What is EDI?
Electronic data interchange (EDI) is the computer-to-computer exchange of standardized business documents, such as purchase orders, invoices and shipping notices, between trading partners without manual re-keying.
In more detail
Two families dominate. ANSI ASC X12 is common in North America, and UN/EDIFACT is an international standard (its syntax is published by ISO as ISO 9735) used widely in Europe, retail, shipping and customs. Each document type has a numbered transaction set or a named message: in X12, an 850 is a purchase order, an 810 an invoice and an 856 an advance ship notice. Partners connect through a value-added network (VAN) or direct links such as AS2, and large retailers and manufacturers often require EDI from suppliers. EDI predates XML and the web, which is why the formats look cryptic, but it still moves a large volume of orders and invoices. Automation work is mostly mapping EDI fields to ERP fields and handling rejects.
Example
A supplier receives an X12 850 from a retail customer, maps it into its ERP as a sales order, sends an 855 acknowledgment and later an 856 ship notice and an 810 invoice. Documents rejected for unknown item numbers land in an order desk queue.