How can you distinguish between EDI and XML?
If you work with electronic data interchange (EDI), you may have heard of XML, another format for exchanging data between different systems. But what are the differences between EDI and XML, and how can you tell them apart? In this article, you will learn the basics of both formats, their advantages and disadvantages, and some tips to distinguish them in practice.
EDI stands for electronic data interchange, a method of exchanging structured data between different parties using standard formats and protocols. EDI is widely used in various industries, such as retail, logistics, healthcare, and finance, to automate business processes and transactions. For example, an EDI invoice can contain information such as the sender, the receiver, the products, the prices, the quantities, and the payment terms, all in a predefined format that can be easily processed by the receiver's system.
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Sandeep Shankar
Technical Solutions Delivery Manager @ OSP | US Healthcare | SME
EDI can be thought of as an interface that enables interoperability between disparate systems to exchange specific information. For Eg, in the healthcare domain, one use case is to send Claims Information to Payers(EDI 837) and receive EOB information from Payers(EDI 835).
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Mark Elliott
Principal at CSG Government Solutions
As noted in the provided description, EDI is a methodology for data interchange and is often equated to the more rigid construct of delimited data fields combined into segments that are in turn assembled together into messages. The structure was a necessity in an era with the need to keep data exchange as brief as possible due to limited transmission speed and storage capacities. You could know the definition of the data read after the nth occurrence of a delimiter or following the cryptic 2 character field identifier because a rigid definition was established in an implementation guide. In was born in an era when COBOL was the mainstay of business applications.
XML stands for extensible markup language, a general-purpose language for creating and defining tags and attributes that describe the structure and meaning of data. XML is not tied to any specific industry or application, but rather allows users to create their own custom formats and schemas that suit their needs. For example, an XML invoice can contain the same information as an EDI invoice, but with different tags and attributes that the user can define and modify.
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Mads Brochorst Grønborg
XML is a syntax which enables data to be structured in a way that is easy to use by anyone with a need to dive into the data contents. Being a syntax, there are no rules how to structure ie an invoice. When a structure is defined (a schema) and some validation rules are added (a schematron) to define how ie an invoice must be presented as XML, that XML invoice may be considered as an EDI invoice in XML format. Example is the European PEPPOL standards.
EDI has several advantages over other data exchange formats, such as being standardized and widely accepted by many industries and organizations, which facilitates interoperability and compliance. It is also efficient and reliable, reducing errors, delays, and costs associated with manual data entry and paper documents. Moreover, EDI is secure and confidential, using encryption and authentication mechanisms to protect the data from unauthorized access and modification.
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Mark Elliott
Principal at CSG Government Solutions
Legacy EDI formats are not inherently secure and confidential, but often can be made so more easily than XML; encryption and authentication is not required by EDI. However, because the easily readable XML tags are not present in legacy EDI data exchanges, more specialized knowledge is necessary to decipher the legacy EDI data.
XML has several advantages over other data exchange formats, such as its flexibility and adaptability, allowing users to create and modify their own formats and schemas without depending on predefined standards or protocols. It is also readable and understandable, using human-readable tags and attributes that describe the data and its meaning. Furthermore, XML is compatible and scalable, able to be transformed and integrated with other formats and technologies, such as HTML, JSON, and web services.
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Mark Elliott
Principal at CSG Government Solutions
As noted, when used as an alternative to legacy forms of EDI, XML provides a much more free form and self-explanatory means of exchange. Features of XML such as human readable tags can make it much easier for someone with basic understanding of the data being exchanged to read and comprehend it without needing to know the full definition of the implementation rules. In addition, new data tags can be introduced into the XML data stream without as much risk of disrupting existing processes that may not need the data identified there.
EDI may have some drawbacks compared to other data exchange formats. It can be complex and rigid, as users must adhere to strict rules and specifications that may not be suitable for their requirements. Additionally, EDI is costly and time-consuming, as users must invest in specialized software, hardware, and network infrastructure to implement and maintain EDI systems. Furthermore, it is prone to compatibility issues, as it may not support certain data types or features available from other formats or technologies.
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Sandeep Shankar
Technical Solutions Delivery Manager @ OSP | US Healthcare | SME
Actually, I feel the rigid structure is what makes it a standard interface. Without rigidity, one cannot emphasize the members to follow the standard, similar to Strict Type checks in programming languages.
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Mark Elliott
Principal at CSG Government Solutions
It is often perceived that complex structure is a bad thing, but it is a big part of what can minimize costs of EDI when compared, so I'm not certain that it can be fairly said that legacy EDI is more costly and time-consuming than XML. It's just the distribution of costs and time consumption that are different between them. Software and hardware infrastructure investment will almost always be necessary regardless of the data format when considering the exchange of large volumes of data.
(edited)
XML, while a popular data exchange format, has some drawbacks. It is verbose and redundant, with many tags and attributes that can increase the size and complexity of the data. Additionally, it is inconsistent and ambiguous, allowing users to create and modify their own formats and schemas without following any standard or validation rules. Furthermore, XML has no built-in security or encryption features to protect the data from unauthorized access or modification, leaving it vulnerable and exposed.
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Mark Elliott
Principal at CSG Government Solutions
I find it interesting that the provided descriptions of EDI and XML disadvantages both identify complexity... either the structure or the data. And as I have noted above, EDI doesn't have to implement security or encryption features, so that isn't a fair disadvantage to impose on XML.
One way to distinguish EDI and XML is to look at the file extension and the content of the data. EDI files usually have extensions such as .edi, .x12, or .edifact, while XML files usually have extensions such as .xml, .xsd, or .xsl. EDI files usually contain data in a fixed-length or delimited format, with segments, elements, and qualifiers that follow a standard syntax, while XML files usually contain data in a nested or hierarchical format, with tags, attributes, and values that follow a user-defined schema. For example, an EDI invoice may look like this:
ISA*00* *00* *ZZ*SENDERID *ZZ*RECEIVERID *210531*1600*U*00401*000000001*0*P*>~
GS*IN*SENDERID*RECEIVERID*20210531*1600*1*X*004010~
ST*810*0001~
BIG*20210531*INV123*20210530*PO123~
N1*ST*ACME Inc.*92*1234567890~
IT1*1*10*EA*100*IN*SKU111*UP*123456789111~
TDS*100000~
SE*6*0001~
GE*1*1~
IEA*1*000000001~
An XML invoice may look like this:
<invoice>
<sender id="SENDERID"/>
<receiver id="RECEIVERID"/>
<date>2021-05-31</date>
<number>INV123</number>
<reference>PO123</reference>
<items>
<item>
<quantity>10</quantity>
<unit>EA</unit>
<price>100</price>
<type>IN</type>
<sku>SKU111</sku>
<upc>123456789111</upc>
</item>
</items>
<total>1000</total>
</invoice>
Another way to distinguish EDI and XML is to look at the benefits and drawbacks of each format and decide which one suits your needs and goals better. EDI may be more suitable for you if you need to exchange data with partners that use the same standards and protocols, and if you value efficiency, reliability, and security over flexibility and readability. XML may be more suitable for you if you need to exchange data with partners that use different formats and technologies, and if you value flexibility, readability, and compatibility over complexity and cost.
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Pieter Schipperus
Senior Manager EDI at Imperial logistics International - a DP World company
By exchanging XML messages you are doing EDI (electronic data interchange). So, it is not so much about distinguishing between EDI and XML, but is more about deciding if EDI can be of advantage to you. EDI is also about connecting processes of different business. Which standard (EDIFACT, X12, cXML etc.) will be used for the EDI is depending on many parameters such as branch or the industry you are working in.
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Xander Barnard
EDI Technical Officer at Vodacom
Because EDIFACT is a clear EDI message standard containing specifications and values your translation from and to EDIFACT can be standardised. Meaning you can work of a core translation already in place making timento market a lot shorter. With XML especially unique by design XMLs not using a standard as in the case of GS1 development and understanding of the XML, Structure and data could extend your development time. However. EDIFACT can sometimes put you in a box of rigit formats and validations which could hinder the partner especially with a low understanding of EDIFACT
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