simply the sending and receiving of information using computer technology.

Its efficiency has made it a condition of doing business in dozens of industries, including retail, grocery, warehousing, transportation (rail, ship, and trucking), health care, education, real estate, and government. Any standard business document that one company would exchange with another (such as a purchase order, invoice, shipping schedule, inventory inquiry, and claim submission) can be exchanged via EDI between two parties, or trading partners, as long as both have made the preparations.

EDI cannot be activated with a flip of the switch or in a moment's notice. Many procedures must be carried out in preparation for exchanging EDI data with a trading partner. This will be explained in a later section.

The use of EDI is not limited by differences in companies or communication methods. Instead, EDI bridges the information gap that exists between companies using different computer systems.

Although this tutorial makes many references to the ANSI X12 standards, note that other standards exist. For instance, EDIFACT is commonly used in Europe and in the automotive industry. HIPAA (Health Insurance Portability and Accountability Act) is designed for the healthcare industry. The translator you select should support all standards.

Can't I just use e-mail?

EDI is transmitted in a structured format, based on the use of message standards, which ensures that all participants use a common language.

For instance, if you were to receive a PO via EDI, the EDI software would take the data and put it into a "readable format" then import it in your existing software. The result? No manual data entry! In addition, the process can be programmed to take place without human intervention.

What are the benefits of EDI?

• Reduced postage costs
• Reduced expenses
• Speed. Because information is moved faster and with greater accuracy, time spent communicating with suppliers is decreased.
• Elimination of paper documents.
• Elimination of labor intensive tasks, such as data entry.
• Greater accuracy of information.

Setting up EDI

Although electronic mail is faster than standard mail and eliminates paper, it differs greatly from EDI because the data is in an unstructured format. If you were to get a purchase order as an e-mail, you would likely print out the document and enter the data into another program, such as an accounting or inventory package.

• Determining the most appropriate solution.

  Once the need is established, you have to determine what type of solution best suits your business. If you are exchanging only a few documents per week or month, you may find it more economical to use a service-based solution. If you anticipate exchanging a lot of documents with several trading partners, an in-house translator is likely to be more efficient.

  Before you can determine which is the better approach, you need to project:

  • With how many companies do you anticipate exchanging EDI?
  • What type of transactions do those companies require? EDI transactions are usually given a number. A list of the more common translation sets may be found here.
  • How often do you expect to hear from these companies? Throughout the day? Weekly? Quarterly?
  • In dealing with your trading partner(s), are you sending your transactions to a specific location or individual facilities?
  • Are you being asked to supply UCC-128 labels?

  Answers to these questions will enable you to select the most effective solution.

• Getting the implementation guide

  Whether you use a service based solution or in-house software, you will need to format the data to your trading partner's specifications. The formatting process, called mapping, is usually a part of the technical support service offered by your software provider, and the guidelines for mapping are in your trading partner's implementation guide.

  Often the implementation guide contains a trading partner questionnaire, which needs to be filled out and returned as soon as possible. This is the first step in establishing a trading partner relationship.

  Please note that even though all of your trading partners may be using X12 standards, EDI guidelines are not universal. The map created for Company A's invoice cannot be copied and used for Company B, as Company B likely has its own criteria. As a result, you will need an implementation guide for every trading partner.

• Setting up communications

  One of the most important aspects of EDI is selecting how the data is going to get from one place to the other, such as through a VAN or using a direct communication. In the majority of the cases the trading partner will designate the method.

  VAN (Value Added Network)

  Often referred to as the "electronic post office", a VAN is a third party service that transmits and stores data in the "electronic mailbox" until it is picked up by the appropriate party. Since the EDI message contains addressing information, the van routes the message to the mailbox of the recipient. Until recently, it was considered the most secure method of transferring data.

  Direct Connection

  Unlike the VAN, a direct connection allows you to pass the data straight to the receiving party.

  Types of direct connection include VPN (Virtual Private Network), FTP (File Transfer Protocol), and EDIINT (EDI over the Internet). Usually EDIINT is done in conjunction with AS2 software, which encrypts the data before sending it over the Internet.

• Installing the software

  There are two parts to EDI: the translator and the mapper. Installing each part is simple and takes seconds. However, each piece of software must be customized to fit your specific needs.

  Translator

  The translator is the engine behind the EDI process and governs the day-to-day activity. It has several components, including the engine itself, the EDI maps, the standards, and communications ability.

  Mapping tool

  Data is formatted using the mapper, a software tool that enables one to properly organize the data so that it follows both the EDI and the trading partner's standards. Maps contain the rules of the transaction; these rules will be enacted by the translator itself. Mapping also includes integration with an existing application. The EDI translator can be programmed to go into an application, extract information, and send it out as an EDI file. It can also import incoming data, thus eliminating the need for data entry. As said earlier, the mapping design is often done as part of the EDI supplier's technical support service.

• Final steps in the set-up process

  The trading partner will send sample data, which is then mapped following the guidelines. The completed map is tested by sending sample data (which is now formatted) back to the trading partner. If it fails, the mapping error must be found and corrected. Upon successful testing the EDI partnership is ready to go live.

How does EDI work?

For a better understanding and a practical example of How EDI works - Let's presume that a buyer is sending a purchase order to the supplier.

• Most likely the information contained in the purchase order resides in a computer application (for example, an inventory package) on the buyer's PC. As long as it is possible to import and export files from the application, pertinent information can be extracted and mapped into a file for the EDI translation software.
• The EDI translator will do compliance checking to ensure that the mapping complies with EDI standards and the trading partner's implementation guide. Afterward, it will translate the message into an EDI format.
• A communications connection is established in order to transmit the EDI purchase order. The EDI translation software controls the communications software.
• The file is sent to either a mailbox, FTP site, or directly to AS2 recipients to be picked up.
• The computer software receiving the EDI purchase order will reformat the incoming data so that it can be readily imported into an existing application's data files. For instance, a PO received via EDI could be input into the Order Entry module.
• When the order is received, the software generates a Functional Acknowledgement back to the buyer. The FA indicates that the message was received and was/was not compliant with the EDI standard. It does not address the actual data in the message.

Common Transaction Sets

• TSet: 880 - Grocery Products Invoice

  This X12 Transaction Set contains the format and establishes the data contents of the Grocery Products Invoice Transaction Set (880) for use within th..

• This X12 Transaction Set contains the format and establishes the data contents of the Grocery Products Invoice Transaction Set (880) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set can be used to provide for customary and established grocery industry practice relative to billing details for finished goods in a retail or wholesale consumer market. The transaction set can be used by the supplier or broker organization to request payment from a retailer or wholesaler organization. This transaction set is to be used for standalone detail billing and cannot be used for statement billing or credit/debit adjustments.

• TSet: 875 - Grocery Products Purchase Order

  This X12 Transaction Set contains the format establishes the data contents of the Grocery Products Purchase Order Transaction Set (875) for use within...

• This X12 Transaction Set contains the format establishes the data contents of the Grocery Products Purchase Order Transaction Set (875) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set can be used to provide for customary and established grocery industry practice relative to the placement of purchase orders for finished goods in a retail or wholesale consumer market. This standard can be used by a retailer or wholesaler organization to request delivery of finished goods from a broker or supplier organization. This transaction set should not be used to convey purchase order changes or purchase order acknowledgment information.

• TSet: 856 - Ship Notice/Manifest

  This X12 Transaction Set contains the format and establishes the data contents of the Ship Notice/Manifest Transaction Set (856) for use within the co...

• This X12 Transaction Set contains the format and establishes the data contents of the Ship Notice/Manifest Transaction Set (856) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to list the contents of a shipment of goods as well as additional information relating to the shipment, such as order information, product description, physical characteristics, type of packaging, marking, carrier information, and configuration of goods within the transportation equipment. The transaction set enables the sender to describe the contents and configuration of a shipment in various levels of detail and provides an ordered flexibility to convey information. The sender of this transaction is the organization responsible for detailing and communicating the contents of a shipment, or shipments, to one or more receivers of the transaction set. The receiver of this transaction set can be any organization having an interest in the contents of a shipment or information about the contents of a shipment.

• TSet: 855 - Purchase Order Acknowledgment

  This X12 Transaction Set contains the format and establishes the data contents of the Purchase Order Acknowledgment Transaction Set (855) for use with...

• This X12 Transaction Set contains the format and establishes the data contents of the Purchase Order Acknowledgment Transaction Set (855) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide for customary and established business and industry practice relative to a seller's acknowledgment of a buyer's purchase order. This transaction set can also be used as notification of a vendor generated order. This usage advises a buyer that a vendor has or will ship merchandise as prearranged in their partnership.

• TSet: 850 - Purchase Order

  This X12 Transaction Set contains the format and establishes the data contents of the Purchase Order Transaction Set (850) for use within the context ...

• This X12 Transaction Set contains the format and establishes the data contents of the Purchase Order Transaction Set (850) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide for customary and established business and industry practice relative to the placement of purchase orders for goods and services. This transaction set should not be used to convey purchase order changes or purchase order acknowledgment information.

• TSet: 820 - Payment Order/Remittance Advice

  This X12 Transaction Set contains the format and establishes the data contents of the Payment Order/Remittance Advice Transaction Set (820) for use wi...

• This X12 Transaction Set contains the format and establishes the data contents of the Payment Order/Remittance Advice Transaction Set (820) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to make a payment, send a remittance advice, or make a payment and send a remittance advice. This transaction set can be an order to a financial institution to make a payment to a payee. It can also be a remittance advice identifying the detail needed to perform cash application to the payee's accounts receivable system. The remittance advice can go directly from payer to payee, through a financial institution, or through a third party agent.

• TSet: 812 - Credit/Debit Adjustment

  This X12 Transaction Set contains the format and establishes the data contents of the Credit/Debit Adjustment Transaction Set (812) for use within the...

• This X12 Transaction Set contains the format and establishes the data contents of the Credit/Debit Adjustment Transaction Set (812) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to notify a trading partner of an adjustment or billback and may be used to request an adjustment or billback. It identifies and contains the details and amounts covering exceptions, adjustments, credits, or debits for goods or services. This transaction set is multidirectional between trading partners.

• TSet: 811 - Consolidated Service Invoice/Statement

  This X12 Transaction Set contains the format and establishes the data contents of the Consolidated Service Invoice/Statement Transaction Set (811) for...

• This X12 Transaction Set contains the format and establishes the data contents of the Consolidated Service Invoice/Statement Transaction Set (811) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set provides for the billing or reporting of complex and structured service invoice/statement detail. This standard can be used by organizations who are interested in sending or receiving either consolidated or standalone invoices for service arrangements which require processing other than that done for the typical product invoice. The Consolidated Service Invoice/Statement can be used as a credit/debit memo to differentiate between payable invoice items and information-only memo items. This transaction set should not be used as a standalone notification of a credit/debit adjustment.

• TSet: 810 - Invoice

  This X12 Transaction Set contains the format and establishes the data contents of the Invoice Transaction Set (810) for use within the context of an E...

• This X12 Transaction Set contains the format and establishes the data contents of the Invoice Transaction Set (810) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide for customary and established business and industry practice relative to the billing for goods and services provided.

• TSet: 754 - Routing Instructions

  This X12 Transaction Set contains the format and establishes the data contents of the Routing Instructions Transaction Set (754) for use within the co...

• This X12 Transaction Set contains the format and establishes the data contents of the Routing Instructions Transaction Set (754) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set is used to communicate routing instructions to a supplier for a specific shipment. It can be used also to respond to a Request for Routing Instructions Transaction Set (753).

• TSet: 753 - Request for Routing Instructions

  This X12 Transaction Set contains the format and establishes the data contents of the Request for Routing Instructions Transaction Set (753) for use w...

• This X12 Transaction Set contains the format and establishes the data contents of the Request for Routing Instructions Transaction Set (753) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set can be used to request routing instructions and provide general information about merchandise that is ready to be shipped.

• TSet: 214 - Transportation Carrier Shipment Status Message

  This X12 Transaction Set contains the format and establishes the data contents of the Transportation Carrier Shipment Status Message Transaction Set (...

• This X12 Transaction Set contains the format and establishes the data contents of the Transportation Carrier Shipment Status Message Transaction Set (214) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set can be used by a transportation carrier to provide shippers, consignees, and their agents with the status of shipments in terms of dates, times, locations, route, identifying numbers, and conveyance.

• TSet: 210 - Motor Carrier Freight Details and Invoice

  This X12 Transaction Set contains the format and establishes the data contents of the Motor Carrier Freight Details and Invoice Transaction Set (210) ...

• This X12 Transaction Set contains the format and establishes the data contents of the Motor Carrier Freight Details and Invoice Transaction Set (210) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide detail information for charges for services rendered by a motor carrier. It is used both as a motor carrier invoice to request payment or as details pertaining to motor freight shipment(s) charges.

• TSet: 204 - Motor Carrier Load Tender

  This X12 Transaction Set contains the format and establishes the data contents of the Motor Carrier Load Tender Transaction Set (204) for use within t...

• This X12 Transaction Set contains the format and establishes the data contents of the Motor Carrier Load Tender Transaction Set (204) for use within the context of an Electronic Data Interchange (EDI) environment. This transaction set can be used to allow shippers or other interested parties to offer (tender) a shipment to a full load (truckload) motor carrier including detailed scheduling, equipment requirements, commodities, and shipping instructions pertinent to a load tender. It is not to be used to provide a motor carrier with data relative to a Less-than-Truckload bill of lading, pickup notification, or manifest.

• TSet: 131 - Student Educational Record (Transcript) Acknowledgment

  This X12 Transaction Set contains the format and establishes the data contents of the Student Educational Record (Transcript) Acknowledgment Transacti...

• This X12 Transaction Set contains the format and establishes the data contents of the Student Educational Record (Transcript) Acknowledgment Transaction Set (131) for use within the context of an Electronic Data Interchange (EDI) environment. The Student Educational Record (Transcript) Acknowledgment record is used to ensure that the original transcript did, in fact, come from the proper office at the educational institution indicated as the sender and that certain key elements of the transcript were received as they were sent. It also provides the sending institution with confirmation that the original record was received by the intended recipient and the date it was received. This information may then be relayed to the student or other individual who requested the record transfer.

• TSet: 130 - Student Educational Record (Transcript)

  This X12 Transaction Set contains the format and establishes the data contents of a Student Educational Record (Transcript) Transaction Set (130) for ...

• This X12 Transaction Set contains the format and establishes the data contents of a Student Educational Record (Transcript) Transaction Set (130) for use within the context of an Electronic Data Interchange (EDI) environment. The student transcript is used by schools and school districts and by post-secondary educational institutions to transmit current and historical records of educational accomplishments and other significant information for students enrolled at the sending schools and institutions. The transcript may be sent to other educational institutions, to other agencies, or to prospective or current employers. When a student transfers from one educational institution to another, it is essential that the student's prior educational record be made available to the institution to which the student wishes to transfer. For students in Pre-Kindergarten through Grade 12, prompt records transfer will assist receiving schools in making an appropriate initial educational placement of student. It is important that this information be available on a timely basis. In some cases for post-secondary students, it is this record which determines whether the student will be accepted at the receiving institution. In all cases, it is important to know what course work the student has already completed so that the student may be properly placed in courses and educational programs at the next institution. When a student seeks employment or wishes to inform another agency of the student's academic accomplishments, the student transcript may be sent to a prospective employer, branch of the military, or another government agency. The student transcript contains personal history and identifying information about the student, the current academic status, dates of attendance, courses completed with grades earned, degrees and diplomas awarded, health information (Pre-Kindergarten through Grade 12 only), and testing information.

EDI benefits

EDI Benefits

Within various industries, EDI has been used to great advantages, and many benefits have been expounded in its regard. EDI´s benefits relate to environmental impact, improved time efficiency, improved accuracy and increased flexibility, enhanced partnership, labor costs, shipping. EDI creates a system whereby documents and data can easily be transported from one source to another, and is able to overcome incompatibility issues.

EDI is a set of standards which govern data formats and thereby allows disparate computer systems to be able to “read” the data which is sent. EDI documents are also able to be stored at a Value Added Network (VAN), which is like a virtual storage house, and is able to transmit the message to the receiver when they are available. The advantage of a VAN is that they are able to re-transmit the message to the receiver if it does not go through. The EDI provides advantages to both small and large businesses and creates an efficient business environment with little to no human intervention, which makes it perfect for automated services. Therefore EDI is used highly within departments such as invoicing and ordering.

The Improvements

EDI will reduce and improve various elements of any business or corporations expenditures. It allows some processes to become fully automated, thus reducing the amount of human time required on them. It can fully take over in data entry, manual reviews and reconciliations, sorting, copying and filing documents. However, importantly, the number of errors is heavily reduced due to the minimization of human input. Therefore the number of hours required for a person to process an order from bid request to invoicing is greatly reduced. In this way, labor costs are reduced, and time efficiency improved. Transactions are faster, more efficient and accurate.

EDI enables the processing of business data up to the last second of deadlines as it is an automated electronic transmission. As EDI compliance is somewhat of a must in this business climate, once the business is in line, it will reap benefits from this efficient system. Businesses will be able to promote mutual profitability by employing EDI, and thus create enhanced partnership situations. EDI allows for a reduction in deductions and credits for mistakes; an improvement in the number of quality purchase orders; hours saved in paper administration; increased speed to retail of new items; major improvements in retail scanning accuracy.

Due to this increased efficiency of non-paper accounts, cash flow will improve as electric fund transmission is able to begin much earlier than previously. Shipping is also improved as EDI provides quick and efficient information as it relies on barcode information to communicate. It is able to track inventory and eliminates the incidence of lost packages due to their isolation from the larger shipping order. EDI greatly improves accuracy of data as it is all automated. There is a reduction of re-keying errors, as there are none required. Therefore fewer items will be lost, returned or required from back order. EDI simplifies the manufacturing process as it is able to provide one time data entry; reduced errors; on line data storage; faster management reporting and automatic reconciliation.

Industry Applications of EDI

The benefits of EDI can be seen across various industries which have embraced the data interchange system. It is widely used within the health industry, government agencies, and the automotive industry and general businesses. It is used widely is automated document services which can include: export/import information for international shipments carrier-to-carrier way bill exchange; reservation or pickup requires; shipment information from shipper to carrier; freight bill data, carrier to payer; shipment tracing information; payment data, payer to bank, bank to bank, bank to payee. All of these various industries which utilize EDI have standards of their own, but these can be minimized when using the standardized EDI document formatting.

EDI provides a varied number of documents which are standardized across industries. Within these industries, there are benefits to the buyer such as lower inventory levels, quick order acknowledgment and efficient invoicing processing. The benefits for the supplier have been previously listed. Within the automotive industry, EDI helped to improve inventory costs, as they were able to apply EDI in order to establish the single day inventory lists. While this helped the buyer, it put pressure on the supplier to absorb the costs. Although the industry was improved, it led to some confusion, as each major automotive maker used its own standards. However, these were made clear through the Automotive Industry Action Group which worked with automakers and suppliers to develop an EDI standard for the entire industry.

As such, the industry was able to create a standard which was related just to the automotive industry. Government entities are also benefiting from EDI – such as the Minnesota Department of Labor and Industry, which utilizes EDI in its injury claim reports. They claim that EDI increases the level of reportage of injuries, and improves on reporting times. They are also able to automatically send out report maintenance documents, reducing the level of human interference, and thereby reducing labor costs. The medical health industry also utilizes EDI in order to process claims more swiftly for medical providers. Within the health industry, the benefits include those of time effectiveness and reduced paper load.

However, it also allows consumers – from insurance company, hospital, physician or supplier to enjoy these benefits. Current EDI standards are able to support all the support for health care industry standard documentation. This includes government regulations which provide for the privacy and security of electronic transactions. EDI is able to comply with the standards, as it is completely secure. EDI is also able to integrate with other systems such as the clinical and accounting systems of hospitals and private clinics. The financial sector is also well entrenched with EDI as it is used to establish credit checks, statement orders, lockbox data and debit advices.

Internet EDI Benefits

Although EDI can be run over a variety of electronic communication systems, currently many industries are looking at internet EDI, due to its ability to reduce costs. Using other forms of electronic mediums, companies may be required to use VANs which store the electronic information until the receiving partner is ready to accept. When this is eliminated, it could reduce the cost to companies considerably. Therefore internet EDI is being explored by many. It allows the partnering businesses to use secured lines of communication to transmit information.

Internet EDI provides the benefits of EDI in that is almost instantaneous transmission, and therefore will cut down on time which would normally be eaten up by postal delays. It is currently used by the automotive, health and the financial sector. These businesses are able to further reduce their transmission costs through the use of internet EDI. By utilizing the Internet, EDI is able to access an increased variety of businesses that may not be able to afford the setup of other media transmissions. It can allow for reduced costs through the process of either request or delivery or of error produced through rekeying. Overall, Internet benefits are open to all businesses that require EDI services.

Looking Ahead

By the end of the 1990´s many industries were being impacted by the use of EDI in everyday practices. Currently, the EDI is no longer a trend but an integral part of many businesses and their management. While EDI has existed since the 1960´s it has kept up to date and can now provide electronic transmissions in various electronic means such as modem, HTTP and the internet. With these options available, and with many industries on board, the future of EDI looks strong.

However, there may be some traps EDI could fall into. Software must be accessible and easy to use. Users should be aware of the varied options EDI can provide for businesses. Proponents of EDI should be clear in their advertising, and explain the system thoroughly and clearly. Currently EDI is being connected with other systems such as XML, which can only be of benefit. These systems together create an efficient and fast delivery of data transmission.

There are a varied amount of services which offer companies and businesses the opportunity to increase their profit margins as well as their ability to contact trade partners more efficiently. They are able to extend the use of EDI through the many modes of transmission is can go through. Also EDI is able to evolve with new systems and therefore supply an up to date system that is well established within many businesses and company systems. It is this kind of flexibility which will allow EDI to continue into the future as it has since its inception.

How EDI work with XML

How EDI work with XML

EDI and XML systems have been seen as the opportunity to create a holistic approach to data information exchange that can deliver and process simple, durable and effective business transactions by electronic means. To achieve this, methods must be employed that are not only of value within the market today, but have an extension into the future. To guarantee the technology will be widely accepted and used, it must be made freely available as an open standard. In this way, the systems can work in conjunction to create a truly effective solution to business data exchange.

Using XML/EDI is far more than enveloping EDI with XML. These two powerful technologies work conjointly to provide a system of data information exchange that is interoperable and can give a range of presentation options, as well as improve the efficiency of the exchange. XML provides for a file format for data representation, whereas EDI creates standard messages formats enabling the data to be sent via any electronic messaging service. Therefore, by combining the two technologies, a more powerful data exchange too is created which will improve the services and styles of businesses and corporations.

How XML/EDI works

XML/EDI is the combination of five technologies: XML, EDI, templates, agents and repository.

XML (eXtensible Markup Language) comes out of the history of the Web based language known as HTML. However, HTML was just a subset of the original and highly complex SGML document syntax. Now, XML mitigates the two, as it is not as highly complex as the SGML, but is holds greater capabilities than the HTML. XML tokens and frameworks are the structure that moves the other components throughout the network. XML tokens substitute or complement existing EDI segment identifiers. XML also comes with the generally enriched components of the Web and the Internet.

EDI provides a way to send data in a simple format, and allows the receiver to interpret the information they have just received. XML/EDI is compatible with all previous EDI transactions, but also provides progression to the new wave of data transaction. Therefore, it is mot merely discarding old systems, but incorporating them into new ones. Templates provide rules that maintain the cohesiveness of the entire system. Templates are parallel to XML as a special section and set of tokens, and can be easily read and interpreted – they appear more as a spread sheet. They are supplemented by DTDs or Document Type Definitions, which allow the documents to be run in other operating systems. The templates enable processing of the transactions.

To interpret these templates, Agents are required. Agents not only interpret, but also interact in order to provide the best template for each task. They interact not only with the user, but also the transaction. The agents will research which template is best for each task. They can also reference DTDs for presentation of the information. Repository is a store of information which is a Shared Internet Dictionary that allows user to manually look up meaning and definition of EDI elements. The more advanced level provides automatic lookup for the user. It sets up the software the Agents require to cross reference unknown entities. It is an important component of the entire framework, as it provides the semantic grounding for business transactions.

Why XML/EDI works

The combined system of XML/EDI allows for a variety of interaction models to occur such as the following:

Star Model
Hybrid Model
Ad-hoc Model
Web Model

These models demonstrate the different styles of information interchange available to the various systems in operation. The Star model is an organization which would be considered the oldest style of current data exchange. It is where a major business sets the standards for the younger or smaller partners. The ad hoc model is the new net based model, whereby smaller trading partners set up their own interactions which are malleable over time, and may or may not become formal methods. The hybrid model combines these first two. The Web model is one where the content is the most information being received. It can either be ordained by pre-set rules, or can come from a request for information. These frameworks are in place in order to provide a variety of solutions to the issues of creating more flexible E-business systems. These models also require an overall framework of interlinked systems which allow for the ready and easy reading of documents.

This model is not an all or nothing model. Where certain elements are required they should be used. But by new means is it intended to set up a definite framework by which a company or business should set up their E-Commerce or business trading. All of the layers can be used independently and simply provide increasing layers of sophistication both within the document and its presentation. In simplest terms, the framework can be used to validate the message, or check that they are well formed XML. However, it can also be set up for the documents to be linked to the rule-templates, and have inbuilt rules for processing the data you received. It is up to the user to decide how to make the framework function.

Why XML/EDI is different

Mainly the difference between XML/EDI and other systems is that the information is able to be decoded from one operating system to another much more easily and with a greater style within the presentation of the product. However, the system can also be used at its most basic level when that is required. XML/EDI transactions are self describing through the use of XML tags and DTDs. This means that other applications processing XML/EDI documents are able to understand the content through access to just the content of the transaction.

There are various reasons why XML/EDI is important in the new direction of technology. It is founded on open standards, and provides for self-describing transactions. This gives greater access to a variety of systems wishing to access just the content of the document.

XML/EDI allows for those using the tool to expand upon existing products and create new and malleable systems of data exchange. The XML/EDI system interfaces with legacy systems well; it also uses a framework of evolving best practice by incorporating shared dictionaries, which allow for a greater access to templates and their best use. The XML/EDI framework allows for object-based documents – and creates a system whereby data and rules are in parallel.

It provides the way to follow a move down to a document-centric environment. Components within the model allow for a more flexible business model which is cheaper and easier to implement, thereby allowing greater access to more trading partners. However, most importantly, it creates interactivity between transactions enabled by the web rather than having one off transactions. XML/EDI is not simply two technologies thrown together; it is the use of complementing technologies in combination to create a new and advanced style and form of data exchange.

The combination of EDI and XML to create a new vision of XML/EDI allows for a more efficient and modern approach to data exchange within an environment of changing technologies. It presents a new wave of data exchange that can be utilized at various levels of complexity by simple businesses to large corporations. It works upon a framework of interconnected, but not intrinsic levels which can be manipulated for the specific use of each data exchange. At its simplest form, the content of the exchanged data piece can be read and analyzed; however when required, the data can be presented within the current possibilities of technology due to the abilities of the XML tool. As such, XML/EDI allows for a great range of applications within the range of data exchange.

The data can be transported using any electronic messaging device such as modem, floppy, LAN, WAN, Internet and so on. It is the combination of these tools which allows different types of data to be efficiently exchanged while also having an interaction between the data and the user and the system – through the use of Agents and Repository. Hence a document can be manipulated by initially implementing the EDI dictionaries and extending the vocabulary through on-line repositories to include business language, rules and objects.

Thus a brand new way of analyzing received messages is created, which is greater than the sum of the parts. These can be combined in various practices of business whether it be between smaller and large trading partners, or between sole traders, this combination of technologies improves data exchange, and brings it in line with current business language and presentation of ideas.