EDI replaces emailed spreadsheets and manual data entry with a fixed format both systems already understand. A retailer's warehouse system might receive an EDI 214 shipment status update automatically from a carrier, or an EDI 810 invoice from a supplier that posts straight into the ERP without anyone retyping it.
The limit is that EDI is rigid by design. Every document follows a numbered standard, such as the ANSI X12 set used widely in North America, and a small formatting mismatch between trading partners can reject a whole batch. Newer integrations increasingly pair EDI with APIs, using EDI for the documents partners already expect and APIs for anything more flexible.