Electronic Data Interchange (EDI) is critical to operating a business in today’s information age. To maintain competiveness, electronic exchange of business information with suppliers, vendors and customers must be seamless.
Standards for the exchange of business information must be developed in order for this to happen. In the U.S., EDI standards are referred to as ASC-X12, which is also an organization chartered in 1979 by the American National Standards Association to develop uniform standards for electronic interchange of business transactions between different industries.
X12 standards establish a common, uniform language that facilitates transactions
ASC X-12, formally known as the Accredited Standards Committee, meets three times a year to develop and maintain the language. Collaborating with other organizations and stakeholders, ASC X-12 develops user-friendly standards that facilitate electronic business transactions like invoicing, payment collection, order processing, shipping and receiving information and moving data within and among various financial, insurance, education, state and federal government entities.
No matter if the two parties are in the next room or on opposite sides of the world, X-12 standards make it possible to conduct almost all business-to-business transactions between different computers. There are currently 275 unique transaction sets for common business activities in a wide variety of industries.
Five different subcommittees collaborate, publish and promote EDI standards for their particular area. Each subcommittee has industry representatives, an EDI specialist and other stakeholders who negotiate and build consensus during and after EDI X-12 development and publication. Subcommittees include:
- Communications and Controls (X12C) – Manages EDI architecture, data security, service specifications and control/management transaction sets. X12C also develops design rules and serves as X12’s liaison to related national and international organizations.
- Finance (X12F) – Develops and maintains standards related to financial remittance delivery, invoicing, payment transactions, credit cards, and even real estate and mortgage lending. X12F promotes the adoption of these standards across the financial industry.
- Government (X12G) – Develops EDI standards for all levels of government (federal, state, local) and private sector contractors. Transaction sets include contracting, vehicle fleet reporting, revenue reporting and voter registration to name a few.
- Insurance (X12N) – Develops and maintains EDI standards for all types of insurance (i.e. property, casualty, auto, health, life, annuity, reinsurance and regulatory reporting). X12N coordinates activities with insurance industry standards associations like HL7 and NCPDP.
- Transportation (X12I) – Develops standards for all forms of transportation along with logistics, multimodal transportation and U.S. Customs. This subcommittee consults with other recognized organizations that deal with EDI transportation standards.
The ASC-X12 committee strives to provide user friendly EDI solutions in a timely manner. Transaction sets are designed to support the maximum number of users as quickly and simply as possible. Their goal is to one day develop and implement a worldwide EDI standard.
Bookmark and check back soon with the knowledge center at Carnal Software to learn more about EDI and other standards that interconnect computer systems and streamline business processes.