Where to Use XML

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EDI

EDI-based processes are prime candidates for improvements with XML. EDI is a standard definition (defined by ANSI or EDIFACT) of acceptable document structures for various types of business transactions. Document structures are defined for purchase orders, acknowledgments, invoices, and other transaction types.

Systems use EDI when they either generate a document in EDI format or receive and subsequently process an EDI document. EDI documents are intended to be transmitted from one business partner to another. In most cases, some data translation and reformatting is necessary so that EDI documents can be properly used by target systems.

Organizations called value-added networks (VANs) provide EDI-related services, such as secure and reliable document transmission services, business partner connections (that is, electronic access to your business partners), and document management (such as store and forward, translation, and logging). Examples of VANs are GE Information Systems (GEISCO), Sterling Commerce, and Harbinger.

To date, EDI standards have proved useful as well-defined data representation formats. However, their rigid structure (along with other issues, such as high implementation and transaction costs) has restricted the acceptance of EDI standards in many situations. Typically, EDI is employed as a data transfer mechanism between business partners only if the number of documents exchanged justifies the effort and the expense and both organizations have technically savvy IT organizations.

The XML language, combined with widely available Internet technologies, promises to radically change the way business documents are transferred between organizations. As you know, organizations are all interconnected today over the Internet. SSL (secure socket layer), encrypted digital signatures, and other technologies provide adequate transactional security for most situations. These technologies, coupled with XML's ability to combine flexible document content with well-understood document structure, enable organizations to confidently, effectively, and efficiently execute electronic business processes with a wide variety of business partners.

XML and EDI are not necessarily competitors of each other as potential solutions. An XML file can contain data that conforms to EDI content specifications, even if it does not conform to EDI's document structure specifications. All that is required is a suitable DTD. In fact, several initiatives are underway to do just that. EDI-based interface systems can easily wrap their documents in XML for external representation to business partners. The business partners can either process the documents directly or first convert the documents into a format suitable for a legacy EDI system.

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