EDI (Electronic Data Interchange) was developed in closed user communities boundaries. With electronic trade developed to cover wider trading relationships, there was a problem of trade between organizations using different EDI standards.
To solve the problem of cross sector trade and desire to use EDI for international trade, a common format was required for the exchange of the standard business forms like invoice, PO, order etc between organizations in different countries. To facilitate this cross sector of EDI, the EDIFACT standard has been developed in mid 1980’s. EDIFACT is the United Nations standard of Electronic Data Interchange for administration, commerce and transport.
As described by TEDIS , 1992 in his book “…..members of the American National standards Institute (ANSI) voted to stop to work on their domestic X12 EDI messages after 1997 and switch all their efforts to the international EDIFACT standards within the United Nations framework.”
The EDIFACT standard, like other EDI standards is about the exchange of electronic documents. For EDIFACT each document include invoice, order, dispatch advice and payment order. Other sectors will have their own documentation requirements, sectors using EDIFACT include:
- Social Administration
- Public Administration
- Public Procurement
For transmission purpose EDIFACT messages are sent electronically known as an interchange. Each EDIFACT message specifies a great number of data segment.
The EDI coding of the order provides a machine independent, unambiguous specification of the requirement that can be sent or accepted by any system with the appropriate EDI software.