A Model of EDI Integration and Strategic Business Reengineering

Abstract

Early research into electronic data interchange (EDI) stressed the greater speed, efficiencies and cost savings available from electronic document exchange. Despite EDI's cooperative focus, much of this research also described the technology as a competitive weapon for user organizations. Wider experience with EDI suggests, however, that rather than looking for short-term competitive advantages from EDI, it is in the areas of systems integration and business reengineering that EDI offers its greatest real benefits. This integration enables EDI to support a truly strategic approach to business, offering major comparative advantages to organizations, business groups, industry sectors and trading blocs. This paper develops a model of EDI integration as a series of four standard and recurring stages and then considers the case of a major Western Australian public sector organization which is in the process of making EDI a vehicle for business reengineering (the final stage). It also links this case study with current research into organizational growth and transformation. This research suggests that only organizations sufficiently mature to take a holistic view of information technology are likely to gain the comparative advantages which information technology offers. Building on this research, the paper suggests that, although EDI itself is a comparatively simple application in technological terms, the implications of its strategic use as an enabler of major organizational restructure and business reengineering are profound.