The components of EDI and related options

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Electronic Data Interchange (EDI) has three major components. They are,
• Trading partners
• Translation software
• Communications

Trading partners: These are business organizations that agree to exchange business information, data and documents via EDI. Small, medium and large organizations that are involved in various types of business activities are part of this group. For partners that dare to trade options that are now being made available are endless.

Translation software: This software written in some of the most popular platforms regulates most of the operations. Some of its main features include,
1. It is dual purpose software and it converts files to or from an EDI format called a ‘document’
2. A document is known as an EDI message and the definition specifies the content and sequence of the data to be included
3. In the case of outbound business information, data or documents (we will refer to as document), an internal application file format is translated into an EDI format
4. For inbound documents, the EDI format is translated into an EDI format
5. For inbound documents, the EDI format is retranslated into an internal application file format
6. It is not necessary for trading partners to use the same translation software, nor is it necessary for them to have similar hardware platforms
7. Software and hardware independence is one of the major advantages of EDI

Communications: The transmission and reception of ‘document’ between trading partners using compatible hardware and software, which best suits their requirements.