XML and EDI Lessons Learned and Baggage to Leave Behind
I first sensed Electronic Data Interchange (EDI) had a less than glorious future when I visited a printing plant in Des Moines, Iowa a few years ago. This company, with about 120 employees, was one of the most innovative I have ever seen. It implemented the Deming continuous process improvement methods seriously, tracked its jobs meticulously, looked after the welfare of its staff, and grew quickly as a result. Yet the company had only one information systems person on staff and would not even consider implementing EDI. Why not? EDI took too long to implement, required expensive networks and software, and provided little in the way of benefits for a company this size.
This company's experience is hardly unique. Many smaller companies using EDI today do so only because their bigger customers demand it, a business model called hub-and spoke. If your company is the hub, the system works fine. But if you are the spoke it presents an enormous cost of doing business.
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"The XML community has a chance to fashion new forms of business data exchange where even the smallest companies can benefit." |
As a result, XML has an opportunity to fill the gap for companies like this printer and millions of others like it. The XML community has a chance to fashion new forms of business data exchange where even the smallest companies can benefit, and XML is the key. Charles Goldfarb and Paul Prescod, in The XML Handbook (Prentice-Hall, 1998) outline the problem with traditional EDI and the opportunity for a new EDI based on XML (page 103)…
"Traditional" EDI is based on outdated principles that will cause it to fade into technological obscurity, as it becomes embraced and replaced by the "New" EDI. Traditional EDI refers to the use of rigid transaction sets with business rules embedded in them. This model simply does not work in today's rapidly changing business environment.
This problem is compounded by the fact that companies have chosen to interpret these transaction set standards in ways that suit their unique business requirements. As a result, vendors who engage in EDI with multiple customers typically must create a unique solution to handle the transaction sets for each company. This makes the implementation of EDI far too expensive, especially for [Small and Medium size Enterprises] SMEs.
While EDI may deserve these criticisms, the XML world may want to build on the 30 years of EDI rather than tearing it all down. XML needs a lot of the EDI experience, for all of its warts, to make business data exchanges and the benefits derived from them a reality. If companies want to exchange business data to help reduce inventories, get products faster to market, create closer coordination between manufacturing and distribution, and provide more choices for consumers, EDI has lessons to help get there.
