Moving the Information

The conventional wisdom says that EDI (electronic data interchange) is dead; they just haven’t dragged away the body yet. But the folks in the EDI trenches have a very different idea.

Take Doug Anderson, assistant vice-president of sales support for Kleinschmidt Inc. of Deerfield, Ill. Anderson chairs the transportation subcommittee of ANSI ASC X12 and is a member of the X12 steering committee. ANSI ASC X12 is a group that oversees EDI standards.

“The notion that EDI is not growing, especially for motor carriers, is a very false one,” Anderson says. “Sooner or later, everyone wants to do business with, say, Procter & Gamble and they have to do EDI.”

My-Tien Van, chief information officer at Livingston International, Canada’s largest customs brokerage, agrees.
“There are reasons why people want to replace EDI, many of them acceptable,” she says. “EDI has been around for a long time, so there is this feeling that it must be outdated by now, given how quickly software standards change. And EDI is difficult to use. On the other hand, it works, and when something is reliable, people have no desire to change. Look at what is happening with XML, a very good, very flexible standard. But you see it being translated into EDI sometimes. So for the next five years, I don’t see EDI going away.”

Anderson’s company is one that translates XML into EDI. Kleinschmidt, he explained, works between businesses-say shippers and carriers-taking data from one and passing it on to the other, often translating from one format to another in the process. The data represent standard business documents such as bills of lading, load tenders, shipment-status requests and invoices.

A motor carrier, for example, can send documents electronically to Kleinschmidt in whatever manner it prefers: via frame relay (an older data network); leased line (a dedicated phone line); through a dialup modem or over the Internet using FTP (file transfer protocol); or perhaps XML.

Kleinschmidt translates that data into the appropriate format, forwards it to a shipper, say P&G, and follows up to make sure the data was received. That follow-up, Anderson said, is part of what makes a VAN a “value-added network.”

Of course, P&G is hardly the only company that expects vendors to communicate using EDI, and demand for EDI services is expanding, not contracting or marking time, according to Anderson.

In the past, Anderson explained, carriers and other vendors to EDI clients often used software to code their documents into EDI. “You go out and buy a piece of software and run it on your PC to turn [your data] into EDI,” he said. “That is changing quite a bit.”

XML is a more recent phenomenon, spreading with the popularity of the Internet. Where EDI defines various standard forms in computer code, XML uses plain text to create “tags” that describe information fields such as name of consignee, delivery address, billing address, etc. The resulting forms can be displayed using browsing software. The tags can be edited using everyday word-processing software.

XML is easier to understand in some cases, he concedes, because people don’t have to learn EDI code.

“But then if you’re doing this computer-to-computer, you have to agree on both ends. What are the tags going to be? Will it be “first-space-name” or will it be “first-underscore-name,” or will it be ‘FN’?”

Similarly, Anderson acknowledged the ease of editing XML with word-processor software. “But if you’re going to be sending data back and forth on a regular basis,” he said, “you don’t want to have to do that. You want to automate the process, and the tools for EDI translations are pretty sophisticated. If somebody can tell us what the file is going to look like and let us know what the person on the other end wants, we can set up translation in less than two weeks, usually a couple of days.”

EDI isn’t difficult for those who already know it, Anderson explained. “Once you’ve learned it, you’ve learned it,” he said.

Meanwhile, Anderson said more customers are using software Kleinschmidt offers as an ASP (application service provider). Software that creates and manages documents, for example, runs on Kleinschmidt’s computer. The customer accesses the software over an electronic connection-the Internet, for example. The customer sees standard forms on his PC screens and fills in information as usual. But he need not buy or maintain his own software applications.

Of course, the data is translated immediately into the format the carrier’s customer requires, and in many cases, according to Anderson, that format is and will continue to be EDI.