Brochure

Parker Hannifin Corporation
Climate & Industrial Controls Group
Cleveland, OH
Catalog CIC-2003-1/US
Parker — Your Preferred Supplier
12
EDI — Electronic Data Interchange
Parker's information strategy has evolved into a
comprehensive hardware and software resource. We
will continue to use our EDI resource as an electronic
commerce tool to enhance our customer service
commitment.
Business Opportunities with EDI
With the increasing emphasis on customer service, EDI
provides the following benefits:
• Allows users to transmit standard and paperless
business transactions electronically.
• Increases accuracy and timeliness, resulting in
faster and more efficient transaction processing.
• Reduces transaction costs.
• Reduces inventory and storage.
• Helps solve delivery problems.
• Adds a competitive advantage perspective, and may
improve profits and market share by increased cash
flow and enhanced planning.
• Offers potential cost savings due to high industry
regard for EDI.
EDI is gaining as the preferred technology in receiv-
ables/invoicing and the totally paperless evaluated
receipts settlement (ERS). The invoicing module is
simply the creation of an electronic invoice following
shipment of the goods, which streamlines paper saving
and handling.
ERS goes even further in the payment of goods through
electronic funds transfer. Upon recognizing the receipt
of the material, the customer's computer recognizes
the obligation, and subsequently initiates a payment
funds transfer (EFT) from its bank to the vendor's bank
for payment without involving an invoice.
Launching an electronic invoice at the same time as the
product shipment creates an added benefit of advance
shipment notification. The distribution customer has
notice of in-transit material, and upon receipt may
initiate normal invoice processing.
The future of EDI calls for more time-sensitive trans-
actions, the elimination of edit problems or errors,
and less human intervention in business processing
functions.
Value-added Networks
Before information can be transmitted using EDI, data
from the sender/user must first be translated into a
standard format, and then communicated using the
standard format to a receiver. This communication
process takes place through either point-to-point
EDI (Electronic Data Interchange)Why Parker?
EDI (Electronic Data Interchange) is the computer
application-to-computer application communication of a
standard business transaction in a standard data format.
EDI users eliminate unnecessary paperwork by exchang-
ing information directly between computers and between
applications instead of by telephone, facsimile, or mail.
Previously, corporations used different computers and
systems, and the data communicated among these
computers had to be manually reformatted. Today, EDI
uses computer network technology to provide data
storage, translation, and transmission among business
partners. These services, which are not limited by hard-
ware or software differences, convert a sender's
speeds, codes, and document formats into forms
compatible to the receiver.
EDI was first implemented in the transportation industry
to help eliminate the large amounts of paperwork created
to move products and manage inventories. Before EDI,
the industry had to manually trace shipping requests
and instructions from manufacturers, distributors, and
customers. It has since been proven to be more effi-
cient and less costly for both customers and suppliers
to exchange such data electronically. Other industries
followed, and today EDI has widespread application
and is a key part of worldwide electronic commerce.
Although many of these trading partnerships have
incompatible data formats, Parker is able to link with
them because of the national EDI standards developed
by the American National Standard Institute's Accred-
ited Standards Committee X.12 (ANSI X.12). These
standards provide a common language and format, and
are supported by virtually all third-party networks and
translation software distributors. Parker also belongs
to the Automotive Industry Action Group (AIAG), the
Aerospace Industries Association (AIA), and other
trade associations that work to standardize and
organize the collective efforts of various manufacturers
and suppliers in the area of electronic data interchange.
Parker is especially well-poised to take advantage of
EDI linkages because of its "Gateway Concept," in
which Parker's internal communication network collects
and distributes information to the customer from a
single point. Conversely, customer transmitted informa-
tion can be received at a single point and distributed to
Parker divisions via the internal network. The Gateway
provides a single highway among all Parker divisions
and their customers, resulting in faster communication
speed, added convenience to customers, and substan-
tial cost savings for all parties involved.