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Electronic Data Interchange

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EDI has been under development in the U.S. in one form or another since the mid-1960s. In 1968, a group of railroad companies concerned with the quality of inter-company exchanges of transportation data formed an organization to study the problem and to improve it. This organization was known as the Transportation Data Coordinating Committee (TDDC).

At about the same time, individual companies such as General Motors, Sears and K-Mart were also addressing the inefficiencies of inter-corporate document movement by using their own electronic (but proprietary) systems with their major trading partners. By the mid 1980's, K-Mart's system- EPOS was being used by over 500 companies.

Where was the problem? The problem lay in the fact that each system was specific to the company that in a proprietary sense had no standard except. A hypothetical company in the late 1960s doing business with GM, Sears and K-Mart therefore needed three different system interfaces.

The story with the grocery industry was different. One EDI historical example is Super Valu, a large American grocery chain. Because they had to first deal with larger "within-the-company" EDI issues, they recognized early on the need for industry specific standards. They felt that a universal standard was impractical and unnecessary for the technology levels that were available and the extent of their needs.

In the 1970's, several industries sponsored a shared EDI system that they usually turned over to a third party network. In some cases, the shared system was developed by the third party for the group of common companies or industry trade group.

Examples of this early sharing include IBM IVANS, which the U.S. property and casualty insurance industry sponsored. Another was ORDERNET, sponsored by the pharmaceutical industry. These industry trade group systems had the same disadvantage as the company proprietary EDI system: they were standard, but limited in scope, and unable to communicate with other trade group EDI systems. (ORDERNET, for example, could not communicate with the transportation carrier's EDI system.) In 1973, the TDCC decided to develop a set of standards for EDI between companies and to invent a so-called "living standard"-ie: a standard that included standards on how to change the standards! This resulted in the first inter-industry EDI standard in 1975 covering air, motor, ocean, rail and some banking applications. What evolved included generic formats for general business ANSI X12 , first published in 1981; a WINS format for the warehouse industry; and a UCS format for the food and drug industry; and for TDCC.

European development of TRADACOMS, ODETTE and JEDI started around 1984. In 1985, work started on EDIFACT (EDI for Administration, Commerce & Transport), an international standard through the auspices of the United Nations.

Taken from Callero Management Information Services

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