Methodologies for Evaluating Investment in Electronic Data Interchange

Methodologies for Evaluating Investment in Electronic Data Interchange

Dothang Truong (Fayetteville State University, USA)
Copyright: © 2005 |Pages: 13
DOI: 10.4018/jeis.2005070104
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Abstract

Reluctance of organizations to invest in electronic data interchange (EDI, Internet-based EDI, and XML/EDI) is largely due to their inability to assess the return on these investments. We identify prescriptive and evaluative methodologies for analyzing investment in EDI: non-financial methods, purely financial methods, and financial and strategic consideration methods. We also show how computer simulation can be used as a tool for assessing EDI. Evaluating the benefits resulting from EDI implementation was illustrated through the well-known Beer Game. Our analysis and review also identifies difficulties involved in assessing the benefits of EDI in supply chains.

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