Lead Time Reduction: Paperless Document Transfer.

"Lead Time Reduction" method: the paperless electronic document transfer between companies, where the receiving computer can interpret the document without human involvement.

EDI means Electronic Data Exchange.

The advantages of using EDI are:

administrative work is reduced

manual data entry is minimized

paper, printing and postage costs are reduced

accuracy is improved

speed is increased

information transmission is secure However, EDI also has some major drawbacks:

EDI is expensive

high implementation investment

high transaction costs: most EDI traffic flows over VAN's (Value Added Networks), which have high bandwidth costs

high maintenance costs

high cost to accomodate new customers and vendors

EDI is complicated

trained IT people are needed Then in 1995, the Internet came.

But Internet was not a good solution for paperless electronic document transfer, because it is

not structured

not secure enough

However, with the introduction of XML (eXtensible Mark-up Language), Internet can become an EDI communications backbone (instead of VAN's), because XML is a universal format for structured documents and data on the Web, and makes

structured information communication and

secure transport of data and documents between computers

possible.

Combining the best features of traditional EDI with the improvements in technology offered by XML is now the challenge.

Also small companies can then profit from this technology.