EDI is nothing but Electronic data interchange. SAP will support EDI through Intermediate documents (IDOCS).
EDI (Electronic Document interchange) - EDI is the electronic exchange of business documents between the computer systems of business partners, using a standard format over a communication network.
EDI is also called paperless exchange.
Reduced Data entry errors
Reduced processing time
Availabilty of data in electonic form
Reduced inventories and better planning
Standard means of communications
Better business process
EDI has two process
1. Outbound process
2. Inbound process
1.Application document is created.
2.IDOC is generated
3.IDoc is transferred from SAP to Operating system layer
4.Idoc is converted into EDI standards
5.Edi document is transmitted to the business partner
6.The Edi Subsystem report status to SAP
1.EDI transmission received
2.EDI document is converted into an IDOC
3.IDOC is transferred to the SAP layer
4.The application document is created
5.The application document can be viewed.
concerning EDI concept in SD: the EDI concept is intended to realize the sales and distribution process completely automatically with the help of electronical documents. These documents are sent from one customer to another, are processed mostly on the background and give a possibility to realize the sales process extremely efficiently.
If MM-customer would like to purchase the goods then he creates the IDOC of type ORDERS and send it to SD-customer. On the SD-side the IDOC is processed via the function module IDOC_INPUT_ORDERS and creates the sales order. As confirmation the SD-side can send to MM-side the Order-Response IDOC (function IDOC_OUTPUT_ORDERS). The MM-customer can every thime send a change to the existiong order, then on SD side the ORDCHG IDOC will be processed. It can change the order like in VA02. The creation of the invoice can be made via IDOC of message type INVOIC (function IDOC_OUTPUT_INVOIC).
So, the process can be realized completely automatically between SD and MM partners with the help of IDOCs: ORDERS, ORDCHG, ORDRSP, INVOIC.
That's all concerning the SD-EDI.
Additional processes in SD, where EDI are used:
1) application of delivery schedules to the scheduling agreement: IDOC of type DELINS
2) creation of a delivery order to the scheduling agreement: IDOC of type DELORD
3) creation of external agent service delivery to scheduling agreement: IDOC of type EDLNOT
4) creation of credit advice / credit memo in the frames of self-billing: IDOCs of type GSVERF, SBWAP and for external invoice creation SBINV.
It is all processes which are realized in the SD module via EDI.