ERP vs. EDI

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Summary:
This article is for those who might get confused between ERP and EDI. It shows you the difference between them.


Content:

ERP (Enterprise Resource Planning) is a type of a system to facilitate the flow of information through out all the business functions within the boundaries of the organisation and to manage all the interactions to outside partners. On the other hand, EDI is only a way of transmitting documents between organisations.

To illustrate, let's imagine ERP as a computer and EDI as a chat messenger such as Skype or Yahoo. With a computer (ERP in this example), you can do heaps of things such as browsing the Internet, sending emails, and editing Word documents. With a chat messenger (EDI in this example), you can send messages to your friends or even do video chats with them.

Having said that, I also agree we can use other methods for connecting to our friends such as emailing or faxing. So what is the particular of this EDI system? The difference between an EDI system and your Outlook is that computers can read and understand EDI messages whereas when you receive an order by emails or faxes, you then have to key in the order into your accounting software. However, with EDI, computers with EDI software can read those messages and convert them into sale orders directly without human intervention.

 
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