Electronic Data Interchange in Business Analytical Essay by Master Researcher

Electronic Data Interchange in Business
A discussion on the use of Electronic Data Interchange in the purchasing department of a business.
# 39501 | 900 words | 4 sources | MLA | 2002 | US


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Description:

This paper explains that Electronic Data Interchange (EDI) is the name of the direct, standardized computer to computer exchange of business documents, such as purchase orders, invoices, payments, and inventory analysis between trading partners. The paper discusses the advantages related to speed and accuracy and how it can be an automated system which maintains inventory over time. The paper also looks at its disadvantages such as concerns about the security of the documents that are transferred. The paper concludes that EDI is a viable approach for large companies but a less certain one for smaller companies.

From the Paper:

"Contemporary purchasing of supplies and other goods by one business from another business is often accomplished by using B2B, or business-to-business, selling methods and computer software. Electronic Data Interchange (EDI) is the name of the direct, standardized computer to computer exchange of business documents, such as purchase orders, invoices, payments, and inventory analysis between trading partners. This system has numerous advantages related to speed and accuracy, creating a clear record of the transaction and speeding deliveries. It can also be an automated system which maintains inventory over time. The system can also have disadvantages, such as concerns about the security of the documents that are transferred.
"EDI works much like the conventional mail system except that all transactions are conducted electronically. In this process, the buyer sends a request for a proposal, purchase order, or whatever document is needed to the manufacturer or distributor over computer lines. The electronic document is sent to a value added network (VAN), serving as an electronic post office. The VAN then sorts and stores electronic documents, allowing them to be retrieved by the receiver (meaning the manufacturer or distributor) at a later date. The same process operates in the other direction, receiving and storing the information flow in the opposite direction, from the manufacturer to the purchasing company. Each end of the system may want to receive the electronic documents immediately or periodically, such as daily, twice daily, or hourly (Hansen 14)."

Cite this Analytical Essay:

APA Format

Electronic Data Interchange in Business (2003, October 09) Retrieved September 29, 2022, from https://www.academon.com/analytical-essay/electronic-data-interchange-in-business-39501/

MLA Format

"Electronic Data Interchange in Business" 09 October 2003. Web. 29 September. 2022. <https://www.academon.com/analytical-essay/electronic-data-interchange-in-business-39501/>

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