Question
Asked Sep 5, 2019
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Describe the benefits and drawbacks of EDI.

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Expert Answer

Step 1

Electronic data interchange (EDI):

  • EDI is the electronic interchange of business information through a standardized format.
  • It is the medium which allows organizations to exchange information electronically as opposed to the traditional means of exchanging information through paper such as purchase orders and invoices.
  • There are technical standards in place for organizations to ensure that the facilitating parties find it easy to share information.
Step 2

Benefits of EDI:

  • EDI helps in lowering the operating expenditure by eliminating the cost of paper, printing and other associated activities.
  • EDI helps in speeding up the business process by reducing the time delays to a minimum.
  • Electronic processes are prone to less errors compared to manual processes.
  • Due to the minimization of errors the efficiency of the system increases.
  • It helps i...

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