WHAT IS EDI?

EDI - `Electronic Data Interchange' - is the direct communication of trading messages between computer systems, using national and international telecommunications networks.

Electronic Data Interchange - also now increasingly often, and perhaps more accurately, referred to as Electronic Commerce - is not new. In the book trade as in other businesses computers and telecommunications networks have been used very successfully for many years to send orders from customers to suppliers. Sometimes these networks have been private systems set up by a single wholesaler or distributor. Sometimes they have been trade-wide national systems such as Centraal Boekhuis in the Netherlands, the Association of Danish Booksellers network, or Teleordering in the UK.

What these networks have in common is that they began fundamentally as closed systems using proprietary message formats. Today's EDI systems are different. They are open systems. They cover a much wider range of commercial messages. They use standard message formats, and, increasingly, standard communications protocols. They are international in scope.

Today's EDI systems and message standards have been developed by cooperative action across a wide range of industries - manufacturing, retail and distributive, and financial. Until recently, they had not begun to spread widely into the European book trade. Now, however, the book trade is beginning to benefit from these developments.

EDI trading messages can be as basic as orders and invoices, but EDI can also develop into a much more sophisticated information exchange, so that trading partners manage their whole supply chain more effectively.

Most organisations start using EDI simply to send orders and receive order responses. The next logical step may be to exchange electronic delivery notes and/or invoices and credit notes. Libraries are often particularly interested in receiving new title notifications, including basic cataloguing data, as EDI messages. Other financial messages such as statements and remittance advices may follow.

All these applications use EDI as a more efficient way of doing what every trading organisation - supplier or customer - must already do as paper transactions.

In many businesses, however, EDI has opened up new opportunities for trading partners to share fuller information about supply and demand, to the benefit of both parties. For example, major retail chains can send statistical information on current sales, stock levels and sales forecasts, which can help manufacturers to plan their production to meet demand as economically as possible. Electronic communication facilitates `just in time' delivery of new stocks, either for

manufacturing or for retail outlets.

Key elements in EDI are the application software at either end of the exchange, linked to EDI message handling software, linked to a communications network.

There are many network carriers available nationally and internationally, ranging from commercial value-added networks (VANs) specialising in EDI services to the INTERNET itself. Increasingly, the different networks are themselves interconnected.

There is plenty of commercially-available software for PCs or mainframes which will manage EDI communication. Many enterprises are using EDI very effectively with no more than a PC.

Paradoxically, the most important element is the application processing at each end of the EDI interchange. Experience shows that most of the hard work involved in the successful introduction of EDI comes in re-thinking and re-shaping internal procedures.

At its most basic, EDI increases the speed and accuracy of trading communication, and cuts costs.

A high proportion of trading documents such as orders and invoices are routinely produced by a computer system. It has been suggested that over 70% of documents produced in this way are keyboarded by the receiving party into another computer system. This process is costly and inefficient, and inevitably produces errors which were not present in the original documents.

Postal services vary in speed and reliability. EDI messages typically reach the receiver's mailbox within seconds. Arrival at their ultimate destination depends only on the frequency with which the receiver empties that mailbox.

Depending on the type of network service which is used, EDI can provide absolute confirmation that a message has arrived at its destination and been picked up from the receiver's mailbox.

Even the simplest application of EDI, doing no more than replacing a few basic transaction documents by their electronic equivalent, can reduce paper handling for both sender and receiver, increase the speed and security of transmission, provide a clear end-to-end audit trail, and ensure that messages reach the receiver's computer system

exactly as they left the sender's.

On individual transactions, the receiver may appear to benefit more than the sender. Across a complete trading cycle, both parties benefit by increased speed, accuracy and convenience, and reduced cost.

EDI will give you better and more up-to-date information on which to make business decisions if you are a publisher or bookseller, or budgetary commitments if you are a librarian.

The clearest and most basic demonstration in a book trade context is the simple replacement of paper orders and invoices by EDI orders, order responses and invoices. For the first time ever, the bookseller knows what he is going to receive from the publisher before the parcel arrives - and what he is not going to receive. He can inform his customers accordingly, and provide better service.

The librarian knows what he is going to receive from his supplier - and can find out much sooner what he is not going to receive. He can release money which he has committed to the order, and re-allocate it elsewhere.

EDI can link your business operations more closely to those of your key suppliers and customers, to the benefit of all parties in the supply chain.

For example, publishers know what stock is leaving their warehouses and going into wholesalers and retail stores. They do not know at what rate individual titles are selling to libraries and retail customers, or what quantity may still be on the shelves as potential future returns. One reprint too many will damage the profitability of even a relatively successful title.

EDI links between publishers, wholesalers and retailers offer the promise of much better information on sales and stock movements, better informed production decisions, and less wasted spending across the industry.

Books are sold not only in specialist bookshops, but also alongside other products in larger stores. A book trade and library EDI system must be compatible with other retail EDI systems.

Any publisher, bookseller or librarian will tell you that `books are different'. They are not `just another product'. They have a mystique and a cultural value which is entirely their own. This is true on one level, but on another level they are physical products which are ordered, shipped,

delivered, shelved, invoiced, sold and - hopefully - reordered, just like any other commodity.

Any retailer who sells both books and other merchandise - stationery, recorded music, toys and games, for example - will quite reasonably want to use compatible systems for trading with all his major suppliers.

The book world is increasingly international. A national book trade and library EDI system must communicate internationally.

Travel and tourism; language teaching; research and professional practice in medicine, science, engineering, economics, international law... These are all areas in which books and other information sources are increasingly international, and need to be served by booksellers and libraries which stock or know how to obtain publications from all over the world. The more remote the source, the greater the potential benefit of electronic communication.

Any national book supply system must fit into the developing pattern of international supply.

EDI messaging software can be costly to develop and maintain. Software packages to handle conversion and management of international standard EDI messages are widely available.

Managing EDI communication is not just a matter of setting up a message and sending it. It requires the management of trading partner relationships, the validation of incoming and outgoing messages, the scheduling of network communication sessions, the maintenance of backups and audit trails to meet both internal needs and those of relevant fiscal authorities.

Thanks to the investment which other industries have made in EDI systems, there is a lively competitive market in software packages which perform all of these functions and more, and which support message translation into and out of international standard formats.

Any book trade or library EDI system should plan to adopt EDIFACT, the international message standard. EDItEUR is preparing EDIFACT message formats for book trade and library use.

Yes, but will standards cost me more?

Some people are concerned that there are added costs in the adoption of international EDI message standards. It is true that, because the standards are designed to cover a very wide range of needs, it is almost always possible to devise a way in which a message which is limited to one specific application could be sent in fewer characters. This will affect communications costs. But the difference is not great, and communications costs are set to decrease dramatically in the foreseeable future, while all the costs associated with developing and maintaining a non-standard system are certain to increase.

Adopting the right standards always saves more money than it costs.

 Thankfully, most of us who become involved with EDI in the book world do not need to master the intricacies of the various message formats. However, it is useful to be aware of the relationships between some of the more important national and international standards.

In the USA and Canada, the BISAC and CBISAC groups pioneered the development first of a family of fixed-length BISAC formats for book trade transaction messages, and more recently their equivalents under the US X12 national EDI standard. BISAC is working closely with EDItEUR towards an eventual migration to a common set of EDIFACT standards. This will undoubtedly take time on the trade side, although several North American libraries and their systems and book suppliers are already using EDIFACT. EDIFACT standards are also already in use for international communication with North American book trade.

In the UK, Book Industry Communication (BIC) has produced book trade implementations of the UK national EDI standard TRADACOMS. BIC has already decided that any new messages will be developed in EDIFACT. Again, international communication from the UK is using EDIFACT, and there is already considerable national use between libraries and their suppliers.

There are other national EDI standards (eg GENCOD in France), but none appears to have been widely applied in the book trade.

There is every reason, therefore, to be confident that EDIFACT will be the worldwide standard for book trade and library EDI, as for other industry sectors.

But what is EDIFACT? It is emphatically not a simple, single, ready-made standard. It is best regarded as a syntax definition, backed up by a complex and wide-ranging directory of data elements, segments, messages and code lists, which provides an enabling framework for EDI application designers to use to meet the needs of a particular trading community.

EDIFACT is not static. New directories are produced year-by-year. New messages are added. For practical everyday use, any trading community needs a standard which will be stable over time, with a properly controlled approach to periodic upgrades. This is exactly what EANCOM provides, and what EDItEUR, collaborating with EAN International, now provides for the book world.

 There is a great variety of ways in which EDI messages can be communicated.

Some successful early applications have used magnetic media (tapes or disks) to transfer files of EDI messages physically from sender to receiver. Others were based on direct point-to-point communication between trading partners over the public switched telephone network or over private leased line links.

Today, trading partners are likely to be choosing one (or several) of a number of network options.

Value Added Networks (VANs) provide specialist support for EDI messaging, with various levels of security and audit trail from sender to receiver, and protection against unwanted `junk' messages. VANs are typically store-and-forward networks, where each user has a `mailbox' for incoming messages which he can collect at times of his own choice. This is in contrast to a direct telecommunications link, where both sender and receiver must be connected simultaneously in order for a message to pass between them.

The Internet - the worldwide network of networks which links an explosively growing community of academic, public sector and commercial users - is a low-cost option which, however, lacks the reliability and security of the major VANs. Software for supporting standard EDI message formats over the Internet is beginning to become available, and this can be expected to overcome the security problems. The Internet remains a loose confederation of networks, within which there is, and can be, no clear responsibility for ultimate delivery; but, by and large, it works.

The Integrated Services Digital Network (ISDN) which is being implemented by telecommunications providers in most parts of the developed world, is well-adapted to transmitting large files at very high speed. It will be an increasingly attractive option, either for direct end-to-end links or, perhaps more generally, as an efficient local link to a store-and-forward network.

The pattern which is developing worldwide is one of an increasing proliferation of networks but, at the same time, increasingly general interconnection between VANs, other commercial networks and the Internet.

For the individual user, the choice of a network, or networks, for EDI messaging should probably be based on two criteria:

INTERNATIONAL BOOK AND SERIALS EDI GROUP

EDItEUR is the International Book and Serials Sector EDI Group, recognised by the Commission of the European Union and by the Western European EDIFACT Board, and supported by the European Federations of Library, Booksellers and Publishers Associations (respectively EBLIDA, GALC and FEP). EDItEUR is a non-profit-making organisation, formally constituted as a company limited by guarantee.

Membership of EDItEUR is open to individual enterprises with an interest in EDI in the book trade, and to relevant associations. The Secretariat is housed at the offices of Book Industry Communication in London. EDItEUR is managed by a Board of representatives of the three European Federations responsible for creating the organisation and a Steering Group of members. The development and maintenance of the EDItEUR EDI Manual is the primary task of a Message Development Working Party.

EDItEUR maintains active liaison with national and international organisations, and in particular with the US Book Industry Study Group and its associated BISAC and SISAC committees, which deal respectively with EDI standards for books and serials.

EDItEUR EDI MESSAGE STANDARDS

Except in rare cases where the book world has a trading practice which is genuinely different, EDItEUR does not devise its own EDI message standards. What EDItEUR is doing is mainly to interpret and occasionally extend existing international EDI standards for application to the book trade and libraries.

Early in its deliberations, EDItEUR determined that it would wherever possible work within the EANCOM subset of EDIFACT message standards. EDItEUR has established a close working cooperation with EAN International, the Brussels-based body which coordinates the world-wide EAN article numbering and barcoding system. The book trade has worked with EAN for many years, on International Standard Book Numbering and on the barcoding of books.

EANCOM is a stable and well-documented subset of EDIFACT. It is the most widely-used `dialect' of EDIFACT in the international retail and distributive sector. By adopting EANCOM, the book trade will be using standards which are widely recognised in related sectors with whom trading communication may also be required. Through EAN, EDItEUR is able to keep in close touch with, and where necessary help to influence, wider EDIFACT developments.

Acknowledgement is made to the US Book Industry Study Group, whose own EDI Implementation Checklist was one of the principal sources for this section.

The purpose of this checklist is to identify the main steps which are likely to be involved in a successful first implementation of EDI. The elements in the list will not necessarily occur independently of each other, or in the sequence in which they have been grouped below. For example, the whole stimulus to embark on EDI may come from one or more existing trading partners, so that contact with trading partners may be the very first event to occur. Equally, the scope of the initial implementation must depend in part on the ability of trading partners to match what you would like to do, so that there will be an obvious interaction between activities in sub-sections 2 and 4.

1. MANAGEMENT
EDI is a process which involves many aspects of your trading activity, as supplier or customer. It cannot be introduced by one department working in isolation. It must have the understanding and support of top management and of all departments which are affected.1.1 Obtain commitment from key management.

1.2 Establish a plan.

1.3 Set up a project team.

1.4 Appoint a project manager.

1.5 Determine EDI business contact(s) within the company and at intended trading partners, and EDI technical contact(s) within the company, at EDI software and network service suppliers, and in intending trading partners' technical departments.

1.6 Ensure that staff involved in the project receive appropriate briefing and/or training in EDI concepts.

1.7 Identify legal issues for agreements with network service suppliers and with trading partners, and in respect of taxation authorities (eg VAT on invoices).

1.8 Monitor progress at all stages

2. SCOPE AND OBJECTIVES
It is important to start with a clear view of the scope of your first EDI project, and the benefits which you expect to get from it.

2.1 Decide what parts of the trading cycle you wish to handle by EDI, short and longer term.

2.2 Identify the benefits which you expect to obtain from EDI.

2.3 Determine implementation priorities, and hence the scope of your initial EDI project.

2.4 Identify prospective initial trading partners.

3. SYSTEMS PLANNING
To get the full benefits of EDI, it may be necessary or desirable to change existing business systems. In any event, existing data formats must be mapped on to the relevant EDIFACT standard messages, and interfaces developed between internal systems and the software which will convert messages to and from EDIFACT and manage the communications process.

3.1 Secure appropriate EDI reference materials (eg EDItEUR EDI Manual).

3.2 Review internal systems and business procedures.

3.3 Review data content of messages to be exchanged.

3.4 Determine what optional content will be required to meet your business needs.

3.5 Review EDI software options (inhouse development, third-party package etc).

3.6 Review communication options.

3.7 Prepare an overall system design and development plan.

4. TRADING PARTNER REVIEW
Agreement must be reached with initial trading partners on the scope and timing of EDI implementation, the communication option to be used, any features such as the use of optional data elements or code lists in the first set of messages, and how terms of trade will be applied when messages are sent electronically rather than on paper.

4.1 Review plans with selected trading partners.

4.2 Set up trading partner agreements.

4.3 Agree test procedures with trading partners.

5. SYSTEMS DEVELOPMENT AND TESTING
Having confirmed with trading partners the scope of the first implementation and the correctness of those aspects of the system design which relate directly to message content and communication, you will need to install, develop and test the software and network connections.

5.1 Determine network and software option(s) to be used, and contract with suppliers.

5.2 Train technical staff to use the chosen network and software.

5.3 Install, develop and test all necessary software, including modifications to existing internal business systems.

5.4 Implement network connection(s).

5.5 Conduct system test with network.

5.6 Conduct system test with network and trading partner.

5.7 Evaluate system test with trading partner and decide on cut-over to live operation.

6. LIVE OPERATION
Following cut-over to live operation with the initial trading partners, the next stages should include extending the first implementation to a wider group of suppliers and customers, and in due course moving on to the introduction of EDI for other parts of the business cycle.

6.1 Implement daily procedures for sending and receiving EDI transmissions.

6.2 Monitor success versus expected benefits.

6.3 Review procedures for future implementations.

6.4 Add more trading partners.

6.5 Plan extension of EDI to other trading messages.

This checklist may seem rather intimidating. It applies, of course, primarily to organisations which work on such a scale as to have their own technical staff and to take a large part of the responsibility for development and operation of inhouse systems.

Most individual booksellers and libraries will in practice rely on a turnkey system supplier who will have implemented an EDI capability as part of a general bookshop or library software package. In this event, almost all of the technical elements in the checklist can be ignored. The key issues of reviewing internal business processes and setting up arrangements with trading partners will still apply.