Since its introduction in the 1960s, Electronic Data Interchange (EDI) technology has reshaped data communication between trading partners, streamlining transactions and boosting efficiency across industries.
However, many organizations still struggle with EDI validation, which verifies EDI documents meet specific format and data accuracy standards before they’re transmitted. Fortunately, EDI validation tools can help automate this process.
In this guide, we’ll explore how EDI validation works, its role in maintaining data accuracy and compliance, and the key tools that can simplify validation for your business.
What is EDI Validation?
EDI validation is the process of ensuring that electronic documents exchanged between businesses meet standards for compliance, accuracy, and integrity. EDI defines the format for documents like invoices, shipping notices, and purchase orders, allowing them to be shared seamlessly between partners.
Validation is a critical step in processing EDI files, catching errors that could disrupt production or misinterpret data. With EDI validation software, users can quickly and consistently verify files by referencing implementation guidelines in the Standard Exchange Format (SEF) to access EDI implementation guidelines. The SEF is then compared to the EDI file, flagging any discrepancies.
There are several EDI transaction standards that support structured data exchange across industries. Each standard sets out specific guidelines for document structure and codes, ensuring accuracy and consistency in data exchange. Here are two of the most common:
ANSIX12: Primarily used in North America, ANSIX12 facilitates communication between government entities and businesses.
EDIFACT: A globally recognized standard, EDIFACT is widely used in healthcare, e-commerce, and the automotive industry and has become instrumental in organizing complex supply chains.
5 Types of EDI Validation
The EDI validation process involves multiple checks to ensure that data exchanges meet specific standards. These validations are crucial for businesses that rely on EDI to maintain accuracy and meet compliance guidelines. Orderful’s cloud-based validation tools quickly spot and fix errors, helping your EDI exchanges run smoothly and without hiccups.
Common types of EDI validation include:
1. Business Rule Validation
This validation type ensures data meets business-specific conditions for structure, accuracy, and consistency. The process may involve validating business relationships, cross-referencing internal and external databases, and implementing data reconciliation routines. These steps help maintain alignment and prevent inconsistencies.
2. Syntax Validation
Syntax validation verifies the syntax and structure of EDI documents, confirming adherence to standards like ANSIX12 and EDIFACT. An online EDI validator examines each document segment for required elements, correct formats, specific data types, and the hierarchical structure between data segments.
3. Partner Agreement Validation
This validation confirms that exchanged documents comply with terms set in partner contracts and agreements. Using an EDI validator to align document structures with agreed terms supports smooth, standardized exchanges between parties.
4. Data Integrity Validation
Data integrity validation checks that documents are complete, accurate, and consistent. This may include verifying data lengths, EDI segment lists, and the correct population of mandatory fields, such as numeric values within the expected range and dates in the correct format.
It can also consist of verifying the population of mandatory fields with numeric values in the expected range and ensuring that dates are in the proper format.
5. Compliance Validation
Compliance validation checks that EDI documents meet industry-specific guidelines, which may involve product codes, pricing, or shipping standards. These compliance checks catch errors and non-compliance issues early, allowing businesses to address discrepancies before processing.
EDI Validation Rules
To meet the specific guidelines and EDI standards agreed upon by trading partners, document validation before transmission is a must. Here’s an overview of key EDItransaction validation rules:
Segments
An EDI message contains groups of related data elements called segments, often beginning with a 3-character identifier like BEG-01. These segments might include purchase order details, street addresses, or product numbers, and each line within an EDI flat file represents a segment.
Elements
Elements are individual items within the EDI document, marked by special character placeholders. For example, in invoices, elements include product names, prices, and quantities. These elements form the smallest building blocks in an EDI standard.
Relationships
Relationships exist when two or more linked elements are part of a segment. This rule has a conditional element — certain data elements appear only if others are present, highlighting dependency within the segment.
Loops
Loops are logical groupings of segments and subloops that connect with other segments. They can be mandatory or optional; loops beginning with a segment are typically mandatory. A loop may contain multiple segment types organized to fit specific document structures. For example, in an EDI purchase order, a loop might include a segment with buyer information followed by a series of item details (product ID, quantity, price) grouped together to capture the full order accurately.
Codelist
The EDI framework supports reading code lists from SEF files, helping to verify if a data element code is valid. This process aids businesses in identifying whether specific codes meet transaction requirements.
Get Expert EDI Validation For Data Accuracy
Wondering if your EDI data is as accurate as it could be? Check out Orderful - they deliver industry-leading EDI validation to improve data accuracy across all exchanges. By partnering with them, you’ll stay aligned with industry standards and streamline your processes for maximum efficiency. Book a demo with an Orderful expert to get started or reach out to our EDI specialists.