Define Electronic Data Interchange (EDI). Compare EDI on Value Added Network (VAN) and EDI on the internet.

Subject E-Commerce
NU Year Set: 6.(d) Marks: 5 Year: 2012

Electronic data interchange (EDI) is the electronic transmission of structured data by agreed message standards from one computer system to another without human intervention. It is a system for exchanging business documents with external entities.

An EDI VAN uses phone lines to create a business-to-business network for electronic communication. This particular type of network is called “value-added” because of the variety of services and communication protocols facilitated that otherwise wouldn’t be available through a regular phone line.

Using an EDI VAN creates seamless communication channels between supply chain vendors and other trading partners while allowing data translation between multiple formats. A lot of this communication is automated through the VAN, providing more efficient e-commerce transactions and supply chain management.

VANs are time-tested and utilized by all industries and provide several distinct advantages over other forms of electronic business communication.

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