The pragmatics of electronic data interchange: The use of EDI will unify business procedures

Abstract

Electronic data interchange (EDI) is more than just the exchange of data. Each exchange has a purpose — to let the receiving organization act upon the message received. As in any communication it is a problem to assure that the sender's intentions are understood by the receiver and thus that the receiver's actions are conditioned by these intentions. The difference is that since the receiver of an EDI message is a program, these intentions must be anticipated to be programmed. Historically, each organization's procedures and applications have developed according to the needs of the particular business. This has led to large variations, even within the same industry. Human filters have traditionally been applied as interfaces between these applications. As a necessary prerequisite, EDI standards have been created to accommodate this variety and practically any variation of any message can be created. The problem arises when the parties want to automate the procedures connected with the exchanged messages. They must either extend their own applications in order to accommodate this variety or, as part of the exchange agreement, reduce the variations to those that can be dealt with and thereby standardize their way of doing business. Even for large organizations, the first choice is economically infeasible and the basic question is: who decides how to standardize? It is concluded that the present state of EDI, with hubs as the deciding parties and spokes doing what they must do to stay in business, has been inevitable and will continue in future. This is in contrast to the view of EDI as a universal infrastructure.