EDI – Electronic Data Interchange

Think of EDI as a digital postman for business documents. Instead of sending papers by mail, fax,
or email (which someone has to re-type), EDI sends data directly from one company's computer
system to another's.

· Traditional Methods: Email, Fax, Phone, Postal Mail → Requires manual data entry.
· EDI Method: Computer-to-computer transfer → No manual typing needed.

What is EDI?

· It’s the automated, standard electronic exchange of business documents (like orders or
invoices) between organizations.
· Both the sender and receiver must agree on a common digital format for the data.

How EDI Works & Its Benefits

The Problem with Paper (Traditional Methods):

1. Slow: Takes a long time to send, receive, and process.

2. Error-Prone: Manual data entry leads to mistakes.
3. Expensive: High labour and material costs.
4. Uncertain: You never know when a document will arrive or if it's correct.

How EDI Solves This: Special translation software on the sender's computer converts the data
into a standard EDI format. It's sent over a network, and the receiver's translation software
converts it back for their system. No human typing is needed in between.

Benefits of EDI:

· Direct Benefits:
– Saves time and money
– fewer errors
– faster document movement
– better customer service

· Strategic Benefits:
– Lowers product costs
– improves supplier/customer relationships
 – allows for better business planning using accurate, timely data.

Drawbacks of EDI

1. Can be expensive to set up initially.

2. Historically required special, costly networks called VANs.
3. Can be complex to learn and implement.
4. Less flexible than modern web-based options.

Components of an EDI System

1. EDI Standards: The agreed-upon rules (like a common language), e.g., EDIFACT.

2. EDI Software: Has four parts:

· Application Software: Your business program (e.g., accounting software).
· Translation Software: Translates data to/from the EDI standard.
· EDI Service Software: Manages the sending/receiving.
· Network Software: Connects to the communication network.

3. Network Infrastructure: The path the data takes (Private network, VAN, or the Internet). VANs
use an "electronic mailbox" to store and forward documents.

Financial EDI (FEDI)

This is EDI for money. It’s the electronic movement of payment information between banks,
replacing paper checks.

· EFT (Electronic Funds Transfer): Direct, computer-based money transfers between bank
accounts. It's fast and certain.
· ACH (Automated Clearing House): Used for transactions like payroll deposits (direct deposit)
or automatic bill payments.

Supply Chain Management (SCM)

A supply chain is the entire journey of a product: from buying raw materials, to manufacturing, to
distribution, and finally to the customer. The goal of SCM is to manage this entire flow efficiently.

SCM Objectives:

1. Get the right product to the right place at the right time for the lowest cost.
2. Keep inventory levels as low as possible.
3. Shorten the time between a customer's order and its delivery.

Components of Supply Chain Management (SCM)

1. Supplier Management: Selecting and managing reliable providers to ensure a steady, cost-
effective flow of materials.
2. Inventory Management: Controlling stock levels to minimize holding costs while meeting
customer demand.
3. Distribution Management: Overseeing the physical movement of goods to ensure efficient and
timely delivery to customers.
4. Channel Management: Distributing critical information to partners to keep the entire supply
chain aligned.
5. Payment Management: Automating financial transactions to accelerate payments and reduce
processing costs.
6. Sales Force Management: Integrating the sales team with other departments to improve
information flow and forecasting.

Two SCM Models:

· Push-Based (Traditional): Companies produce goods based on forecasts (predictions). This

often leads to too much or too little stock. Relies on manual processes.

· Pull-Based (Modern): Companies produce goods based on actual customer demand. This is
enabled by technology (like EDI) and JIT manufacturing. It’s automated and efficient.

Just-in-Time (JIT) Manufacturing

JIT means materials and parts arrive at the factory exactly when they are needed for production,
not before or after.

Benefits:

· Drastically reduces inventory storage costs.

· Suppliers only send materials when there is a confirmed demand.
· Improves product quality by identifying problems quickly.

E-Procurement

This is using web-based systems to automate the buying process within a company.

It moves procurement from paper forms and slow approvals to a fast, online system. A good e-
procurement system:

· Lets employees select items from approved online catalogs.

· Manages approval workflows automatically.
· Integrates with existing finance software.
· Tracks every purchase for full visibility and control.

M-Commerce (Mobile Commerce)

M-Commerce is doing e-commerce on the go using mobile devices like smartphones and
tablets.

it's popular because phones are now powerful communication and computing devices. The key
feature is mobility – you don't need to be in a fixed location.

Key Success Factors:

1. Urgency: Services needed immediately (e.g., checking bank balance).

2. Convenience: Easy to do anywhere (e.g., buying music).

3. Location-Based: Services that use your location (e.g., finding a nearby restaurant).

Applications: Mobile banking, advertising, ticket booking, app purchases, etc.

Key Infrastructure Differences from E-Commerce:

1. Wireless Devices: Smartphones with WiFi, Bluetooth, GPS.

2. Microbrowsers: Special browsers for small screens.
3. WML/WAP Gateways: Technology that converts standard web pages (HTML) into a mobile-
friendly format (WML) so they can be displayed on phones.

M-Commerce Limits & Security

Limitations of Mobile Devices:

– Small screens
– limited power
– less memory
– shorter battery life
 – sometimes slower networks

Security:

The main job of security is to ensure four things:

WTLS: A security layer for wireless connections that provides privacy and authentication.

Security services provided by the WTLS are:

– Privacy
– Server Authentication
– Client Authentication
– Data Integrity

Key Concerns:
– Secure Identification: Ensuring only the real owner can use the device for payments.
– Safe Storage: Protecting passwords and credit card info stored on the phone.
– Network Access: Preventing unauthorized devices from connecting to the payment
network.
– Data Transfer: Keeping information private and unaltered during transmission.
– Content Protection: Controlling how downloaded content (e.g., music, apps) is used.

Mobile Technologies & Terms

This is the "language" phones use to talk to networks. Key types include:

· GSM: The most common global standard (uses a SIM card).

· CDMA: A different standard used by some carriers, mainly in the US.
· 3G / 4G / 5G: Generations of network technology. Each new "G" is significantly faster.
· Wi-Fi (802.11): High-speed wireless internet for short ranges (homes, cafes).

Generation What it Did Example Speed

2G Digital calls & SMS GSM Very Slow
3G Basic mobile internet CDMA2000 Slow
4G Real mobile internet & video LTE Fast
5G Ultra-fast speed & new apps Very Fast

· Key Characteristics:
· Mobility: You can use the device anywhere.
· Broad Reach: You can be reached anytime.
· Basic Terminology:
· PDA/Smartphone: The handheld computer.
· SMS/EMS: Text and multimedia messaging.
· WAP: Early mobile internet protocol.
· Wi-Fi: High-speed wireless internet access.
· GPS: Finds your location using satellites.

Common Applications
– Mobile banking and payments like jazzcash and easypaisa
– Location-based services (e.g., finding a nearby store)
– Real-time inventory tracking for field workers
– Instant ticket booking and travel updates