Enterprise information system - Dr. Muchelule
CSC318: ENTERPRISE RESOURCE PLANNING NOTESTABLE OF CONTENTS TOC \o "1-3" \h \z \u ENTERPRISE RESOURCE PLANNING PAGEREF _Toc29973788 \h 5Introduction PAGEREF _Toc29973789 \h 5The Driving Force behind ERP PAGEREF _Toc29973790 \h 7Implementing ERP System PAGEREF _Toc29973791 \h 8Advantages of ERP System PAGEREF _Toc29973792 \h 8Disadvantages of ERP System PAGEREF _Toc29973793 \h 8Conclusion PAGEREF _Toc29973794 \h 8Enterprise information system PAGEREF _Toc29973795 \h 15Purpose PAGEREF _Toc29973796 \h 15Design stage PAGEREF _Toc29973797 \h 15Information systems PAGEREF _Toc29973798 \h 15Enterprise planning system PAGEREF _Toc29973799 \h 15Survival PAGEREF _Toc29973800 \h 16Competition PAGEREF _Toc29973801 \h 16Opportunities PAGEREF _Toc29973802 \h 16Vulnerabilities PAGEREF _Toc29973804 \h 16Strategic planning PAGEREF _Toc29973805 \h 16Strategy via analysis PAGEREF _Toc29973806 \h 17Strategy via geography PAGEREF _Toc29973807 \h 17Strategy via projects integration PAGEREF _Toc29973808 \h 17Planning and budgeting PAGEREF _Toc29973810 \h 17Classifications PAGEREF _Toc29973811 \h 18Group planning PAGEREF _Toc29973812 \h 18Transition plan PAGEREF _Toc29973813 \h 19Planning software PAGEREF _Toc29973814 \h 19Overview PAGEREF _Toc29973815 \h 19Tools and methodologies PAGEREF _Toc29973816 \h 20Practical methodologies and frameworks PAGEREF _Toc29973818 \h 21RIIM and Power Scope PAGEREF _Toc29973819 \h 21Velox framework PAGEREF _Toc29973820 \h 21Velox ERM is a product of Technology Partnerz.?It integrates ONA -?organizational network analysis,[3]?process re-design,?IS/IT strategy,?change management,?supplier relationship management,?customer relationship management, and?risk and business continuity management?into a comprehensive and simple framework that supports people and organizations in repeatable/consistently: PAGEREF _Toc29973821 \h 21TRANSACTION PROCESSING PAGEREF _Toc29973822 \h 21Transaction Processing PAGEREF _Toc29973823 \h 21Transaction Processing Monitor (TPM) PAGEREF _Toc29973824 \h 22Asynchronous Transfer Mode (ATM) PAGEREF _Toc29973825 \h 22Advanced Business Application Programming (ABAP) PAGEREF _Toc29973826 \h Enterprise Server PAGEREF _Toc29973827 \h 23Enterprise Application Integration (EAI) PAGEREF _Toc29973828 \h 24The Major 4 Drivers of EAI PAGEREF _Toc29973829 \h 25Types of EAI PAGEREF _Toc29973830 \h 25EAI and Middleware PAGEREF _Toc29973831 \h 26EAI and XML PAGEREF _Toc29973832 \h 26The Advantages of Enterprise Application Integration: PAGEREF _Toc29973833 \h 27The Main Challenges of Enterprise Application Integration: PAGEREF _Toc29973834 \h 27Patterns PAGEREF _Toc29973835 \h 28Topologies PAGEREF _Toc29973836 \h 28Technologies PAGEREF _Toc29973837 \h 28Communication architectures PAGEREF _Toc29973838 \h 29Implementation pitfalls PAGEREF _Toc29973839 \h 30System Integration (SI) PAGEREF _Toc29973840 \h 31Business Transaction PAGEREF _Toc29973841 \h 31Process of Transaction PAGEREF _Toc29973842 \h 32Read Operation PAGEREF _Toc29973843 \h 32Write Operation PAGEREF _Toc29973844 \h 32ACID Properties PAGEREF _Toc29973845 \h 32Serializability PAGEREF _Toc29973846 \h 33States of Transactions PAGEREF _Toc29973847 \h 34Lock-based Protocols PAGEREF _Toc29973848 \h 35Simplistic Lock Protocol PAGEREF _Toc29973849 \h 35Pre-claiming Lock Protocol PAGEREF _Toc29973850 \h 35Two-Phase Locking 2PL PAGEREF _Toc29973851 \h 36Strict Two-Phase Locking PAGEREF _Toc29973852 \h 36Timestamp-based Protocols PAGEREF _Toc29973853 \h 37Timestamp Ordering Protocol PAGEREF _Toc29973854 \h 37Thomas' Write Rule PAGEREF _Toc29973855 \h 38Advantages of Concurrent Execution of Transaction PAGEREF _Toc29973856 \h 384.2 Creating your company file PAGEREF _Toc29973857 \h 534.3 Creating your customer and vendor list PAGEREF _Toc29973858 \h 545.1 Getting Around QuickBooks PAGEREF _Toc29973859 \h 565.2 Finding your data in QuickBooks centers PAGEREF _Toc29973860 \h 575.3 Using in-product Help PAGEREF _Toc29973861 \h 596.1 Working with QuickBooks lists PAGEREF _Toc29973862 \h 617.1 Creating an Estimate PAGEREF _Toc29973863 \h 777.3 Entering sales receipts PAGEREF _Toc29973864 \h 797.6 Paying Bills PAGEREF _Toc29973865 \h 827.7 Writing Checks PAGEREF _Toc29973866 \h 847.9 Paying Employees PAGEREF _Toc29973867 \h 877.10 Using Reports PAGEREF _Toc29973868 \h 89CSC318: ENTERPRISE RESOURCE PLANNING COURSE OUTLINE -13525589535Course Code: CSC 318Title: Enterprise Resource Planning Course Lecturer: Dr. Muchelule Yusuf, PhD Contacts:- cell: +254 701952124e-mails: ymuchelule@,ymuchelule@umma.ac.ke, yusuf.muchelule@jkuat.ac.ke Lecture Time: Course PurposeThis course introduces the fundamental principles of enterprises resource application in business, the ERP design, and implementation and monitoring Course ObjectivesAt the end of the course, the student should be able to:1. Identify the role of business wide systems to support the business strategy;2. Identify the main suppliers, products and application domains of enterprise wide packages; understand the scale and complexity of enterprise system packages;3. Understand the integrative role of enterprise systems for information within the organizational context;Course DescriptionWeek1: Overview of enterprise systems:Week2: role of Enterprise SystemsWeek3: IT infrastructure Week4: issues in ERP management and deployment, impact of issues in ERP implementation, Week5: ERP system administration: performance monitoring, Week6: CAT 1Week7: TPSWeek8: Concurrency controlWeek9: implementation and design practices for enterprise performance measurement and monitoring systems.Week10-12: ERP Practical’s (ms- project and quickbooks) Week13: CAT 2 and Group work assignment presentations Week14-15: revision and exams Teaching Methodologies: Lectures, practical and tutorial sessions in Computer Laboratory, individual and group assignments, exercises and project workInstructional Materials/equipmentWhiteboard, Computers and Internet, Database management systems and tools including DB2, ORACLE, Informix, IBM Data Studio.Course Assessment: Cats, class and group 30%Main examination 70%.Course Text BooksMagal, S. R., & Word, J. (2011). Integrated Business Processes with ERP Systems. Hoboken, NJ: JohnWiley& Sons, Inc.Magal, S. R. & Word, J. (2009). Essentials of Business Processes and information Systems. New York:Wiley& Sons.Reference booksMonk, Wagner. (2006). Concepts in Enterprise Resource Planning. Second Edition. Boston: ThompsonCourse JournalsJournal of Enterprise Resource Planning StudiesOxford Journals: The Computer JournalComputer Science Journals (CSC Journals)-59055103505Lecturer In-Charge:Lecturer Sign:……….………………………..…..Date:………………….Approved for CirculationName………………..............Sign…………………...Date…………………Chairman, Department of Computer Science (Official Stamp)Name………………..............Sign…………………...Date…………………Dean, School of Business and Technology (Official Stamp) ENTERPRISE RESOURCE PLANNINGIntroductionIn any industry, some of the demands managers face is to be cost effective. In addition to that, they are also faced with challenges such as to analyze costs and profits on a product or consumer basis, to be flexible to face ever altering business requirements, and to be informed of management decision making processes and changes in ways of doing business. However, some of the challenges holding managers back include the difficulty in attaining accurate information, lack of applications that mimic existing business practices and bad interfaces. When some challengers are holding a manager back, that is where Enterprise Resource Planning (ERP) comes into play.Enterprise resource planning (ERP) is the planning of how business resources (materials, employees, customers etc.) are acquired and moved from one state to another. An ERP system is based on a common database and a modular software design. The common database can allow every department of a business to store and retrieve information in real-time. The information should be reliable, accessible, and easily shared. The modular software design should mean a business can select the modules they need, mix and match modules from different vendors, and add new modules of their own to improve business performance.Over the years business applications have evolved from Management Information Systems with no decision support to Corporate Information Systems, which offer some decision support to Enterprise Resource Planning. Enterprise Resource Planning is a software solution that tackles the needs of an organization, taking into account the process view to meet an organization's goals while incorporating all the functions of an organization. Its purpose is to make easy the information flow between all business functions within the boundaries of the organization and manage the organization's connections with its outside stakeholders.In a nutshell, the Enterprise Resource Planning software tries to integrate all the different departments and functions of an organization into a single computer system to serve the various needs of these departments. The task at hand, of implementing one software program that looks after the needs of the Finance Department together with the needs of the Human Resource Department and the Warehouse, seems impossible. These different departments usually have an individual software program that is optimized in the way each department works.However, if installed correctly this integrated approach can be very cost effective for an organization. With an integrated solution, different departments can easily share information and communicate with one another.The following diagram illustrates the differences between non-integrated systems versus an integrated system for enterprise resource planning.The Driving Force behind ERPThere are two main driving forces behind Enterprise Resource Planning for a business organization.In a business sense, Enterprise Resource Planning ensures customer satisfaction, as it leads to business development that is development of new areas, new products and new services. Also, it allows businesses to face competition for implementing Enterprise Resource Planning, and it ensures efficient processes that push the company into top gear.In an IT sense: Most softwares does not meet business needs wholly and the legacy systems today are hard to maintain. In addition, outdated hardware and software is hard to maintain.Hence, for the above reasons, Enterprise Resource Planning is necessary for management in today's business world. ERP is single software, which tackles problems such as material shortages, customer service, finances management, quality issues and inventory problems. An ERP system can be the dashboard of the modern era managers.Implementing ERP SystemProducing Enterprise Resource Planning (ERP) software is complex and also has many significant implications for staff work practice. Implementing the software is a difficult task too and one that 'in-house' IT specialists cannot handle. Hence to implement ERP software, organizations hire third party consulting companies or an ERP vendor. This is the most cost effective way. The time taken to implement an ERP system depends on the size of the business, the number of departments involved, the degree of customization involved, the magnitude of the change and the cooperation of customers to the project.Advantages of ERP SystemWith Enterprise Resource Planning (ERP) software, accurate forecasting can be done. When accurate forecasting inventory levels are kept at maximum efficiency, this allows for the organization to be profitable.Integration of the various departments ensures communication, productivity and efficiency.Adopting ERP software eradicates the problem of coordinating changes between many systems.ERP software provides a top-down view of an organization, so information is available to make decisions at anytime, anywhere.Disadvantages of ERP SystemAdopting ERP systems can be expensive.The lack of boundaries created by ERP software in a company can cause problems of who takes the blame, lines of responsibility and employee morale.ConclusionWhile employing an ERP system may be expensive, it offers organizations a cost efficient system in the long run. ERP software works by integrating all the different departments in on organization into one computer system allowing for efficient communication between these departments and hence enhances productivity. The organizations should take extra precautions when it comes to choosing the correct ERP system for them. There have been many cases that organizations have lost a lot of money due to selecting the 'wrong' ERP solution and a service provider for rmation Technology Architecture.Introduction:In order to understand the concept of IT Architecture, we first discuss Information Management Technology, trickling down to managements of business and IT strategies where the IT Architecture falls. From the architecture, the business can then be translated into infrastructure. ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"d31IEIlL","properties":{"formattedCitation":"(Pearlson, Saunders, & Galletta, 2016)","plainCitation":"(Pearlson, Saunders, & Galletta, 2016)","noteIndex":0},"citationItems":[{"id":96,"uris":[""],"uri":[""],"itemData":{"id":96,"type":"book","title":"Managing and Using Information Systems A Strategic Approach, 6th Edition","publisher":"John Wiley & Sons, Inc.","publisher-place":"Hoboken, NJ","number-of-pages":"340","edition":"6","event-place":"Hoboken, NJ","ISBN":"978-1-119-24428-8","author":[{"family":"Pearlson","given":"Keri E."},{"family":"Saunders","given":"Carol S."},{"family":"Galletta","given":"Dennis F."}],"issued":{"date-parts":[["2016"]]}}}],"schema":""} notes that the terms architecture and infrastructure are often used interchangeably in the context of IS. However, two differ and each plays important role in realizing a business strategy. Architecture translates strategy into infrastructure. For example, in building a house: The owner has a vision of how the final product should look and function. The owner must decide on a strategy about where to live-in an apartment or in a house. The owner's strategy also includes deciding how to live in the house in terms of taking advantage of a beautiful view, having an open floor plan, or planning for special interests by designing such special areas as a game room, study, music room, or other amenities. The architect develops plans based on this vision. These plans, or blueprints, provide a guide-unchangeable in some areas but subject to interpretation in others-for the carpenters, plumbers, and electricians who actually construct the house. Guided by past experience and by industry standards, these builders select the materials and construction techniques best suited to the plan. The plan helps them determine where to put the plumbing and wiring, important parts of the home's infrastructure. When the process works, the completed house fulfils its owner's vision, even though he or she did not participate in the actual construction. Thus, an IT architecture provides a blueprint for translating business strategy into a plan for IS. An IT infrastructure is everything that supports the flow and processing of information in an organization, including hardware, software, data, and network components.Definitions of an Architect:In a layman’s language, an architect is a person who designs buildings and in many cases also supervises their construction.Definition from Techopedia: An IT architect is an individual that designs information technology solutions and services for organizations. They possess a strong business and IT background to architect software, hardware, network or any IT solution that gives the best results to the business. An IT architect is also known as an enterprise architect. Based on the requirements and/or environment, an IT architect can create: Software architecturesNetwork architecturesEnterprise application/ IT architecturesSecurity architecturesDatabase architecturesIT Architecture is the art and science of designing and delivering valuable technology strategy – Definition by Association For All IT Architects (IASA). An architecture is a prudent management tool that will help ensure that IT is responsive to the organization’s business requirements. Information Technology Management:Information technology is an essential component of business success for companies today; however, information technology is also a vital business resource that must be properly managed. The major components of information technology management is as shown in the figure below.Figure SEQ Figure \* ARABIC 1 – Components of Information Technology ManagementNote the executives with primary responsibilities in each area.Managing Business/IT Strategies. Led by the CEO (chief executive officer) and CIO (chief information officer), proposals are developed by business and IT managers and professionals regarding the use of IT to support the strategic business priorities of the company. This business/IT planning process aligns IT with strategic business goals. .Managing Business/IT Applications and Technologies. This step is the primary responsibility of the CIO and CTO (chief technology officer). This area of IT management involves managing the processes for information systems development and implementation as well as the responsibility for research into the strategic business uses of new information technologies.Managing the IT Organization and the IT Infrastructure. The CIO and IT managers share responsibility for managing the work of IT professionals who are typically organized into a variety of project teams and other organizational subunits. In addition, they are responsible for managing the IT infrastructure of hardware, software, databases, telecommunications networks, and other IT resources, which must be acquired, operated, monitored, and maintained.Business and IT Strategy Component: Further explains that the business and IT strategy component encompasses the business/IT planning process shown in Figure 2, which focuses on discovering innovative approaches to satisfying a company’s customer value and business value goals. This planning process leads to the development of strategies and business models for new business applications, processes, products, and services. Then a company can develop IT strategies and an IT architecture that supports building and implementing its newly planned business applications.Figure SEQ Figure \* ARABIC 2 – The Business/IT Planning ProcessThe business/IT planning process has three major components:Strategy Development. Developing business strategies that support a company’s business vision. For example, using information technology to create innovative e-business systems that focus on customer and business value. Resource Management. Developing strategic plans for managing or outsourcing a company’s IT resources, including IS personnel, hardware, software, data, and network resources.Technology Architecture. Making strategic IT choices that reflect an information technology architecture designed to support a company’s business/IT initiatives.IT Architecture:The IT architecture created by the strategic business/IT planning process is a conceptual design, or blueprint, that includes the following major component:Technology Platform. The Internet, intranets, extranets, and other networks, computer systems, system software, and integrated enterprise application software provide a computing and communications infrastructure, or platform that supports the strategic use of information technology for e-business, e-commerce, and other business/IT applications.Data Resources. Many types of operational and specialized databases, including data warehouses and Internet/intranet databases, store and provide data and information for business processes and decision support.Applications Architecture. Business applications of information technology are designed as an integrated architecture or portfolio of enterprise systems that support strategic business initiatives, as well as cross-functional business processes. For example, an applications architecture should include support for developing and maintaining the interenterprise supply chain applications and integrated enterprise resource planning and customer relationship management applications.IT Organization. The organizational structure of the IS function within a company and the distribution of IS specialists are designed to meet the changing strategies of a business. The form of the IT organization depends on the managerial philosophy and business/IT strategies formulated during the strategic planning mon Configurations of IT Architecture:Traditionally, according to ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"KL35N8Tx","properties":{"formattedCitation":"(Pearlson et al., 2016)","plainCitation":"(Pearlson et al., 2016)","noteIndex":0},"citationItems":[{"id":96,"uris":[""],"uri":[""],"itemData":{"id":96,"type":"book","title":"Managing and Using Information Systems A Strategic Approach, 6th Edition","publisher":"John Wiley & Sons, Inc.","publisher-place":"Hoboken, NJ","number-of-pages":"340","edition":"6","event-place":"Hoboken, NJ","ISBN":"978-1-119-24428-8","author":[{"family":"Pearlson","given":"Keri E."},{"family":"Saunders","given":"Carol S."},{"family":"Galletta","given":"Dennis F."}],"issued":{"date-parts":[["2016"]]}}}],"schema":""} (Pearlson et al., 2016), there are three common configurations of IT architecture as shown in Figure 3.Figure SEQ Figure \* ARABIC 3 - Common architecturesCentralized Architecture: Enterprises sometimes like the idea of a centralized architecture with everything purchased, supported, and managed centrally, usually in a data centre, to eliminate the difficulties that come with managing a distributed infrastructure. In addition, almost every sizable enterprise has a large data centre with servers and/or large mainframe computers that support many simultaneous users. Because of that history, there are a significant number of legacy mainframe environments still in operation today. However, one large computer at the centre of the IT architecture is not used as regularly today as it was in the past. Instead, many smaller computers are linked together to form a centralized IT core that operates very much like the mainframe, providing the bulk of IT services necessary for the business.Decentralized Architecture: A more common configuration is a decentralized architecture. The hardware, software, networking, and data are arranged in a way that distributes the processing and functionality between multiple small computers, servers, and devices, and they rely heavily on a network to connect them together. Typically, a decentralized architecture uses numerous servers, often located in different physical locations, at the backbone of the infrastructure, called a server-based architecture.Service-Oriented Architecture (SOA): A third increasingly common configuration is service-oriented architecture (SOA). An example of a service is an online employment form that, when completed, generates a file with the data for use in another service. Another example is a ticket-processing service that identifies available concert seats and allocates them. These relatively small chunks of functionality are available for many applications through reuse. The type of software used in an SOA architecture is often referred to as software-as-a-service, or SaaS. Another term for these applications when delivered over the Internet is Web services.Architectural Principles: Any good architecture is based on a set of principles, or fundamental beliefs about how the architecture should function. Architectural principles must be consistent with both the values of the enterprise as well as with the technology used in the infrastructure. The principles are designed by considering the key objectives of the organization and then translated into principles to apply to the design of the IT architecture. The number of principles vary widely, and there is no set list of what must be included in a set of architectural principles. A sample of architectural principles is shown in Figure 4 ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"2yfbfljN","properties":{"formattedCitation":"(Pearlson et al., 2016)","plainCitation":"(Pearlson et al., 2016)","noteIndex":0},"citationItems":[{"id":96,"uris":[""],"uri":[""],"itemData":{"id":96,"type":"book","title":"Managing and Using Information Systems A Strategic Approach, 6th Edition","publisher":"John Wiley & Sons, Inc.","publisher-place":"Hoboken, NJ","number-of-pages":"340","edition":"6","event-place":"Hoboken, NJ","ISBN":"978-1-119-24428-8","author":[{"family":"Pearlson","given":"Keri E."},{"family":"Saunders","given":"Carol S."},{"family":"Galletta","given":"Dennis F."}],"issued":{"date-parts":[["2016"]]}}}],"schema":""} (Pearlson et al., 2016).Figure SEQ Figure \* ARABIC 4 - Sample architectural principles. IT architecture/Enterprise IT architecture has stood out due to the following reasons :Smart companies strive to simultaneously combine business management excellence with IT best practices;Enterprise Architecture is one of most important concept - a viable and imperative technology for all large companies to achieve that goal;To create any complex object, including an enterprise, you need properly describe it;Armed with an Enterprise Architecture (EA) for such a description, you will have a chance of being able to properly create or change it.Developing an IT Architecture Steps:Articulate business strategy and implications for IT architecture - start from the top with the overall business strategy and its functional IT requirementsBaseline the company architecture baseline blueprint - assess existing IT bottom-up approachDetermine key architecture questions Outline set of questions to be answered, such as:What technologies do we have?Are these the right technologies?How does the current architecture supportOur business?Are we getting a strategic advantage from our architecture?Look into the future to the planned blueprint:In what technologies should we invest?How should it be structured?How will it give us a competitive advantage?Should we outsource any functions?Design a planned architecture blueprint - decide what the architecture should beInitiate the architecture plan - two approaches that can be used are revolutionary vs. evolutionaryRevolution - radical replacement of old technologyEvolution - new technology layered on top of existing infrastructure; old systems gradually replaced over timeCase Study: Enterprise Architecture at American Express ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"OUARfum8","properties":{"formattedCitation":"(Pearlson et al., 2016)","plainCitation":"(Pearlson et al., 2016)","noteIndex":0},"citationItems":[{"id":96,"uris":[""],"uri":[""],"itemData":{"id":96,"type":"book","title":"Managing and Using Information Systems A Strategic Approach, 6th Edition","publisher":"John Wiley & Sons, Inc.","publisher-place":"Hoboken, NJ","number-of-pages":"340","edition":"6","event-place":"Hoboken, NJ","ISBN":"978-1-119-24428-8","author":[{"family":"Pearlson","given":"Keri E."},{"family":"Saunders","given":"Carol S."},{"family":"Galletta","given":"Dennis F."}],"issued":{"date-parts":[["2016"]]}}}],"schema":""} (Pearlson et al., 2016)Enterprise architecture (EA) at American Express was the framework the organization used to align IT and the business. EA provided a common language for leaders to use to collaborate and transform the business. At American Express, enterprise architects were the change agents who streamlined processes and designed ways to more effectively do business using IT resources. In 2011, American Express was named an Info World/Forrester Enterprise Architecture Award recipient for its EA practices. As American Express leaders considered new payment methods using mobile devices, the EA guided their progress.Mobile payments were forcing the payments industry to review their practices and significantly transform the way business was done. The new business environment introduced additional complexity with the addition of new delivery channels and the need for shorter time-to-market of payment products and services. American Express's business strategy for its payments products focused on delivering a "consistent, global, integrated customer experience based on services running on a common application platform."To achieve this goal, the EA team created reference architectures and road maps for standardized applications across the firm. This team then worked with multiple business solution delivery teams to create and manage the common application architecture and create strategies that facilitated each business's objectives. Each strategy included a road map of initiatives that included a set of actions, the metrics to evaluate the success of these actions, and the commitments IT and the businesses made to make it happen. The road map was American Express's way to standardize language, tools, life cycle management of the applications, and architecture and governance processes. The elements of the road map included technology, reference architecture, and capabilities for the business.The next steps for American Express were to extend the road maps to cover the maturing of SOA and to develop new reference architectures and a new taxonomy to increasingly align IT with the needs of the business. As new technologies emerged and new ways of doing business over social tools created opportunities for new payment products and services, American Express expected to continually evolve its EA.Enterprise information systemAn?enterprise information system?(EIS) is any kind of?information system?which improves the functions of enterprise business processes by integration. This means typically offering high quality of service, dealing with large volumes of?data?and capable of supporting some large and possibly complex?organization?or enterprise. An EIS must be able to be used by all parts and all levels of an enterprise. The word?enterprise?can have various connotations. Frequently the term is used only to refer to very large organizations such as multi-national companies or public-sector organizations. However, the term may be used to mean virtually anything, by virtue of it having become the latest corporate-speak?buzzwordPurposeEnterprise information systems provide a technology platform that enables organizations to?integrate?and coordinate their?business processes?on a robust foundation. An EIS is currently used in conjunction with?customer relationship management?and?supply chain management?to automate business processes. An enterprise information system provides a single system that is central to the organization that ensures information can be shared across all functional levels and management?hierarchies. An EIS can be used to increase business?productivity?and reduce service cycles,?product development?cycles and marketing life cycles.[1]?It may be used to amalgamate existing applications. Other outcomes include higher?operational efficiency?and cost savings. Financial value is not usually a direct outcome from the implementation of an enterprise information system. Design stageAt the design stage the main characteristic of EIS efficiency evaluation is the probability of timely delivery of various messages such as command, service, etc.[3]Information systemsEnterprise systems create a standard?data structure?and are invaluable in eliminating the problem of information fragmentation caused by multiple information systems within an organization. An EIS differentiates itself from?legacy systems?in that it is self-transactional, self-helping and adaptable to general and specialist conditions.?Unlike an enterprise information system, legacy systems are limited to department-wide communications. A typical enterprise information system would be housed in one or more?data centers, would run?enterprise software, and could include applications that typically cross organizational borders such as?content management systems.Enterprise planning systemAn?enterprise planning system?covers the methods of planning for the internal and external factors that affect an?enterprise. These factors generally fall under?PESTLE. PESTLE refers to political, economic, social, technological, legal and environmental factors. Regularly addressing PESTLE factors falls under?operations management. Meanwhile, addressing any event, opportunity or challenge in any one or many factors for the first time will involve?project management. As opposed to?enterprise resource planning?(ERP), enterprise planning systems have broader coverage. Enterprise planning systems address the resources that are available or?not?available to an enterprise and its ability to produce products or resources and/or provide services. It also considers those factors that will positively or negatively affect the firm's ability to run these actions.Enterprise planning systems will tend to vary and are flexible. These are due to the periodic and adaptive nature of strategy formation. These will also have tactical aspects. Typically, enterprise planning systems are part of a firm's knowledge base or corporate structure whether it formally identified and structured or simply executed these when the need appeared.PurposesAn enterprise planning system will address at least three basic purposes to help the enterprise:survivecompetethriveSurvivalAn enterprise will plan for tactical moves for quick reaction to the PESTLE threats that affect its survival. For instance, right after Japan's Fukushima nuclear power plant has experienced explosions due to the earthquake and the tsunami that followed, several enterprises (within and outside kenyan) have publicly announced their course of actions to address the emergency. CompetitionMeanwhile, an enterprise will plan for longer term strategic actions to address its competition or improve its?competitiveness. For instance, enterprises will plan for, set budgets, implement and use?strategic information systems?as “information systems or information technology investments can be a source of competitive advantage”. OpportunitiesMost significantly, an enterprise will plan for using the PESTLE opportunities that are available to it. The profit and benefit motives justify most enterprise planning systems. VulnerabilitiesA fourth noteworthy purpose for enterprise planning systems is preparedness against terrorist attacks. As noted in the US Presidential Directive for?Critical infrastructure protection, terrorist groups are likely to attack commercial infrastructure for economic sabotage. Enterprises that are providing products or services that are critical to the economic system of a nation are potential targets of extremists.Strategic planningTwo major characteristics of EPSs are (1) variety and (2) flexibility. For instance, technological risks abound as even enterprise software are prone to?obsolescence?and?disruptive innovations. Technology is not stagnant. Thus, variety and flexibility work to the advantage of a strategically adaptive or?agile?enterprise as PESTLE conditions change.To illustrate this some more, ERP software prescribes processes to realize its promised benefits. However, compliance to these rigid, prescribed processes is often assumed rather than real. In many cases, the ERP software is accepted but the practices within the enterprise reflect inconsistencies with the prescribed processes of the software. In a sense, variety and flexibility in a standard ERP implementation will still manifest in many ways such as "workarounds, shadow systems, various forms of unintended improvisations, and organizational 'drift'" as the?knowledge workers?in the enterprise adapt to the realities of daily activities. With changing real world conditions, at least three components can structure enterprise strategy. These are:analytical frameworks for the evaluation of PESTLE data at a given timegeographic coverage of operations to manage risks or maximize benefits from?macroeconomic?forces or government regulationsprojects integration to efficiently support enterprise operationsStrategy via analysisFrameworks of analysis usually drive a firm's strategy. These enable the firm to cope with the actions of its competitors, demands of its consumers or clients, nature of its operating environments, effects of government regulations in the places where it does business, or opportunities that are available among other factors.?Here, team planning is crucial. One group will normally specialize in one aspect like operations or government regulations. Managing the interrelation of PESTLE factors requires teamwork in the enterprise planning process. A sample framework for general analysis is the?SWOT analysis. Another is the?Balanced Scorecard?for performance measurement analysis. Strategy via geographyEnterprise strategy can also refer to the mix of structured actions that address the political, economic, social, technological, legal and environmental factors that affect a business or firm. These structured actions can be local, transnational, global or combination of local, transnational or global.?Hence, enterprises can have any of the following geographic strategies in their plans:local strategyregional strategy (Europe, North America, Asia-Pacific, etc.)international strategyglobal strategyglobal and local strategyStrategy via projects integrationMoreover, since management actions occur simultaneously in an enterprise, strategic planners can consider operations or?project portfolio management?(PPM) as crucial elements in an enterprise's strategic planning guide.For instance, the need to have strategic priorities across many projects in companies with multiple product development projects have made executives borrow principles from investment portfolio management to better manage the distribution of resources compared with the assessed risks for each project. Thus, PESTLE factors lead to strategy formation that will enable the enterprise to adapt to changing conditions. Meanwhile, the strategies that have been formed from the analytical framework processes of evaluating an enterprise's condition will lead to detailed plans which could be part of a firm's manual of operations or projects portfolio thrusts for funding and execution across the units or geographic coverage of the enterprise.Planning and budgetingEnterprise planning and budgeting go hand-in-hand as the wherewithal to execute plans will determine the success or failure of an enterprise strategy. In another light, expanding or limiting the budget for a particular operations aspect of the enterprise or an ongoing project in favor of another will signal changes to an enterprise's strategy.?Hence, planning and budgeting are integral parts of any enterprise planning systems as these impact the strategic directions of the enterprise.For instance, enterprise projects tend to be mutually dependent with other projects to leverage a firm's engineering, financial and technology resources. A market research project will trigger a research, development and engineering (RD&E) project for a new product. In turn, this RD&E project could trigger a production strategy project to manufacture the new product at the most efficient locations to bring it closer to its target consumers.?Hence, cutting the RD&E project budget in half or increasing it twice will have profound effects in the long term direction of an enterprise as this will affect the other units of the firm undertaking projects that are linked to the RD&E project.ClassificationsEnterprise planning and budgeting can be generally classified into:centralizeddevolvedhybridCentralized.?Headquarters or executive management directs all planning and budgets from the top then downwards in the organization hierarchy. It will closely follow Frederick Winslow Taylor's Principles of?Scientific Management.Devolved.?Middle managers set plans effectively steering the enterprise's strategic direction. Executive management takes into account that the enterprise has knowledge workers that are experts in their respective fields. The Management Board approves the proposed strategic direction under certain financial constraints such as expected returns on investment or equity.Hybrid.?Executive management determines and sets the strategic direction of the enterprise based on the inputs of middle managers and the rank and file. In this set up, plans and budgets are negotiated.Essentially, enterprise plans and budgets can be detailed in a top-down approach, generalized in a bottom-up approach, or combined in a top-down and bottom-up approach.Group planningEnterprise group planning will typically refer to the involvement of the major units of an enterprise such as the finance, marketing, production or technology departments. It can also refer to the involvement of the geographic units of a transnational or global firm. Some enterprises also involve external parties in their group planning where inputs from the crucial parts of the supply chain, cooperation and collaboration, or outsiders-looking-in are part of the firm's strategy.Enterprise group planning will usually manifest in regular board of directors' or management committee' meetings with varying frequencies such as monthly, quarterly or annually. Traditional meetings have required the physical presences of representatives from the various business units of the enterprise. With improvements in telecommunications, enterprise group planning can be conducted through video conferencing where participants may be dispersed geographically. However, video conferencing still appears to be an inadequate substitute when warm, interpersonal relations are part of the firm's culture.Yet for fast-paced events like natural disasters or a meltdown of the financial markets that require immediate action from the enterprise, video conferencing might be the only option. Troubleshooting that requires the major resources of the enterprise will also entail enterprise group planning. Here, enterprise planning systems take a tactical form rather than a strategic focus to preserve the stability or ensure the survival of the enterprise.Transition planEnterprise transition plans will generally refer to change management-related actions in the case of mergers or in the implementation of an enterprise-wide project. The transition plan will cover the elimination of redundant functions in the case of a merger or the incorporation of new processes into business operations in the case of a technology project.Planning softwareEnterprise planning software will have varied or depth of coverage but will not essentially refer to enterprise resource planning software. This will include planning-centric software and the tools to support strategic and tactical planning for and across the enterprise, such as:strategy formation and scenario planning software (for example, supporting?Sales and operations planning?process)performance measurement and evaluation softwareproject management?softwaredata warehouse?or?business intelligence?softwareenterprise optimization?software enterprise Enterprise relationship management?or?ERM?is a business method in?relationship management?beyond?customer relationship management. ERM - Enterprise Relationship Management is basically a business strategy for value creation that is not based on cost containment, but rather on the leveraging of network-enabled processes and activities to transform the relationships between the organization and all its internal and external constituencies in order to maximize current and future opportunities.OverviewRelationship management?is not an entirely new concept. In fact, it has taken on many forms that address specific organizational constituencies (customers, channel partners, specialized service providers, employees, suppliers, etc.). The most obvious form is CRM (customer relationship management), which focuses on improving top-line growth by maximizing an organization's ability to identify sales and business opportunities with its customers. CRM's little brother PRM (partner relationship management), focuses on optimizing opportunity and downstream order management for an organization's channel partners (e.g. CISCO and its partner lead and referral management process) On the back end, we have ERP (enterprise resource planning) to manage internal operations including manufacturing, finance, HR, sales and distribution, etc. Specialized HRM (human resource management) solutions exist to manage employee benefits, collective agreements, performance reviews and so forth. And lastly, SCM (supply chain management, either as an ERP module or as a stand-alone application) to manage the product flow, up and down a firm's value chain, with external partners/suppliers.Making the links in a business networkHowever, according to Galbreath (2002), "for the most part CRM, human resources management (HRM), enterprise resource planning (ERP), supply chain management (SCM), partner relationship management (PRM) and similar programs have paid very little attention to the relationships that underpin those processes, or to the intangible – relationship – assets embedded in them." One of the chief strategic challenges of the new economy is to integrate knowledge and relationships – devise a good fit between competencies (Competencies are the technologies, specialized expertise, business processes and techniques that a company has accumulated over time and packages in its offering) and customers and keep that fit current." Galbraeth (2002) adds that "success in the relationship age requires a deliberate process of creating intangible, relationship assets, growing them and?monetizing them".Galbreath (2002) suggests that enterprise relationship management is a process that harmonizes and synergizes different organizational relationships to realize targeted business benefits and goal. Harbison et al. (2000)did some research on the performance of alliances and cited the following statistics in their study:"Strategic alliances have consistently produced a return on investment of nearly 17 percent among the top 2,000 companies in the world for nearly a decade. This return is 50 percent more than the average return on investment that the companies produced overall." Harbison et al. (2000)"The 25 companies most active in alliances achieved a 17.2 percent return on equity - 40 percent more than the average return on equity of the Fortune 500." - Harbison et al. (2000)"The 25 companies least active in alliances lagged the Fortune 500, with an average return on equity of only 10.1 percent." - Harbison et al. (2000)"Successful alliances recognize 20 percent profitability improvements as compared to only 11 percent for the less successful companies." - Harbison et al. (2000)"Revenue generation from highly successful alliances equates to 21 percent of overall firm sales as compared to 14 percent for less successful alliances." - Harbison et al. (2000)In a similar study conducted for the supplier side (results of efficiently run supply chains based on electronic integration and quality processes presents the following statistics for suppliers:Inventory levels reduced by as much as 50 percent.Inventory turns doubled.Stock outs reduced nine fold.On-time deliveries increased by as much as 40 percent.Cycle times decreased by as much as 27 percent overall.Supply chain costs reduced by as much as 20 percentRevenues increased by as much as 17 percent.When looking at these numbers, collaboration with outside firms becomes very attractive. But success in business, as in many other pursuits, is dependent on motivation, investment, trust, discipline and repeatability.Tools and methodologiesERM frameworks are needed because relationships are becoming prevalent and more integral to an organization's success. Although establishing inter-enterprise links is far from a new science, With statistics like these, the need to improve relationship success rates seems quite obvious. Many authors have addressed these issues from varying perspectives, including technology enabling a firm, reviewing or re-designing operational & administrative processes, and transforming the culture to one that is more adapted to collaboration. state, collaboration or rather the effective leveraging of relationship resources to create new sources of value, is a process of learning and developing new mental models and competencies as well as obtaining resources through new means/sources.ERM is still a relatively new field and few players stand-out with a complete ERM methodology and tools. Nevertheless, a host of best of breed tools and methodologies exist to carry out an ERM implementation, unfortunately they are not integrated and focus on very specialized problem areas. ERM tools can be viewed as enablers of an ERM methodology.Fundamentally adopting ERM is a cultural and change management issue more than a technology or process one. Therefore, regardless of the methodology or tools that one may elect to use when integrating with outside firms, they must maintain a focus on the human side of the equations. The figure below illustrates the benefits of focusing on the human, cultural and change aspect of a project, notably deploying ERM in this case.Practical methodologies and frameworksRIIM and Power ScopeRIIM (Relationship Intelligence and Influence Management) is a registered method of Perfluence.[1]?It is a systemic approach based on the assumption that each relationship can be seen as a linear combination of five different kind of common relationships. This method can be used "stand alone" or within the SaaS software Power Scope that carries each concept developed in the RiiM method. It enables an accurate and detailed vision of influence maps or relationship matrices, especially with graphic visualizations.Velox frameworkVelox ERM is a product of Technology Partnerz.?It integrates ONA -?organizational network analysis,[3]?process re-design,?IS/IT strategy,?change management,?supplier relationship management,?customer relationship management, and?risk and business continuity management?into a comprehensive and simple framework that supports people and organizations in repeatable/consistently:Mapping and understanding collaborative processes and networks within and across organizational boundariesBenchmarking collaborative capabilityIdentifying and selecting the best partners and collaborators to minimize risk and improve agility of the business network]Understanding and deploying collaborative best practices[Aligning and leveraging new and existing business relationships to business objectives]Accelerating/Facilitating the adoption of business change related to processes, policies, systems and culture changes.Accelerating decision making resulting in improved corporate responsiveness to changing market conditionsAlso available in a searchable knowledge base tool that supports managers and business professionals to effectively understand and use collaborative best practices and accelerate the adoption of ERM.TRANSACTION PROCESSINGTransaction ProcessingTransaction processing is the process of completing a task and/or user/program request either instantly or at runtime. It is the collection of different interrelated tasks and processes that must work in sync to finish an overall business process transaction.Transaction processing relates to any real-time business transaction or process performed by a transaction processing system (TPS) or other business information system (BIS). The process occurs when a user requests completion or fulfillment of any process. Once a a TPS or related system receives a request, it coordinates with the respective system for authorization, data requests or any specific task essential to a complete transaction.For example, when a cash withdrawal request is made at an ATM machine, the machine first authorizes the user credentials and balance inquiry/status from the back end banking systems. Once the information is received, the ATM machine processes the user request or overall transaction. Moreover, a TPS can accept, reject or halt a transaction based on environmental variables.Transaction Processing Monitor (TPM)A transation processing monitor is critical in multi-tier architectures. With processes running on different platforms, a given transaction may be forwarded to any one of several servers. Generally, the TP monitor handles all load balancing. After completing each transaction, the TPM can process another transaction without being influenced by the prior transaction. In other words the TPM model essentially is statelessIn general, a TPM provides the following functionality:Coordinating resourcesBalancing loadsCreating new processes as/when neededProviding secure access to servicesRouting servicesWrapping data messages into messagesUnwrapping messages into data packets/structuresMonitoring operations/transactionsManaging queuesHandling errors through such actions as process restartingHiding interprocess communications details from programmersAsynchronous Transfer Mode (ATM)Asynchronous transfer mode (ATM) is a switching technique used by telecommunication networks that uses asynchronous time-division multiplexing to encode data into small, fixed-sized cells. This is different from Ethernet or internet, which use variable packet sizes for data or frames. ATM is the core protocol used over the synchronous optical network (SONET) backbone of the integrated digital services network (ISDN).Asynchronous transfer mode was designed with cells in mind. This is because voice data is converted to packets and is forced to share a network with burst data (large packet data) passing through the same medium. So, no matter how small the voice packets are, they always encounter full-sized data packets, and could experience maximum queuing delays. This is why all data packets should be of the same size. The fixed cell structure of ATM means it can be easily switched by hardware without the delays introduced by routed frames and software switching. This is why some people believe that ATM is the key to the internet bandwidth problem. ATM creates fixed routes between two points before data transfer begins, which differs from TCP/IP, where data is divided into packets, each of which takes a different route to get to its destination. This makes it easier to bill data usage. However, an ATM network is less adaptable to a sudden network traffic surge.The ATM provides data link layer services that run on the OSI's Layer 1 physical links. It functions much like small-packet switched and circuit-switched networks, which makes it ideal for real-rime, low-latency data such as VoIP and video, as well as for high-throughput data traffic like file transfers. A virtual circuit or connection must be established before the two end points can actually exchange data.ATM services generally have four different bit rate choices:Available Bit Rate: Provides a guaranteed minimum capacity but data can be bursted to higher capacities when network traffic is minimal.Constant Bit Rate: Specifies a fixed bit rate so that data is sent in a steady stream. This is analogous to a leased line.Unspecified Bit Rate: Doesn’t guarantee any throughput level and is used for applications such as file transfers that can tolerate delays.Variable Bit Rate (VBR): Provides a specified throughput, but data is not sent evenly. This makes it a popular choice for voice and videoconferencing.Advanced Business Application Programming (ABAP)?Advanced business application programming (ABAP) is a 4GL application-specific programming language developed in the 1980s by the German software company SAP. The syntax of ABAP is somewhat similar to COBOL. ABAP was and remains the programming language for the development and modification of SAP applications. The widely installed R/3 system was first released by SAP in 1992 and developed in ABAP. In 1999, SAP released an object oriented extension to ABAP, which denoted ABAP objects. In 2004, SAP introduced its current development environment called NetWeaver, which supports both ABAP and Java.Translated from German, ABAP stands for Allgemeiner Berichtsaufbereitungsprozessor which means “generic report preparation process.” ABAP programs reside in the SAP database and are edited using the ABAP Workbench tools. They are compiled, debugged and run within the context of the SAP basis component, which is typically implemented as part of the SAP Web application server.ABAP programs can be categorized into reports and module tools. The term “report” is freely used to denote programs that manipulate data in a list-oriented manner.SAP customers can create custom reports and user interfaces using the ABAP programming language. ABAP is easy to learn for programmers, less so for non-programmers. Programmers learning ABAP are assumed to have working knowledge of relational database design and object oriented programming concepts..NET Enterprise Server?.NET Enterprise Server is a family of server products from Microsoft designed to build, integrate, manage and execute Web-based enterprise applications in a faster and simpler Enterprise Server has underlying technologies that can be used to integrate Commerce Server sites with enterprise information systems to build Web-based systems with better scalability, reliability, security, performance and integrity. By following open standards such as XML and SOAP, among others, .NET Enterprise Server products provide flexibility and interoperability with other applications to facilitate integration with multiple applications across multiple platforms..NET Enterprise Server was launched by Microsoft as an upgraded version of BackOffice Server 2000 to provide back-office services such as content management and data processing, which played a major role in providing access to enterprise resources across the network and the Web with the help of its underlying services. Its evolution from its predecessor technology indicates Microsoft's clear strategy to transition to meet the demands of enterprise software and technology by leveraging Internet infrastructure and its Web service solutions.?.NET Enterprise Server includes the following commonly used platforms:Commerce Server: A platform with a set of tools to create and manage fully-featured e-commerce sites catering to business scenarios including business-to-consumer (B2C), business-to-business (B2B) and B2X (a combination of B2C and B2B). It is used to build rapid online businesses and enables customers to improve site functionality, increase profitability and boost customer experience.Microsoft Biztalk Server: An XML-based application integration server offering services like enterprise application integration, business process automation and business activity monitoring. It provides a powerful Web-based development and execution environment that can integrate loosely coupled applications.Microsoft SQL Server: A relational model database server with scalable database, complex analysis and data warehousing tools along with development tool for developing data-driven applications.Microsoft Host Integration Server (MHIS): A comprehensive integration platform that enables users to integrate data, application and security in existing host systems with Windows and Web-based systems, AS/400s and mainframes so as to use existing large-scale legacy data stores in new applications..NET Enterprise Server's business value has improved through its combination with .NET and XML Web services because these solved the integration issues by providing flexible solutions to address an agile business's needs.Enterprise Application Integration (EAI)?EAI is the process of linking business applications within a single organization together in order to simplify and automate business processes to the greatest extent possible. In a nutshell, EAI assists to create a transparent flow of data through business processes, Identify patterns that impact business processes and compensate immediately and it ensures seamless integration of business processes for the purposes of conducting business electronicallyEnterprise application integration (EAI) is the use of technologies and services across an enterprise to enable the integration of software applications and hardware systems. Many proprietary and open projects provide EAI solution support. EAI is related to middleware technologies. Other developing EAI technologies involve Web service integration, service-oriented architecture, content integration and business processes. Intercommunication between enterprise applications (EA), such as customer relations management (CRM), supply chain management (SCM) and business intelligence is not automated. Thus, EAIs do not share common data or business rules. EAI links EA applications to simplify and automate business processes without applying excessive application or data structure changes. However, EAI is challenged by different operating systems, database architectures and/or computer languages, as well as other situations where legacy systems are no longer supported by the original manufacturers. EAI meets these challenges by fulfilling three purposes, as follows:Data Integration: Ensures consistent information across different systems.Vendor Independence: Business policies or rules regarding specific business applications do not have to be re-implemented when replaced with different brand mon Facade: Users are not required to learn new or different applications because a consistent software application access interface is provided.The Major 4 Drivers of EAIThe major drivers of EAI (enterprise application integration) are new technological advancement and modern age dynamics, real-time data access, cost reduction of integrating multiple application and seamless data transformation. Enterprise application integration helps any companies to produce a cost-effective solution for transforming various complicated applications into a common and recognizable platform.? In order to propel business activities, proper co-ordination with customers, suppliers and manpower across the globe connected through the real-time informationTypes of EAIThe types of EAI can vary from many factors including company size and industry, integration and project complexity and the budget and. Here we have given the four major EAI Levels1. Data?Level Enterprise Application IntegrationData level EAI is the process or technology to move the data between databases. At this level, the way of information can be extracted from as many as hundreds of databases and thousands of tables. The types of Data level EAI follow asPull data level EAIPush Data level EAI2.?Business Model Level EAIApplication-level integration?– In Application Level EAI, The developer uses the Custom or packaged interfaces to access the business processes and information for integration. At this level, Various API Can be used to integrate the application to share the business logic and information. This EAI level of integration consists of leveraging the interfaces provided by custom or packaged applications to access business processes and simple information. Usually, this kind of integration is done in a three-step process:Extract the information from one application through a provided application interface.Convert the data in a format understandable by the target application.Transmit the information to the target application.The most commonly used approach to implement this kind of integration is called "message broker," an approach which standardizes and controls the flow of information through a bus or a hub framework. But with the increasing popularity of web services, legacy and packaged applications are starting to use them to expose their business features. The availability of these business functions as reusable services causes the increased use of?Service-Oriented Architectures (SOA)?as an alternative to "message broker."The main benefits of this approach are the fact that the interfacing between the different applications is relatively easy due to the fact that the application interfaces are provided by application. A negative aspect of this approach is the cost of the message broker technology. In the past, these interfaces were often application dependent, obliging the developers to learn the specific features and functions of each interface. But with the increasing popularity of XML and its adoption as a standard language for many application interfaces, this problem is disappearing.Method-level integration?– the logic of the business will be shared between different applications within the enterprise. At this level, various applications can be accessed rewriting each method within the respective applications. Method-level integration is similar to application interface level but at a lower level of granularity. The idea here is not to share business functions (as in application interface level), but to share directly the different methods used to compose a given business function. All other enterprise applications needing to implement the same methods can use them without having to rewrite it. Even if this integration level can be done with a lot of technologies (Java RMI, Corba, DCOM, etc.), the emerging trend in implementing this approach is to use Web services as a way to share the methods. The ability to share methods and to reuse business logic make this approach very suited for EAI. But the downside to this approach is that it is also the more invasive approach because it supposes the modification of existing applications to allow the sharing at such a low level.User interface (UI)-level integration?– At this level, User Interfaces are used to tie different applications together. This process uses windows and menus to get the relevant data that needs to be extracted and moved to other applications and data stores. User interface-level EAI is also commonly called "Refacing" and consists of replacing existing text-based user interfaces of legacy systems and graphical interfaces of PCs by a standardized interface, typically browser-based. Enterprise business portals are an emerging solution for this kind of integration and consist of federating the presentation of multiple applications into one customizable browser-based interface. This kind of integration is less expensive than other approaches, as the code of the existing applications is not modified. However, this approach is also less flexible for the same reason.EAI and MiddlewareIn EAI, middleware technology is just used as a mechanism to move information and share business processes from one application to another. The middleware hides the complexities of the communication mechanism between source and target systems. This allows the developers to concentrate on dealing with the APIs (Application Programming Interfaces) of each system, while the middleware handles the passing of the information between the two systems. The same middleware API can be used by different applications running on different platforms. As an underlying technology of EAI, middleware can be used at any level of integration (even at?user interface level?because business portals can be considered as a kind of middleware). However, the most common use of middleware technology is with message broker at?application interface level.EAI and XMLThe eXtensible Markup Language (XML) standard is a text-based markup language specification from the World Wide Web Consortium (W3C) whose objective is to define portable structured data. Because XML is simple and becoming a widely used interchange format, it is ideal as EAI message format and protocol. XML can be used with every integration level (except perhaps at user interface level). It can be used at data level as common data exchange format, at application interface level as messaging format and/or protocol within a message broker, or in a?Service-Oriented Architectures (SOA)?as support for web services. Because Web services are built using XML, it also has a place at method-level integration.The Advantages of Enterprise Application Integration:There are many benefits offered by enterprise application integration (EAI). For instance, users across the organization are able to access information in real time. They are also able to benefit from streamlined processes and save both time and effort while being able to make more accurate, better-informed decisions, thanks to data integration across the whole organization.Mergers & Acquisitions:?Assists in Supply Chain Management and has the ability to adapt to business changes like Mergers and Acquisitions as it unifies/ integrates applications in no time.Seamless Data Transformation:?Presents user applications with a unified view of information for better decision making thereby achieving cross system consistency.Zero Latency:?Assists in formation of Zero Latency Enterprise – when all functions within the organization work with the same up-to-data information, latency between applications is eliminated/ reduced.Real-Time Information Access:?Updating and integrating applications is possible whenever required. New applications can be created by integrating real-time data from different parts of the enterprise.Fast Process Automation:?Assists in rapid business process change.Data Management:?Enables creation of virtual corporations with virtual supply chains and operations through sharing of data beyond the organization.Web:?Makes possible for legacy or proprietary systems to function on web.Efficiency:?Enhancements to standard applications can be made rapidly.?The Main Challenges of Enterprise Application Integration:Here is the list of main challenges that should be considered when implementing enterprise application integration.Time-consuming:?EAI implementations are very time consuming and need a lot of resources.Constant change:?The very nature of EAI is dynamic and requires dynamic project managers to manage their implementation.EAI is a tool paradigm:?EAI is not a tool and it is a process, but rather a system and should be implemented as such.Building interfaces is an art:?Engineering the solution is not sufficient. Solutions need to be negotiated with user departments to reach a common consensus on the final outcome and requires smart business design. A lack of consensus on interface designs leads to excessive effort to map between various systems data requirements.Loss of detail:?Information that seemed unimportant at an earlier stage may become crucial later and It can be executed with the help of proven EAI Integration companies.Accountability:?Since so many departments have many conflicting requirements, there should be clear accountability for the system’s final structure.Wrong EAI Technology Partner:?Choosing the wrong EAI technology partner for the needs of the business.PatternsThis section describes common design patterns for implementing EAI, including integration, access and lifetime patterns. These are abstract patterns and can be implemented in many different ways. There are many other patterns commonly used in the industry, ranging from high-level abstract design patterns to highly specific implementation patterns.Integration patternsThere are two patterns that EAI systems implement:Mediation?(intra-communication): Here, the EAI system acts as the go-between or broker between multiple applications. Whenever an interesting event occurs in an application (for instance, new information is created or a new transaction completed) an integration module in the EAI system is notified. The module then propagates the changes to other relevant applications.Federation?(inter-communication): In this case, the EAI system acts as the overarching facade across multiple applications. All event calls from the 'outside world' to any of the applications are front-ended by the EAI system. The EAI system is configured to expose only the relevant information and interfaces of the underlying applications to the outside world, and performs all interactions with the underlying applications on behalf of the requester. Both patterns are often used concurrently. The same EAI system could be keeping multiple applications in sync (mediation), while servicing requests from external users against these applications (federation).Access patterns: EAI supports both asynchronous (fire and forget) and synchronous access patterns, the former being typical in the mediation case and the latter in the federation case.Lifetime patterns: An integration operation could be short-lived (e.g. keeping data in sync across two applications could be completed within a second) or long-lived (e.g. one of the steps could involve the EAI system interacting with a human?work flow?application for approval of a loan that takes hours or days to complete).TopologiesThere are two major topologies:--?hub-and-spoke, and?bus. Each has its own advantages and disadvantages. In the hub-and-spoke model, the EAI system is at the center (the hub), and interacts with the applications via the spokes. In the bus model, the EAI system is the bus (or is implemented as a resident module in an already existing message bus or?message-oriented middleware). Most large enterprises use zoned network to create layered defense against network oriented threats. For example, an enterprise typically has a credit card processing (PCI-compliant) zone, a non-PCI zone, a data zone, a DMZ zone to proxy external user access, and an IWZ zone to proxy internal user access. Applications need to integrate across multiple zones. The?Hub and spoke?model would work better in this case.TechnologiesMultiple technologies are used in implementing each of the components of the EAI system:Bus/hubThis is usually implemented by enhancing standard middleware products (application server, message bus) or implemented as a stand-alone program (i.?e., does not use any middleware), acting as its own middleware.Application connectivityThe bus/hub connects to applications through a set of?adapters?(also referred to as?connectors). These are programs that know how to interact with an underlying business application. The adapter performs two-way communication, performing requests from the hub against the application, and notifying the hub when an event of interest occurs in the application (a new record inserted, a transaction completed, etc.). Adapters can be specific to an application (e.?g., built against the application vendor's client libraries) or specific to a class of applications (e.?g., can interact with any application through a standard communication protocol, such as?SOAP,?SMTP?or?Action Message Format?(AMF)). The adapter could reside in the same process space as the bus/hub or execute in a remote location and interact with the hub/bus through industry standard protocols such as message queues, web services, or even use a proprietary protocol. In the Java world, standards such as?JCA?allow adapters to be created in a vendor-neutral manner.Data format?and?transformationTo avoid every adapter having to convert data to/from every other applications' formats, EAI systems usually stipulate an application-independent (or common) data format. The EAI system usually provides a data transformation service as well to help convert between application-specific and common formats. This is done in two steps: the adapter converts information from the application's format to the bus's common format. Then, semantic transformations are applied on this (converting zip codes to city names, splitting/merging objects from one application into objects in the other applications, and so on).Integration modulesAn EAI system could be participating in multiple concurrent integration operations at any given time, each type of integration being processed by a different integration module. Integration modules subscribe to events of specific types and process notifications that they receive when these events occur. These modules could be implemented in different ways: on?Java-based EAI systems, these could be?web applications?or?EJBs?or even?POJOs?that conform to the EAI system's specifications.Support for?transactionsWhen used for process integration, the EAI system also provides transactional consistency across applications by executing all integration operations across all applications in a single overarching distributed transaction (using?two-phase commit protocols?or?compensating transactions).Communication architecturesCurrently, there are many variations of thought on what constitutes the best infrastructure, component model, and standards structure for Enterprise Application Integration. There seems to be consensus that four components are essential for a modern enterprise application integration architecture:A centralized broker that handles security, access, and communication. This can be accomplished through integration servers (like the?School Interoperability Framework (SIF)?Zone Integration Servers) or through similar software like the?enterprise service bus?(ESB) model that acts as a services manager.An independent data model based on a standard data structure, also known as a?canonical data model. It appears that XML and the use of XML style sheets has become the?de facto?and in some cases?de jure?standard for this uniform business language.A connector, or agent model where each vendor, application, or interface can build a single component that can speak natively to that application and communicate with the centralized broker.A system model that defines the APIs, data flow and rules of engagement to the system such that components can be built to interface with it in a standardized way.Although other approaches like connecting at the database or user-interface level have been explored, they have not been found to scale or be able to adjust. Individual applications can publish messages to the centralized broker and subscribe to receive certain messages from that broker. Each application only requires one connection to the broker. This central control approach can be extremely?scalable?and?highly evolvable. Enterprise Application Integration is related to middleware technologies such as message-oriented middleware (MOM), and data representation technologies such as?XML?or?JSON. Other EAI technologies involve using?web services?as part of?service-oriented architecture?as a means of integration. Enterprise Application Integration tends to be data centric. In the near future, it will come to include?content integration?and?business processes.Implementation pitfallsIn 2003 it was reported that 70% of all EAI projects fail. Most of these failures are not due to the software itself or technical difficulties, but due to management issues. Integration Consortium European Chairman Steve Craggs has outlined the seven main pitfalls undertaken by companies using EAI systems and explains solutions to these problems.Constant change: The very nature of EAI is dynamic and requires dynamic project managers to manage their implementation.Shortage of?EAI experts: EAI requires knowledge of many issues and technical peting standards: Within the EAI field, the paradox is that EAI standards themselves are not universal.EAI is a tool paradigm: EAI is not a tool, but rather a system and should be implemented as such.Building interfaces is an art: Engineering the solution is not sufficient. Solutions need to be negotiated with user departments to reach a common consensus on the final outcome. A lack of consensus on interface designs leads to excessive effort to map between various systems data requirements.Loss of detail: Information that seemed unimportant at an earlier stage may become crucial later.Accountability: Since so many departments have many conflicting requirements, there should be clear accountability for the system's final structure.Other potential problems may arise in these areas:Lack of centralized co-ordination of EAI work.Emerging Requirements: EAI implementations should be extensible and modular to allow for future changes.Protectionism: The applications whose data is being integrated often belong to different departments that have technical, cultural, and political reasons for not wanting to share their data with other departmentsSystem Integration (SI)?System integration (SI) is an IT or engineering process or phase concerned with joining different subsystems or components as one large system. It ensures that each integrated subsystem functions as required. SI is also used to add value to a system through new functionalities provided by connecting functions of different systems. or the last decade, the aggregation of different component systems or subsystems that cooperate to deliver a whole functionality has been the focus of industries that use technology. This is known as the modular approach to systems building, and the SI process has always been at the near-end of the development cycle. Because systems or subsystems to be integrated may span different fields in software and hardware engineering, a SI engineer must have a broad range of skills and breadth of knowledge.SI methods are as follows:Horizontal Integration: Involves the creation of a unique subsystem that is meant to be the single interface between all other subsystems, ensuring that there is only one interface between any subsystem and any may be replaced with another without affecting the others by using totally different data and interfaces. This is also known as an Enterprise Service Bus (ESB).Vertical Integration: Subsystems are integrated according to functionality by creating "silos" of functional entities, beginning with the bottom basic function upward (vertical). This very quick method only involves a few vendors and developers but becomes more expensive over time because to implement new functionalities, new silos must be created.Star Integration: Also known as "Spaghetti Integration" because each subsystem is connected to multiple subsystems, so that the diagrams of the interconnections look like a star. However, the more subsystems there are, the more connections are made, and it ends up looking like mon Data Format: Helps the system avoid having the adapter convert to and from every application format. Systems using this method set a common or application-independent format, or they provide a service that does the transformation to or from one application into the common application.Business Transaction?A business transaction, in the context of electronic commerce, is any monetary transaction that is made between consumers or businesses via the Internet. Business transactions free up time when conducted online since each party does not need to be physically present in order to make the transaction. Just one of the many advantages of online business transactions is that intermediary services are often not necessary. Electronic checking accounts have replaced the tedious process of writing a check or waiting for a check to clear. Business-to-business transactions are conducted in a speedy fashion making businesses more efficient in their day-to-day distributions and operations. Customer-to-business transactions operate more efficiently as well since business transactions conducted online result in immediate cash payments and receipts.?Businesses go to great lengths to encrypt financial data in order to keep it away from cybercriminals who may try to steal personal identifiers through illegally accessing online business transaction protected information. Despite this, the advantages of conducting online business transactions steadily outweigh the risks.Process of TransactionThe transaction is executed as a series of reads and writes of database objects, which are explained below:Read OperationTo read a database object, it is first brought into main memory from disk, and then its value is copied into a program variable as shown in figure.???????????????????????????????????????????????Write OperationTo write a database object, an in-memory copy of the object is first modified and then written to disk.???????????????????????????????????????????????ACID PropertiesA transaction is a very small unit of a program and it may contain several lowlevel tasks. A transaction in a database system must maintain?Atomicity,?Consistency,?Isolation, and?Durability ? commonly known as ACID properties ? in order to ensure accuracy, completeness, and data integrity.Atomicity?? This property states that a transaction must be treated as an atomic unit, that is, either all of its operations are executed or none. There must be no state in a database where a transaction is left partially completed. States should be defined either before the execution of the transaction or after the execution/abortion/failure of the transaction.Consistency?? The database must remain in a consistent state after any transaction. No transaction should have any adverse effect on the data residing in the database. If the database was in a consistent state before the execution of a transaction, it must remain consistent after the execution of the transaction as well.Durability?? The database should be durable enough to hold all its latest updates even if the system fails or restarts. If a transaction updates a chunk of data in a database and commits, then the database will hold the modified data. If a transaction commits but the system fails before the data could be written on to the disk, then that data will be updated once the system springs back into action.Isolation?? In a database system where more than one transaction are being executed simultaneously and in parallel, the property of isolation states that all the transactions will be carried out and executed as if it is the only transaction in the system. No transaction will affect the existence of any other transaction.SerializabilityWhen multiple transactions are being executed by the operating system in a multiprogramming environment, there are possibilities that instructions of one transactions are interleaved with some other transaction.Schedule?? A chronological execution sequence of a transaction is called a schedule. A schedule can have many transactions in it, each comprising of a number of instructions/tasks.Serial Schedule?? It is a schedule in which transactions are aligned in such a way that one transaction is executed first. When the first transaction completes its cycle, then the next transaction is executed. Transactions are ordered one after the other. This type of schedule is called a serial schedule, as transactions are executed in a serial manner.In a multi-transaction environment, serial schedules are considered as a benchmark. The execution sequence of an instruction in a transaction cannot be changed, but two transactions can have their instructions executed in a random fashion. This execution does no harm if two transactions are mutually independent and working on different segments of data; but in case these two transactions are working on the same data, then the results may vary. This ever-varying result may bring the database to an inconsistent state.To resolve this problem, we allow parallel execution of a transaction schedule, if its transactions are either serializable or have some equivalence relation among them.States of TransactionsA transaction in a database can be in one of the following states ?Active?? In this state, the transaction is being executed. This is the initial state of every transaction.Partially Committed?? When a transaction executes its final operation, it is said to be in a partially committed state.Failed?? A transaction is said to be in a failed state if any of the checks made by the database recovery system fails. A failed transaction can no longer proceed further.Aborted?? If any of the checks fails and the transaction has reached a failed state, then the recovery manager rolls back all its write operations on the database to bring the database back to its original state where it was prior to the execution of the transaction. Transactions in this state are called aborted. The database recovery module can select one of the two operations after a transaction aborts ?Re-start the transactionKill the transactionCommitted?? If a transaction executes all its operations successfully, it is said to be committed. All its effects are now permanently established on the database system.We say that a transaction has committed only if it has entered the committed state. Similarly, we say that a transaction has aborted only if it has entered the aborted state. A transaction is said to have terminated if has either committed or aborted. A transaction starts in the active state. When it finishes its final statement, it enters the partially committed state. At this point, the transaction has completed its execution, but it is still possible that it may have to be aborted, since the actual output may still be temporarily hiding in main memory and thus a hardware failure may preclude its successful completionThe database system then writes out enough?information?to disk that, even in the event of a failure, the updates performed by the transaction can be recreated when the system restarts after the failure. When the last of this information is written out, the transaction enters the committed state.CONCURRENCY CONTROLIn a multiprogramming environment where multiple transactions can be executed simultaneously, it is highly important to control the concurrency of transactions. We have concurrency control protocols to ensure atomicity, isolation, and serializability of concurrent transactions. Concurrency control protocols can be broadly divided into two categories ?Lock based protocolsTime stamp based protocolsLock-based ProtocolsDatabase systems equipped with lock-based protocols use a mechanism by which any transaction cannot read or write data until it acquires an appropriate lock on it. Locks are of two kinds ?Binary Locks?? A lock on a data item can be in two states; it is either locked or unlocked.Shared/exclusive?? This type of locking mechanism differentiates the locks based on their uses. If a lock is acquired on a data item to perform a write operation, it is an exclusive lock. Allowing more than one transaction to write on the same data item would lead the database into an inconsistent state. Read locks are shared because no data value is being changed.There are four types of lock protocols available ?Simplistic Lock ProtocolSimplistic lock-based protocols allow transactions to obtain a lock on every object before a 'write' operation is performed. Transactions may unlock the data item after completing the ‘write’ operation.Pre-claiming Lock ProtocolPre-claiming protocols evaluate their operations and create a list of data items on which they need locks. Before initiating an execution, the transaction requests the system for all the locks it needs beforehand. If all the locks are granted, the transaction executes and releases all the locks when all its operations are over. If all the locks are not granted, the transaction rolls back and waits until all the locks are granted.Two-Phase Locking 2PLThis locking protocol divides the execution phase of a transaction into three parts. In the first part, when the transaction starts executing, it seeks permission for the locks it requires. The second part is where the transaction acquires all the locks. As soon as the transaction releases its first lock, the third phase starts. In this phase, the transaction cannot demand any new locks; it only releases the acquired locks.Two-phase locking has two phases, one is?growing, where all the locks are being acquired by the transaction; and the second phase is shrinking, where the locks held by the transaction are being released.To claim an exclusive (write) lock, a transaction must first acquire a shared (read) lock and then upgrade it to an exclusive lock.Strict Two-Phase LockingThe first phase of Strict-2PL is same as 2PL. After acquiring all the locks in the first phase, the transaction continues to execute normally. But in contrast to 2PL, Strict-2PL does not release a lock after using it. Strict-2PL holds all the locks until the commit point and releases all the locks at a time.Strict-2PL does not have cascading abort as 2PL does.Timestamp-based ProtocolsThe most commonly used concurrency protocol is the timestamp based protocol. This protocol uses either system time or logical counter as a timestamp.Lock-based protocols manage the order between the conflicting pairs among transactions at the time of execution, whereas timestamp-based protocols start working as soon as a transaction is created.Every transaction has a timestamp associated with it, and the ordering is determined by the age of the transaction. A transaction created at 0002 clock time would be older than all other transactions that come after it. For example, any transaction 'y' entering the system at 0004 is two seconds younger and the priority would be given to the older one.In addition, every data item is given the latest read and write-timestamp. This lets the system know when the last ‘read and write’ operation was performed on the data item.Timestamp Ordering ProtocolThe timestamp-ordering protocol ensures serializability among transactions in their conflicting read and write operations. This is the responsibility of the protocol system that the conflicting pair of tasks should be executed according to the timestamp values of the transactions.The timestamp of transaction Ti?is denoted as TS(Ti).Read time-stamp of data-item X is denoted by R-timestamp(X).Write time-stamp of data-item X is denoted by W-timestamp(X).Timestamp ordering protocol works as follows ?If a transaction Ti issues a read(X) operation ?If TS(Ti) < W-timestamp(X)Operation rejected.If TS(Ti) >= W-timestamp(X)Operation executed.All data-item timestamps updated.If a transaction Ti issues a write(X) operation ?If TS(Ti) < R-timestamp(X)Operation rejected.If TS(Ti) < W-timestamp(X)Operation rejected and Ti rolled back.Otherwise, operation executed.Thomas' Write RuleThis rule states if TS(Ti) < W-timestamp(X), then the operation is rejected and Ti?is rolled back.Time-stamp ordering rules can be modified to make the schedule view serializable.Instead of making Ti?rolled back, the 'write' operation itself is ignored.Advantages of Concurrent Execution of TransactionThe DBMS interleaves the actions of different transactions to improve performance of system as discussed below:? Improved Throughput: Consider that transaction are performed in serial order and active transaction is waiting for a page to be read in from disk, then instead of CPU waiting for a page, it can process another transaction. This is because Input/Output activity can be done in parallel with the CPU activity. The overlapping of Input/Output activities of CPU reduces the amount of time disks and processors are idle and increases system throughput (the average number of transaction completed in a given time.)? Reduced Waiting time: Interleaved execution of a short transaction with a long transaction usually allows the short transaction to complete quickly. In serial execution a short transaction could get stuck behind a long transaction leading to unpredictable delays in response time or average time taken to complete a transaction.Managing Data ResourcesIntroductionIn this study session, you be discussing how to manage data resources. You will begin by describing the relationship between an organization and data management. You will further the discussion by evaluating how data is organised in a traditional file environment. Thereafter, you will describe file organization terms and concept. You will also describe the database management system. Under which you will look at the logical and physical views of data, how to design database, comparing of database alternative and how to create a data base. Moving on, you will discuss the different trends in database management. Likewise, you will describe the management database requirements. The session will end with a discussion on database environment and applications.Learning Outcomes17830808890000When you have studied this session, you should be able to:6.1discuss organization and data management6.2define database management systemsOutcomes6.3 explain database trends6.4highlight management requirement6.5describe database environmentOrganisations and Data ManagementIt has been very difficult for organizations to manage their data effectively. In trying to do so, we have to meet two very big challenges which are standing out. Implementing a database requires a widespread organisational change in the role of information and information managers, the allocation of power at all senior levels, the ownership and sharing of information and patterns of organisational agreement. A database management system (DBMS) challenges the existing power arrangements in an organisation and for that reason often generate political resistance. In a traditional file environment, each department constructed files and programs to fulfil its specific needs. Now, with a database, files and programs must be built that take into account the full organization’s interest in data. Although the organisation has spent the money on hardware and software for a database environment, it may reap the benefits it should if it is unwilling to make the requisite organisational changes.Moving to database environment can be a costly long-term process. In addition to the cost of DBMS Software, related hardware, and data modelling, organizations should anticipate heavy expenditure for integrating, merging and standardizing their data that will populate their database to eliminate inconsistencies, redundancies and errors that typically arise when overlapping data are stored and maintained by different systems and different functional areas.You should understand the managerial and organisational requirements as well as the technologies for managing data as a resource. Organizations need to manage their data assets very carefully to make sure that the data can be easily accessed and managed by the managers and employees across the First, we describe the typical challenges facing business trying to access information using traditional file management technologies. Then we describe the technology of database management systems, which can overcome many of the drawbacks of traditional file management systems and provide the firm wide integration of information required for digital firm anizing Data in a Traditional File EnvironmentInformation is becoming as important a business resource as money, material, and people. Businesses are realizing the competitive advantage they can gain over their competition through useful information, not just data. Why should you know about organizing data? Because it’s almost inevitable that someday you’ll be establishing or at least working with a database of some kind. As with anything else, understanding the lingo is the first step to understanding the whole concept of managing and maintaining information. It all comes down to turning data into useful information, not just a bunch of bits and bytes.6.1.2 File Organization Terms and Concepts17830809588500Figure 6.1: Data hierarchy in traditional file management system (Source:)The data hierarchy in traditional file management system The first few terms, field, record, file, database, are depicted in Figure 8.1, which shows the relationship between them. An entity is basically the person, place, thing, or event about which we maintain information. Each characteristic or quality describing an entity is called an attribute. Each record requires a key field, or unique identifier. The best example of this is your Customer_ID Number: there is only one per person. That explains in part why so many companies and organizations ask for your PAN Number when you do business with them. Suppose you decide to create a database for your newspaper delivery business. To succeed, you need to keep accurate, useful information for each of your customers. You set up a database to maintain the information. For each customer, you create a record. Within each record you have the following fields: customer name, address, ID, date last paid. Smith, Jones, and Brooks are the records within a file you decide to call Paper Delivery. The entities then are Smith, Jones, and Brooks, the people on whom you are maintaining information. The attributes are customer name, address, ID, and date last paid. The key field in this file is the ID number; perhaps you’ll use their phone number, since it will be unique for each record. This is a simplistic example of a database, but it should help you understand the terminology.Accessing RecordsWhen we were describing secondary storage, we talked about magnetic tape and disk storage for computer data. To understand how information is accessed from these mediums, think about the difference between a music cassette tape and a music CD. If you want to get to a particular song on a cassette tape, you must pass by all the other songs sequentially. If you want to get to a song on CD, you can go directly to that song without worrying about any of the others. That is the difference between sequential and direct access organization for database records.Sequential file organization, in conjunction with magnetic tape, is typically used for processing the same information on all records at the same time. It is also good for processing many records at once, commonly called batch processing.Direct or random file organization is used with magnetic disks. Because of increased speed and improved technological methods of recording data on disks, many companies now use disks instead of tapes. The other advantage that disks have over tapes is that disks don’t physically deteriorate as fast as tapes do. There is less danger of damaging the surface of the disks than there is of breaking a tape.Indexed Sequential Access MethodTo explain the indexed sequential access method (ISAM), let’s go back to the example of the cassette tape. A cassette tape label has a printed list of the songs contained on it which gives you a general idea of where to go on the tape to find a particular tune. So too with computer records on a sequential access tape using the key field. It gives the computer a pretty accurate idea of where a particular record is located. That’s why it’s so important to have a unique ID as the key field. You and your customer could have a difficult time if the key field is duplicated among several records. Each key field and the ultimate location of that record on the storage device is maintained in the index.Direct file access methodThis access method also uses key fields in combination with mathematical calculations to determine the location of a record. If you order something by phone from a mail order catalogue, the person taking your order does not have to wait for the computer to randomly select your record; using the direct file access method, the computer can find you very quickly. Here, you have understand that the records are not stored sequentially but at random. The transform algorithm uses the value in the key field to find the storage location and access the record.Problems with the Traditional File EnvironmentMany problems, such as data redundancy, program-data dependence, inflexibility, poor data security, and inability to share data among applications, have occurred with traditional file environments. We’ve spoken about “islands of information” before. Building and maintaining databases is where this situation is most evident and most troublesome. Usually it begins in all innocence, but it can quickly grow to monstrous proportions. For instance, after you move and change addresses, you notify everyone of your new address, including your bank. Everything is going smoothly with your monthly statements. All of a sudden, at the end of the year, the bank sends a Christmas card to your old address. Why? Because your new address was changed in one database, but the bank maintains a separate database for its Christmas card list and your address was never changed in it. If you received two Christmas cards, you’re probably a victim of data redundancy. That is, your information is now in two separate databases with duplicate records. In this instance, each database file has different data on the same record. That can be a nightmare on Main Street. Even more troublesome is when several departments or individuals decide to set up their own islands of information. This usually happens because they find the main system inflexible or it just doesn’t fit their needs. So they set up their own fields and records and files and use them in their own programs to manipulate data according to their needs.Now each department is spending lots of money and time to establish and maintain separate islands of information. Even worse, the fields and records for Marketing probably don’t have the same structure and meaning as the fields and records for Accounting, or those for Production. Each record describes basically the same entity (customers or products), but it is very possible that each database file will have different information, or attributes, in records concerning the same entity. All of this may have happened with the best of intentions. All the departments began with the goal of making their part of the organization more efficient. Eventually these good intentions can cost big dollars to bring the islands together, resolve data conflicts between them, and retrain people to understand the new database structures. Managers and workers must know and understand how databases are constructed so they know how to use the information resource to their advantage. Managers must guard against problems inherent with islands of information and understand that sometimes resolution of short-term problems is far costlier in the long term.531114052705000562800552705000Database Management SystemsThe key to establishing an effective, efficient database is to involve the entire organization as much as possible, even if everyone seemingly will not be connected to it or be a user of it. Perhaps they won’t be a part of it in the beginning, but they very well could be later on. You’ve heard the old saying, “Don’t put all your eggs in one basket.” When it comes to data, just the opposite is true. You want to put all your corporate data in one system that will serve the organization as a whole. A Database Management System (DBMS) is basically another software program like Word or Excel or Email. This type of software is more complicated: it permits an organization to centralize data, manage them efficiently, and provide access to the stored data by application programs. A DBMS has 3 components, all of them are important for the long-term success of the system.Data Definition Language (DDL). Marketing looks at customer addresses differently from Shipping. So you must make sure that all users of the database are speaking the same language. Think of it this way: Marketing is speaking French, Production is speaking German, and Human Resources is speaking Japanese. They are all saying the same thing, but it’s very difficult for them to understand each other. Defining the data definition language itself sometimes gets shortchanged. The programmers who are creating the language sometimes say “Hey, an address is an address, so what.” That’s when it becomes critical to involve users in the development of the Data Definition Language.Data Manipulation Language (DML). This is a formal language used by programmers to manipulate the data in the database and make sure they are formulated into useful information. The goal of this language should be to make it easy for users. The basic idea is to establish a single data element that can serve multiple users in different departments depending on the situation. Otherwise, you’ll be tying up programmers to get information from the database that users should be able to get on their own.Data Dictionary. Each data element or field should be carefully analysed to determine what it will be used for, who will be the primary user, and how it fits into the overall scheme of things. Then write it all down and make it easily available to all users. This is one of the most important steps in creating a good database. Why is it so important to document the data dictionary? Let’s say Suvidha, who was in on the initial design and building of the database, moves on and Joe takes her place. It may not be so apparent to him what all the data elements really mean, and he can easily make mistakes from not knowing or understanding the correct use of the data. He will apply his own interpretation, which may or may not be correct. Once again, it ultimately comes down to a persware problem.QuestionHow will you define DBMS?FeedbackYour definition should reflect the fact that DBMS is basically another software program like Word or Excel or Email but more complicated which permits an organization to centralize data, manage them efficiently, and provide access to the stored data by application programs.Logical and Physical Views of DataPhysical views of items are often different from the logical views of the same items when they are actually being used. For instance, assume you store tablets of paper in your lower right desk drawer. You store your pencils in the upper left drawer. When it comes time to write your request for a pay raise, you pull out the paper and pencil and put them together on your desktop. It isn’t important to the task at hand where the items were stored physically; you are concerned with the logical idea of the two items coming together to help you accomplish the task. The physical view of data cares about where the data are actually stored in the record or in a file. The physical view is important to programmers who must manipulate the data as they are physically stored in the database. Does it really matter to the user that the customer address is physically stored on the disk before the customer name? Probably not. However, when users create a report of customers located in Indiana they generally will list the customer name first and then the address. So it’s more important to the end user to bring the data from their physical location on the storage device to a logical view in the output device, whether screen or paper.Database Management Systems have three critical components: the data definition language, the data manipulation language, and the data dictionary. Managers should ensure that all three receive attention. Managers should also make sure that end users are involved in developing these three components.Designing DatabasesEvery tool has its job. You wouldn’t use a screwdriver to pound a nail in the wall (or maybe you would), nor would you use a hammer to turn a bolt. Each type of database that we discuss in this section has its own advantages and disadvantages, so you should choose the right type of database for the job you want to do.Hierarchical DatabasesThe hierarchical data model presents data to users in a treelike structure. Think of a mother and her children. A child only has one mother and inherits some of her characteristics, such as eye color or hair color. A mother might have one or more children to which she passes some of her characteristics but usually not exact ones. The child then goes on to develop its own characteristics separate from the mother.17830806985000Figure 6.2: A hierarchical database for a human resources system.(Source: )In a hierarchical database, characteristics from the parent are passed to the child by a pointer just as a human mother will have a genetic connection to each human child. You can see how this database pointer works by looking at Figure 6.work DatabaseA network data model is a variation of the hierarchical model. Take the same scenario with one parent and many children and add a father and perhaps a couple of stepparents. Now the parents aren’t restricted to only one (the mother) but to many parents. That is, a parent can have many children and a child can have many parents. The parents pass on certain characteristics to the children, but the children also have their own distinct characteristics.17862555969000Figure 6.3: Network Data Model (Source: )The network data model. As with hierarchical structures, each relationship in a network database must have a pointer from all the parents to all the children and back, as the above figure demonstrates. These two types of databases, the hierarchical and the network, work well together since they can easily pass data back and forth. But because these database structures use pointers, which are actually additional data elements, the size of the database can grow very quickly and cause maintenance and operation problems.Relational Data ModelA relational data model uses tables in which data are stored to extract and combine data in different combinations. The tables are sometimes called files. In a relational database, each table contains a primary key, a unique identifier for each record. To make sure the tables relate to each other, the primary key from one table is stored in a related table as a secondary key. For instance, in the Customer table the primary key is the unique Customer ID. That primary key is then stored in the Order Table as the secondary key so that the two tables have a direct relationship. Use these three basic operations to develop relational databases:Select: create a subset of records meeting the stated criteriaJoin: combine related tables to provide more information than individual tablesProject: create a new table from subsets of previous tablesThe biggest problem with these databases is the misconception that every data element should be stored in the same table. In fact, each data element should be analysed in relation to other data elements with the goal of making the tables as small in size as possible. The ideal relational database will have many small tables, not one big one. On the surface that may seem like extra work and effort, but by keeping the tables small, they can serve a wider audience because they are more flexible. This setup is especially helpful in reducing redundancy and increasing the usefulness of data.Advantages and DisadvantagesHierarchical and network databases can be very efficient as long as you plan ahead. But as you know, needs change, and neither one of these databases offers a lot of flexibility to change with business needs. It’s sort of like parents and children; once you establish the tie, it’s pretty hard to amend. Relational database management systems are more flexible, especially if you keep the tables small. It is much easier for non-techies to create the query language in a relational system. It’s also easier to add new data elements, although if you do, you’ll have to go back and fill in the missing information for the old records or just forget them paring of Database AlternativesThe above table compares these alternatives on several dimensions to show you the advantages and disadvantages of each. What you should remember is that none of these databases is very good if you don’t keep the end user in mind. If you’re not careful, you’ll wind up with lots of information that no one can use.Creating a DatabaseFirst, you should think long and hard about how you use the available information in your current situation. Think of the good and the bad of how it is organized, stored, and used. Now imagine how this information could be organized better and used more easily throughout the organization. What part of the current system would you be willing to get rid of and what would you add? Involve as many users in this planning stage as possible. They are the ones who will prosper or suffer because of the decisions you make at this point.Determine the relationships between each data element that you currently have (entity-relationship diagram). The data don’t necessarily have to be in a computer for you to consider the impact. Determine which data elements work best together and how you will organize them in tables. Break your groups of data into as small a unit as possible (normalization). Even when you say it’s as small as it can get, go back again. Avoid redundancy between tables. Decide what the key identifier will be for each record. See, you’ve done all this and you haven’t even touched the computer yet!Give it your best shot in the beginning: it costs a lot of time, money, and frustration to go back and make changes or corrections or to live with a poorly designed database. There are three types of databases: hierarchical, network, and relational. Relational databases are becoming the most popular of the three because they are easier to work worth, easier to change, and can serve a wider range of needs throughout the organization. Database TrendsRecent database trends include the growth of distributed databases and the emergence of object-oriented and hypermedia databases.Distributed DatabasesThese are usually found in very large corporations that require multiple sites to have immediate, fast access to data. As the book points out, there are lots of disadvantages, so you should be careful in determining if this is the right way for you to run your business.Object-Oriented and Hypermedia DatabasesMany companies are steering away from strictly text-based database systems. Data as objects can be pictures, groups of text, voice, audio, etc. Object-oriented databases bring the various objects from many different sources and get them all working together. As we move away from strictly text-based information systems and incorporate video and sound, graphics and text, the hypermedia database will become more common. The below given figure helps explain the concept of a hypermedia database by showing how the various elements are networked. The attraction to this type of database is that it allows the user to decide which path to follow from one node to another.1828808890000Figure 6.4: A hypermedia database for the electronic educational environment (Source: Norman, 1991).Multidimensional Data AnalysisAs technology improves, so does our ability to manipulate information maintained in databases. Have you ever played with a Rubik Cube - one of those cute little multicolour puzzle boxes you can twist around and around to come up with various colour combinations? That’s a close analogy to how multidimensional data analysis or on-line analytical processing (OLAP) works (see the Figure given below). In theory, it’s easy to change data around to fit your needs.Data WarehousesAs organizations want and need more information about the company, the products, and the customers, the concept of data warehousing has become very popular. Remember those islands of information we keep talking about? Unfortunately, too many of them have proliferated over the years, and now companies are trying to rein them in using data warehousing. No data warehouses are not great big buildings with shelves and shelves of bits and bytes stored on them. They are huge computer files that store old and new data about anything and everything a company wants to maintain information on. Since the data warehouse can be cumbersome, a company can break the information into smaller groups called data marts.It’s easier and cheaper to sort through smaller groups of data. It’s still useful to have a huge data warehouse, though, so that information is available to everyone who wants or needs it. You can let the user determine how the data will be manipulated and used. Using a data warehouse correctly can give management a tremendous amount of information that can be used to trim costs, reduce inventory, put products in the right stores, etc.Linking Databases to the WebEven though Web browsers have been around for only a few years, they are far easier to use than most of the query languages associated with the other programs on mainframe computer systems. That’s why many companies are starting to link their databases to a Web-like browser. They are finding out that it’s easier to provide their “road warriors” with Web-like browsers attached to the computer at the main office. Employees anywhere can have up-to-the-minute access to any information they need. It’s also proving cheaper to create browser applications that can more easily link information from disparate systems than to try to combine all the systems. There are many ways to manipulate databases so that an organization can save money and still have useful information. With technological improvements, companies don’t have to continually start from scratch but can blend the old with the new when they want to update their systems.Management RequirementsKey organizational elements in the database environment. Nothing is ever as easy as it sounds. There is a lot more to a viable, useful database than just its structure as shown in Figure 6.5 below.1828808890000Figure 6.5: Database Structure (Source: )Data AdministrationAsk any manager what his resources are and he’s likely to list people, equipment, buildings, and money. Very few managers will include information on the list, yet it can be more valuable than some of the others. A data administration function, reporting to senior management, can help emphasize the importance of this resource. This function can help define and structure the information requirements for the entire organization to ensure it receives the attention it deserves Data Administration is responsible for:Developing information policiesPlanning for dataOverseeing logical database designData dictionary developmentMonitoring the usage of data by techies and non-techiesNo one part of the organization should feel it owns information to the exclusion of other departments or people in the organization. A certain department may have the primary responsibility for updating and maintaining the information, but that department still has to share it across the whole company. Well-written information policies can outline the rules for using this important resource, including how it will be shared, maintained, distributed, and updated.Data PlanningAt the beginning we said that as many users as possible should be brought together to plan the database. We believed it so much then that we’ll say it again here. By excluding groups of users in the planning stages, no matter how insignificant that group may seem a company courts trouble. Database Technology, Management and UsersChange isn’t just something you experience by chance; in all likelihood, it will be required throughout the corporate structure. You need to get the non-techies talking and working with the techies. Users will take on more responsibility for accessing data on their own through query languages if they understand the structure of the database. Users need to understand the role they play in treating information as an important corporate resource. Not only will they require a user friendly structure for the database, but they will also need lots of training and hand holding up front. It will pay off in the long run.Database administration functions can:Define and organize database structure and content.Develop security procedures to safeguard the database.Develop database documentation.maintain the database management software.As with any other resource, managers must administer data, plan their uses, and discover new opportunities for the data to serve the organization through changing technologies.The Database Environment and ApplicationsNow, we are having basic understanding about the databases and the requirements of the management and the organisation. Let us continue by knowing the database environment which will give you a clear idea about how it is performing. Let us recall what we learned earlier in this chapter. Database is an organized collection of logically related data. Information data that was processed to increase the knowledge of the person who uses it. Example, the bank that owns your ATM card is collecting data about your transactions (date, amount, time, location, ATM No, etc). The monthly statement contains information about your account. The bank maintains a database of related data such as your name and address, the amount of money you transfer and where you transfer it to and the ATM transaction information.The Range of Database ApplicationsA database Application is a set of programs that were developed to support the needs of the database users. The application is used to perform the basic function of adding new data, modifying or deleting data, or reading data to create meaningful information, such as the invoice shown above. Database applications are divided into five categories; from a single user on a personal databases, to workgroup, departmental, enterprise, and Internet/Intranet/Extranet databases.Personal databases: Designed to support one user and are used for simple applications, typically developed by the end userWorkgroup Database : Small team of professionals who collaborate on the same project. e.g., a team of systems analysts developing an information system will share a common database to create their schema, programs and documents. The workgroup members use PCs that are linked by the way of a local area network (LAN). The database is managed by a computer, called database server, which is part of the network.Department Databases : A department is a function within the organization such as accounting, and marketing. The databases are designed to support the function of the organization. For a marketing department the database would tracks data concerning customer, orders, and salespersonsEnterprise Database: An enterprise database supports the entire enterprise (all the departments). At times a single enterprise database isn’t practical, so multiple databases are maintained. This is due to performance issues, diverse needs of users, and complexity of systems. Enterprise databases include: (1) Enterprise resource planning (ERP) and (2) Data warehousing.ERP systems have evolved from the material requirement (MRP) and manufacturing resource planning (MRP II) systems of the 1970s and 1980s. The ERP systems include additional functionality such as customer resource management, and personnel. Because of the complexity of ERP systems, a database is a must work with current operational data of the enterprise, data in the data warehouse are derived by extracting and basis. Users work with the historical data of the warehouse to identify patterns and trends and answer strategic business questions. Data warehousing is discussed later in the course.Internet, Intranet, and Extranet DatabasesThe internet is the most recent change that had a tremendous effect on businesses and their information systems and databases. The internet is a worldwide network that easily enables users with multiple platforms, to22034573025005530857302500connect, using a web browser (Netscape or Explorer). The databases must be made web-enabled to allow customers process data on the databases. Companies also use the internet technology to link their internal databases such as personnel, e-mail. This network is known as Intranet. Intranet is protected by software known as fire wall to protect ii from access by people outside the company. Using the internet, companies can do business online with their customers, providing better service at reduced cost. E.g., Dell Computers is selling computers primarily online, and Oracle Corporation reported a saving of one billion dollar per year by configuring systems and processing orders via the internet. This interaction is referred to as business-to-customer (B to C). Using the internet, companies can develop Extranet to exchange data with their suppliers and other companies, known as business-to-business (B to B). Typically the access to the company intranet is restricted to only certain companies and restricted data.ITQQuestion:What does database application mean to you.Feedback:Whatever is it that it means don’t forget that a database application is a set of programs that were developed to support the needs of the database users.581660351155005816603638550058166037592000Study Session Summary178308016827500In this study session, you discussed how to manage data resources. You started with a discussion on the relationship between organizations and data management. Also, you looked at how data are organised in a890270-45974000Summarytraditional file environment. Furthermore, you describe the database management system, the database trends and management database requirements. You ended the session by examining the database environment and the range of database applications.3164782482210SETTING UP A QUICKBOOKS BUSINESS Learning Objectives By the end of this chapter the learner shall be able to; Create a company in QuickBooks Review chart of Accounts Create customers vendors and items lists Number accounts in QuickBooks 4.1 Getting started Checklist 4.2 Creating your company file To create your company file: ? Start QuickBooks by double-clicking the QuickBooks icon on the desktop or clicking the Windows Start button and then clicking QuickBooks from the Programs group. ? Click Create a new company file, or go to the File menu and click New Company. ? The Welcome screen for the EasyStep Interview opens. Click Start Interview. Note: We recommend that you do not skip the interview process. The more information you enter with the EasyStep Interview, the more accurate your company file will be when you begin to use QuickBooks for your business. However, if you are an experienced QuickBooks user and prefer to create your company file manually, you can skip the EasyStep Interview by clicking Skip Interview on the EasyStep Interview Welcome screen. You will be prompted to enter some basic company information and to save the company file. ? Follow the onscreen instructions and complete the interview. Completing your company setup After you’ve created your company file, you can begin using QuickBooks to run your business. But before you do, we recommend that you review the information in this section to make sure your company file is properly set up and that your data is complete. This section describes some additional tasks you might need to do as you begin using QuickBooks. Depending on how much information you entered during the EasyStep Interview, some of these tasks might not apply to you. Enter your company information Do this task if you did not enter this information in the EasyStep Interview. To enter the contact and legal information for your company, go to the Company menu and click Company Information. To learn more about each of the fields and where the information you enter will be used in QuickBooks, click the Help button. Review your Chart of Accounts If you used the EasyStep Interview, a chart of accounts based on your type of business was set up for you. Review the chart of accounts to be sure it accurately reflects the accounts you need to run your business. You can change account names and edit, delete, or add accounts as necessary. For example, you will need to add any businessrelated bank, credit card, or loan accounts. To view your Chart of Accounts, go to the Lists menu and click Chart of Accounts. Numbering your accounts Some businesses prefer to organize their accounts by number. Adding numbers can help you identify the type of accounts, thereby speeding up your account selection on various forms. You might want to develop and follow a consistent account naming and numbering convention. For example: 10000-19999 - Assets 20000-29999 - Liabilities 30000-39999 - Equity 40000-49999 - Income 50000-59999 - Cost of Goods Sold 60000-69999 - Expenses (or Operating Expenses) 70000-79999 - Other Income (not related to daily activity) 80000-89999 - Other Expenses (not related to daily activity) If you want to use numbers to identify your accounts, you need to turn on this preference in QuickBooks, as follows. ? Go to the Edit menu and click Preferences. ? In the Preferences window, click Accounting in the list on the left. ? Click Company Preferences. ? Select the Use account numbers checkbox. ? Click OK. 4.3 Creating your customer and vendor list Create your customer, vendor, and items lists To bill customers and pay your bills with QuickBooks, you must update your customer, vendor, and item lists so that they accurately reflect your business. Instructions for setting up these lists are provided in the adding vendors and customers section: You can choose to enter this information all at once, or you can enter it as you work, using the Quick Add feature. Enter historical transactions If your start date is before today’s date, you’ll need to enter past transactions from the start date to today. This ensures that your QuickBooks records are completely up-todate and your reports will be accurate. Enter historical transactions in chronological order. For example, QuickBooks won’t know how to credit a customer payment unless you’ve previously recorded the invoice to that customer. The most efficient way to enter historical transactions is in the account register. Note: Entering historical transactions is especially important if customers don’t pay you at the time they receive goods or services. If you don’t enter historical transactions early on, it’s hard to track and collect late customer payments. Intuit recommends that you enter your transactions in this order (verify with accountant): Invoices you’ve sent out since your start date Purchase orders you’ve issued since your start date that you haven’t received in full Cash or checks you’ve received since your start date Bills you’ve received since your start date Bills you’ve paid since your start date Deposits you’ve made to any of your accounts since your start date Any other checks you’ve written (for things other than bills) since your start date Employee year-to-date information paid from January 1 through your start date ? Payroll liabilities owed at the time of your start date (for manual payroll and tracking payroll transactions only) Note: If you don’t have time to enter all your historical transactions right away, don’t worry. You don’t need to enter all your past transactions before you start using QuickBooks for new transactions. Enter new transactions as they occur. Then catch up with historical transactions when you can. Remember, though, that your account balances will be incorrect (and your reports may be wrong) until you enter all the past transactions. Complete your bank account information After you’ve entered your historical transactions, your account registers will contain entries reflecting bills you’ve paid, checks and paychecks you’ve written, and deposits you’ve received. To make your account registers complete, you must also enter these transactions: Checks or other charges that happened before your start date but didn’t appear on statements before your start date (i.e., didn’t clear) Other checks you wrote after your start date that were not for bills or accounts payable (for example, credit card payments) 24 Deposits you made after your start date that were not customer deposits Deposits you made before your start date but that didn’t appear on statements before your start date Bank charges and fees Interest paid on your account Refer to the in-product Help for step-by-step instructions on how to enter these transactions to make your account registers accurate. Backing up your company file The QuickBooks backup file is a compressed version of your QuickBooks company file that contains all transactions through the date the company backup was made. A backup file provides insurance against accidental data loss and can be used to restore your data. QuickBooks backups have a .qbb extension and cannot be opened directly. QuickBooks provides several backup options for securing your data: Standard backup Portable Company File To use one of the backup options, go to the File menu and click Save Copy or Backup. To restore your backup, go to the File menu and click Open or Restore Company. To learn more about backing up your company file, refer to the in-product Help. Quick books learning centre. CHAPTERSEVENMAIN QUICKBOOKS FEATURES28355211539200 Learning Objectives By the end of this chapter the learner shall be able to; The use the QuickBooks work area Find data in QuickBooks centers Use customer centre, vendor centre and employee centre 5.1 Getting Around QuickBooks The QuickBooks work area, shown in Figure 2, is designed to enable you to complete tasks quickly. QuickBooks provides several ways for you to work; choose the method that works best for you Using the Home page to move around in QuickBooks When you open a company file in QuickBooks, the Home page is displayed automatically. The QuickBooks Home page provides a big picture of how all your essential business tasks fit together. Tasks are organized into logical categories (Customers, Vendors, Employees, Company, and Banking) with workflow arrows to help you learn how tasks relate to each other and to help you decide what to do next. Note: The workflow arrows indicate a logical progression of business tasks in QuickBooks. However, these arrows do not restrict you from doing tasks in a different order, or an order that works better for your business needs. To start a task, simply click the icon for the task you want to do. For example, to create an invoice, click the Invoices icon. To return to the Home page, click the Home button on the navigation bar. The Home page also provides a quick glance about the state of your business. You can see your current account balances, updated automatically as you do work in QuickBooks, in the Account Balances list. The Home page you see has been customized to display only those tasks and features that you use, based on the questions you answer in the EasyStep Interview. Functions you don’t need won’t clutter your workspace. However, to add these functions later, you can turn them on in preferences. Go to the Edit menu and click Preferences. Click the Desktop View option and then click the Company Preferences tab. If you’re a new business owner or new to QuickBooks, the QuickBooks Coach will walk you through the business flows you see on your Home page. The QuickBooks Coach uses spotlights and tips to explain each step in your workflow. Turn coach tips on and then mouse over and click the Coach icons ( ) to see tips and spotlights. 5.2 Finding your data in QuickBooks centers QuickBooks includes Customer, Vendor, and Employee Centers where you can view and manage all of your customer, vendor, and employee information and transactions. You can go to one of the QuickBooks Centers by clicking the appropriate button in the navigation bar (on the left side of the toolbar). Customer Center The Customer Center, shown in Figure 3, is a lens into all your customer information. Without having to sift through multiple screens, you can view a list of all your customers and see pertinent information for each of them. Click on a customer’s name and you’ll immediately see all the activity you’ve had with them as well as their pertinent contact information (phone number, fax number, and payment terms). You can use the Customer Center to find out how much money a specific customer owes you or to view a list of all your customers with open balances. You can also look at all your customer transactions (estimates, sales orders, invoices, credit memos, refunds, etc.) across all of your customer in the Transactions list rather than having to run separate reports. Vendor Center The Vendor Center gives you a complete picture of where your money is going. From one screen, you can see all your vendors and exactly what you owe them. Simply click a vendor’s name to view your entire history with that vendor. You no longer need to run separate reports to see exactly how much business you’re doing with each individual vendor. And, you can sort your bills by due date so you can stay on top of your finances. If you need to talk to a vendor, click their name and you’ll see all their contact information. If a vendor calls you to follow up on a late payment, you can quickly look up the bill and see when you paid it and what the check number was. Employee Center From the Employee Center, you can see exactly what you’re paying each employee. Simply click an employee’s name to view that person’s payroll history. And if you need to get in touch with an employee, their contact information is right in front of you. Payroll Center If you subscribe to one of the QuickBooks Payroll services (additional fees apply), the Employee Center includes a Payroll Center. Use the Payroll Center to manage your payroll and payroll compliance.1 The Payroll Center is the hub for managing all payroll activities. The Payroll Center reminds you of important payroll dates so you pay your employees, pay your payroll liabilities, and file forms on time. To check out the Payroll Center, click the Employee Center icon on the navigation bar and then click the Payroll tab. 5.3 Using in-product Help QuickBooks in-product Help provides background information and instructions for doing QuickBooks tasks. You can access the Help content and features in several ways. To use in-product Help, go to the Help menu and click QuickBooks Help. Viewing Help for a window you have open If you are unsure how to use a particular QuickBooks window, press the F1 key on your keyboard. To get help. (You can also click the Help button in the window, if one is present.) These Help topics provide answers to questions such as: What can I use this form for? What does this button do? What kind of information is displayed in this column? What happens when I select this option? QUICKBOOKS BASICS Learning Objectives By the end of this chapter the learner shall be able to; i. Work with QuickBooks lists ii. Write checks and pay bills iii. Add different types of accounts in QuickBooks such as the income and the expense Learning Objectives By the end of this chapter the learner shall be able to; i. Work with QuickBooks lists ii. Write checks and pay bills iii. Add different types of accounts in QuickBooks such as the income and the expense To take full advantage of QuickBooks, there are some important concepts you need to understand. 6.1 Working with QuickBooks lists Lists are one of the important building blocks that make QuickBooks so powerful and efficient. QuickBooks uses list information to fill out most QuickBooks forms. For example, to create an invoice, you choose the customer name from your Customers & Jobs list. QuickBooks automatically enters the customer information on the form for you. This saves you time and prevents typing errors. You can also change the information directly on the form as needed. Lists are easy to set up in QuickBooks, but do require careful planning. Depending on the type of list you want to use, you can get to the list in one of two ways: QuickBooks Centers: Your Customers & Jobs, Vendors, and Employees lists are available in the Customer, Vendor, and Employee Center, respectively. Click the appropriate QuickBooks Center button on the navigation bar to go to a QuickBooks Center. List windows: Other lists, such as the Chart of Accounts and Item List, appear in separate windows. To view one of these lists, click the Lists menu and then click the list you want. To enter information in these lists, use the menu button at the bottom of the list to add, edit, or delete list items. The menu also provides access to common features associated with the list. The more detail you enter for each list item, the more information QuickBooks can use to pre-populate forms, track financial data, and display useful reports about your business. Another advantage of lists is that common tasks like adding list entries, editing list information, and deleting list entries are performed the same way. Figure 4 illustrates how QuickBooks uses list information across multiple windows and tasks to simplify data entry and to give you a complete picture of how your business is doing. 6.2 Writing checks versus paying bills In QuickBooks, you can manage your bills and payments in two ways: Write checks to pay bills now. Use the Write Checks window and assign the amounts to appropriate expense accounts. This method is recommended when you don’t receive a bill, such as when you go to the store and write a check and then you need to record that expense in QuickBooks. You can also use Write Checks to pay a bill as soon as you receive it, as long as you don’t need to track the bill. Enter bills when you receive them and pay them later. Use the Enter Bills window to enter bills when you receive them. Then use the Pay Bills window to pay bills when they are due. You can set up QuickBooks to remind you to pay bills when they are due. Using this method, you keep your money in your business for as long as possible. You might still use a check to pay the bill, but this method enables you to track how much money you owe. And at any time, you can run reports to analyze unpaid bills for information such as which vendors you owe money. Note: Do not simply write a check in the Write Checks window to pay bills that you entered in the Enter Bills window or the accounts payable registers. 6.3 QuickBooks Essential Tasks Adding an Account When you set up your company file, QuickBooks sets up certain accounts for you automatically. However, as your business grows or changes, you might need to add new accounts to your chart of accounts to better organize your finances. Or, you might need an account that was not provided during setup. For example, you might want to create expense accounts to track office supply purchases separately from advertising costs. To add an account: ? Go to the Lists menu and click Chart of Accounts. ? Click the Account button and then click New. ? In the Add New Account: Select Account Type window, select the type of account you want to create and then click Continue. ? Enter the account’s name in the Account Name field. This name will appear on your company financial statements. ? If you want to make this account a subaccount of another account, select the Subaccount of checkbox. From the drop-down list, click the account that will be the higher-level account for this subaccount. ? (Optional) Enter a short description, note, bank account number, or credit card number, depending on the type of account you are adding. ? For income and expense accounts. From the Tax-Line Mapping drop-down list, click the appropriate tax line or <Not tax-related>. ? For balance sheet accounts. Enter an opening balance based on the account’s balance as of your QuickBooks start date. Generally, you should enter any balance sheet balances as of the day before your start date. That way it’s all exactly correct at the opening of your start date. If you’re putting money into the account with a transaction, do not use the opening balance field, since this will create an additional transaction. If you’re not sure of the balance, you can leave the field blank and enter the information later. Click OK when finished. ? Click Save & Close or Save & New to add another account. Why Use Subaccounts? ? Click Save & Close or Save & New to add another account. Why Use Subaccounts? When you need more detail about what’s going on in an account, you can divide the account into one or more subaccounts. Subaccounts let you track several related types of income or expenses independently yet keep them all under the ―umbrella of a single parent account. Subaccounts appear indented immediately below their parent account in your chart of accounts. If you create subaccounts, it’s best not to post anything to the ―parent account For example, if your business has substantial advertising expenses, you might decide to divide your Advertising expense account into several subaccounts, such as Newspaper Ads, Signs, Yellow Pages Listing, and Direct Mailings. What type of account should I use? There are two main types of accounts in the QuickBooks chart of accounts: Income and expense accounts Balance sheet accounts Income and Expense Accounts Income and expense accounts track the sources of your income and the purpose of each expense. When you record transactions in one of your balance sheet accounts, you usually assign the amount of the transaction to one or more income or expense accounts. For example, not only do you record that you took money out of your checking account, but you keep track of what you spent the money on (utilities or office supplies). Note: QuickBooks does not display balances for income and expense accounts in the Chart of Accounts. To see these balances, go to the Reports menu, click Report Center, and then click the Company & Financial category. You can also select the income or expense account in the chart of accounts and click QuickReport. Balance Sheet Accounts QuickBooks provides 10 types of balance sheet accounts to choose from as you create and add to your Chart of Accounts. Use the type of account that best describes the type of data you are tracking. 6.4 Adding Customers Vendors and other accounts Adding Customers Customers are the lifeline of your business. By entering detailed information in QuickBooks about the people and companies to whom you sell your products and services, you can personalize their bills, send invoices easily, and quickly view the status of their accounts. You can add new customers at any time. To add a customer: ? Click the Customer Center icon at the top of the QuickBooks window. ? Click New Customer & Job and then click New Customer. ? On the Address Info tab, enter all the data that you have about the customer, including their name, Bill to and Ship to addresses, and additional contact information. ? Complete the Additional Info and Payment Info tabs, as appropriate. ? If you want to add additional fields to the form, click Define Fields to customize the form. ? Click OK or Next (if you want to enter another customer). Adding Vendors QuickBooks uses the vendor list to hold information about the people and companies you buy goods and services from to run your business; for example, this list could include the phone company, your office supplies vendor, and your tax board. You can add new vendors at any time. To add a vendor: To add a vendor: ? Click the Vendor Center icon at the top of the QuickBooks window. ? Click New Vendor. ? On the Address Info tab, enter all the data that you have about the vendor, including their name, address, and additional contact information. ? If you owe this vendor money as of your company’s start date, enter the amount in the Opening Balance field. ? Click the Additional Info tab and complete the form. ? If you want to add additional fields to the form, click Define Fields to customize the form. ? Click OK or Next (if you want to enter another vendor). Adding Items In QuickBooks, an item is anything that your company buys, sells, or resells to run your business. Items are your products, services, and things such as shipping and handling charges, discounts, and sales tax. When you choose an item from the Item list, QuickBooks fills in a description of the line item and calculates its amount for you. QuickBooks provides 12 different types of items, described in the table on page 58. Some items, such as service or inventory part items, help you record the services and products your business sells. Other items, such as the subtotal or discount item, are used to perform calculations on the amounts in a sale. To add an item: ? Go to the Lists menu and click Item List. ? Click Item at the bottom of the list and then click New. ? Click the Type drop-down arrow and choose the type of item you want to create (see table on page 58). ? Enter an item name as you want it to appear on purchase and sales forms. ? Enter the description that you want to appear on sales forms when you use the payment item. ? In the Rate field, enter the amount you want to charge for the item or leave as zero, if the rate varies. ? In the Account field, choose the account that is associated with this item. (In most cases, you will assign the item to an income account.) ? In the Tax Code list, select the appropriate sales tax code or create a new one. If you do not see the Tax Code list, you must turn the tax preference on in the Sales Tax area under Edit | Preferences. ? Click OK or Next (if you want to enter another item). QuickBooks provides 12 different types of items to help you fill out sales and purchase forms quickly. Which Item Type Should I Choose? QuickBooks provides 12 different types of items to help you fill out sales and purchase forms quickly. Why item types are important Although you can use items as a quick means of entering data, items fulfill a much more important QuickBooks role: to handle the behind-the-scenes accounting. When you create an item, you link it to an account; when the item is used on a form, it posts an entry to that account and another entry to the appropriate accounts receivable, accounts payable, checking, fixed asset, or other account. While items are easy to set up, you should spend some time deciding how they can best work for you before you start setting them up and using them. Use your current list of services and products as a starting point. Consider how much detail you want on your invoices or statements and set up your items with that level of detail in mind. For example, if you are a seamstress who creates and sells home accessories, you can set up a single item and charge a flat rate for a certain size of couch pillow, or you can break that pillow down further into labor and materials. Furthermore, QuickBooks provides many useful reports that break information down by the goods or services you purchase and sell. That way, you can quickly find out: How much income your items bring in What you are spending to purchase items How well you estimate the cost of items How much time you spent on each type of job or item 6.5 Setting up sales tax Setting Up Your Business | Setting up Sales Tax Depending on where you do business, you might be required to collect sales tax for the products or services you sell. If you collect sales tax, you must pay it to a tax agency on a regular schedule. QuickBooks helps automate your sales tax tracking so you can keep accurate records about the sales tax you collect and pay. Important: You must follow the rules and regulations for collecting and paying sales tax in your tax district (city, county, state). Understanding how sales tax works QuickBooks uses sales tax codes to track the taxable or non-taxable status of both the items you sell (products and services) and your customers. If your tax agency requires you to report the reasons why particular sales are taxable or non-taxable, the sales tax codes that you assign to your items and customers enable you to run reports that provide this information for your sales tax return. QuickBooks uses sales tax items to calculate and add sales tax charges when you make a taxable sale. When you set up a sales tax item, you assign a sales tax rate to it and associate it with the tax agency to which you pay the sales tax. All of the sales tax items you set up are in your Item list. Once you’ve set up sales tax, QuickBooks automatically applies the appropriate sales tax rate to the sale of your taxable items. Before you start setting up sales tax To set up sales tax in QuickBooks, you need to know the following sales tax requirements for the locations where you sell your products and services: Sales tax rates for each tax district (a city, county, or state that has a sales tax) in which you sell. You may have multiple sales tax rates that you need to charge, for example, sales tax for both a county and a state. Tax agencies to which you pay the collected sales tax for each of those district taxes. Setting up sales tax Setting up sales tax is a multi-step process, divided into three main parts: Part 1: Sales tax payment schedule Part 2: Sales tax codes to track taxable status of items and customers Part 3: Sales tax items, rates, and tax agencies Part 1: Sales tax payment schedule In this procedure, you’ll turn on sales tax and then set up information about when you need to pay your tax agency. To set up your sales tax payment schedule: ? Go to the Edit menu and click Preferences. ? Click Sales Tax in the list on the left. ? Click the Company Preferences tab. ? For the question Do You Charge Sales Tax?, click Yes. ? Select when you owe sales tax to the tax agency, as specified by your tax agency. Select As of invoice date if your tax agency stipulates that you owe sales tax from the moment you write an invoice or make a sale. Select Upon receipt of payment if your tax agency stipulates that you owe sales tax when you receive the payment from a customer. Note: This preference overrides the accounting basis you’ve set for your company and for your report preferences (i.e., if your report preference is set to ―cash‖ but you select ―accrual‖ here, your sales tax reports will be accrual-based). ? Select how often you pay sales tax to the tax agency, as specified by your tax agency. If you don’t know which time period to choose, check your sales tax license. It should indicate the payment schedule that you need to use. 6.6 Setting up your Payroll As an employer, you have specific payroll responsibilities that are required by government agencies. These agencies can be federal, state, or local. Some of these responsibilities include, but are not limited to, withholding amounts from your employees’ compensation to cover income tax, social security, Medicare, and other payments. Choosing a payroll service To use QuickBooks to manage your payroll, you first need to subscribe to a QuickBooks payroll service. QuickBooks’ flexible options ensure that you get the payroll service that is right for you. QuickBooks also includes manual payroll features that do not require a subscription. Refer to the in-product Help for more information about using manual payroll in QuickBooks. Consult with a tax professional or accountant to address all of your business’ specific needs. You can learn about all of the QuickBooks payroll offerings, including manual payroll through the QuickBooks Payroll Web site. To learn about and sign up for a Payroll Service: ? Go to the Employees menu and click Payroll. ? Click Learn About Payroll Options. Or, if you are not sure which payroll service is right for you, contact one of our payroll experts at 1-866-820-6382 to learn more and help you choose. Note: If you choose to sign up for a payroll service, you will be prompted to complete the activation process for your service. After you complete your activation, you can set up payroll for your business as described in the next section. Setting up payroll QuickBooks Payroll includes an easy-to-use Payroll Setup wizard that guides you through setting up payroll for your business. Payroll Setup helps you set up your employees, set up compensation and benefit information, as well as enter any year-todate payroll data. You will also be assisted in setting up scheduled payroll groups and your payroll liability payment schedule to make managing your payroll easier. Setting up Employees To process paychecks and prepare tax documents for your employees, you need to enter specific information about each of your employees in QuickBooks. Note: If you are a QuickBooks Payroll subscriber, you will be prompted to add all of your employee information during payroll setup (described on page 69). Use the following procedure to edit employee information or to add additional employees at a later date. Refer to the Payroll Setup Checklist on page 71 for a list of employee information to gather. To set up an employee’s personal information: ? Click the Employee Center icon at the top of the QuickBooks window. ? Click New Employee. ? On the Personal tab, fill in the form. ? Click the Address and Contact tab, fill in the form, and then click OK. ? When prompted to set up the employee’s payroll information, click Leave As Is. To set up an employee’s payroll information: ? Click the Employee Center icon at the top of the QuickBooks window. ? Click the Employees tab and then double-click the employee’s name. ? From the Change tabs drop-down list, click Payroll and Compensation Info. ? Fill in the Payroll Info form. ? Click the Taxes button. ? Click the Federal tab and fill in the form, based on the employee’s W-4 information. ? Click the State tab and fill in the form. ? Click OK. Once you’ve set up your employees, refer to ―Paying Employees‖ to learn about paying them. QUICKBOOKS OPERATING FEATURES252984-56712 Learning Objectives By the end of this chapter the learner shall be able to; Create an Estimate in QuickBooks Create an Invoice Enter sales receipts and receive a payment in QuickBooks software and receive money from a customer by making a deposit Pay a bill and write checks Prepare different reports such as trial balance, Trading profit and loss account and balance sheet 7.1 Creating an Estimate You can use the estimate form to prepare estimates, bids, quotes, or proposals for your customers. You can change the title ―Estimate‖ to anything that suits your business. Filling in the estimate is similar to creating an invoice. And when it’s time to bill your customer, you can create the invoice directly from the estimate by clicking Create Invoice on the estimate’s toolbar. QuickBooks then creates the invoice, with all the information from the estimate filled in. Later, you can create reports that compare your estimated costs and revenue against your actual costs and revenue to see how accurate your estimates are. To create an estimate: ? If necessary, turn on Estimates (described below), if you didn’t do this during the EasyStep Interview. ? Go to the Customers menu and click Create Estimates. ? Enter the name of the customer or job. ? Select an estimate template from the Template dropdown list. ? Fill in the estimate form. ? Click Print. ? Save the estimate. To turn on the estimates feature: ? Go to the Edit menu and click Preferences. ? Click Jobs & Estimates in the list on the left and then click the Company Preferences tab. ? Click Yes to the question, ―Do You Create Estimates?‖ ? To have QuickBooks warn you when you try to record an estimate with the same number as the existing estimate, select the Warn about duplicate estimates numbers checkbox. ? If you do progress invoicing: Make sure Yes is selected in response to the question, ―Do You Do Progress Invoicing?‖ Specify whether you want line items that have zero amounts to print on your progress invoice ? Click OK. 7.2 Creating an Invoice When your customers don’t pay you in full at the time you provide your service or product, or when they pay in advance, you need to track how much they owe you. You can use an invoice to help you keep track of what your customers owe you (or your ―accounts receivable‖). Invoices list all the details about the sale, including the services you’re providing or the products you’re selling (your ―items‖). Invoices also show the quantity and price or rate of each item. If you need to make automatic adjustments to prices (for example, discounts or markups), invoices will work for you. Note: If your customers pay in full at the time of purchase, do not create an invoice. Instead, create a sales receipt, described on page 79. To create an invoice: ? Go to the Customers menu and click Create Invoices. ? In the Customer:Job drop-down list, enter a name or click the name of the customer or job. ? Click the Template drop-down arrow and then click the invoice template you want to use. ? Click the Terms drop-down arrow and then click the sales terms that apply to this customer. ? In the lower part of the form, enter each of the items (including the proper quantity) that the customer has purchased. ? Click Print on the toolbar to print the invoice now. Optionally, you can select the To be printed checkbox to print the form later or the To be e-mailed checkbox to e-mail the form later. ? Save the invoice. 7.3 Entering sales receipts When your customers pay in full at the time they receive your service or product, you don’t need to track how much they owe you. However, you might want to record the sale, calculate its sales tax, or print a receipt for the sale. In these cases, you can create a sales receipt. Examples of businesses that commonly use sales receipts include beauty salons, pet groomers, dry cleaners, and restaurants. Note: If you need to track how much a customer owes you or you do not receive full payment at the time of the transaction, do not use a sales receipt. To enter a sales receipt: ? Go to the Customers menu and click Enter Sales Receipts. ? Fill in the top part of the form, including the Customer:Job, Date, and Payment Method. ? Click the Template drop-down arrow and then click the sales receipt template you want to use. ? In the bottom part of the form, select or enter the items purchased. ? Save the transaction. 7.4 Receiving a Payment When you receive money from a customer, you must receive the payment in QuickBooks so QuickBooks can record the transaction and mark the invoice as being paid. When you receive a payment, the accounts receivable records are updated, and the payment is ready to be deposited into an account. To receive a payment: ? Go to the Customers menu and click Receive Payments. ? Fill in the top portion of the form, including the customer’s name, the payment amount, payment method, and the date on which the payment was received. ? Check the column to the left of the invoice to which you want to apply the payment. You might be asked to decide how to apply the payment for one of the following scenarios: Overpayment can become a credit or refund Underpayment can be left as is or written off Customer has unused credit to be applied Customer has available discounts ? Choose the appropriate selection and you should see your choices reflected in total amounts for selected invoices. If the customer has a discount or available credits, you can choose how to apply them. ? Save the payment. 7.5 Making a Deposit When you receive a payment from a customer, you can either deposit the payment into a bank account immediately, or you can wait until a later time to make the deposit. To make a deposit: ? Go to the Banking menu and click Make Deposits. ? In the Payments to Deposit window, select the payments that you want to deposit and click OK. ? In the Make Deposits window, click the Deposit To drop-down arrow and then click the account to which you want to deposit the funds. ? Verify the date and the list of payments to deposit, making updates as necessary. ? If you want to receive cash back from this deposit, fill in the Cash Back fields at the bottom of the form. ? If you want to print a deposit slip or deposit summary, click Print. ? Save the deposit. Note: Just because you’ve recorded the deposit in QuickBooks doesn’t mean that you’ve actually made the deposit and that the money is available. You still need to physically deposit the money at the bank or send an online transfer. 7.6 Paying Bills As you purchase equipment, supplies, products, or services to run your business, you will also receive bills that need to be paid. Entering these bills in QuickBooks enables you to not only track information about your purchases, but also to pay these bills. QuickBooks remembers all of your unpaid bills, enabling you to easily choose the bills you want to pay. QuickBooks then writes and saves the checks or credit card charges or sends the online banking payment instructions, depending on the payment method you choose. Note: Before paying a bill, be sure you read the section ―Writing checks versus paying bills‖ on page 41 to make sure you are using the correct payment method. To enter a bill: ? Go to the Vendors menu and click Enter Bills. ? In the Vendor field, choose or enter a new vendor. Note: If an open purchase order exists for this vendor, you are prompted to receive against it. Click Yes to receive against one or more purchase orders; then, in the Open Purchase Orders window, click each purchase order that contains items you’ve received and are being billed for. ? Specify the Payment Method, Payment Account, and Payment Date. ? In the Amount Due field, enter the amount of the bill. ? Fill in the Date, Ref. No., Terms, and Memo fields as necessary. ? For expenses (money you spend to run your business, such as utilities), assign the bill to one or more expense accounts on the Expenses tab. For items (products or services your business buys), edit items that were entered from your purchase order or enter new items on the Items tab. ? Click Save & Close or Save & New to enter the transaction. To pay a bill: ? Go to the Vendors menu and click Pay Bills. ? All outstanding bills are displayed. To limit the number of bills displayed, click Due on or before and then click the due date for the bills you want to display. ? Click Pay Selected Bills to complete the transaction. ? Click Pay Selected Bills to complete the transaction. 7.7 Writing Checks You can write a check for any kind of expense that you track with QuickBooks expense accounts and for noninventory part, service, and other charge items. If you are using inventory or purchase orders (Premier only), you can write checks for inventory part items too. Note: Before writing a check, be sure you read the section ―Writing checks versus paying bills‖ on page 41 to make sure you are using the correct payment method. To write a check: ? Go to the Banking menu and click Write Checks. ? Click the Bank Account drop-down arrow and then click the account from which you want to write the check. ? Fill in the onscreen check as you would a paper check. ? Itemize your expenses (shipping charges, taxes, or other expenses not associated with any one item) on the Expenses tab. ? If you are purchasing items for your inventory, enter the items on the Items tab. ? Save the transaction. To find and print a single check: ? Load the blank check form into the printer. ? Go to the Banking menu and click Write Checks. ? Click the Find button and search for the check you want to print. ? Double-click to view the check you want to print. ? Click Print. ? In the Print Checks window, choose the options you want and click Print. Note: To learn how to print multiple checks at the same time, refer to the in-product Help. 7.8 Issuing Credits or Refunds Use a credit memo to record a credit when a customer returns items and you’ve already recorded an invoice, customer payment, or sales receipt. You can also use a credit memo for an overpayment. To enter a credit memo or record a return: ? Go to the Customers menu and click Create Credit Memos/Refunds. ? In the Customer:Job field, click the customer and job for which you are creating the credit memo or refund check. Note: If you have created more than one job for the customer, be sure to assign the credit memo to the correct job. You can apply the credit memo only to the same job for which it was created. ? Click the Template drop-down arrow and then click a template. 7 0 ? Enter the items being returned in the line item area. ? Describe the reason for the credit and enter the quality and rate, if applicable. ? (Optional) Enter a memo for this transaction. Note: The memo does not print on the credit memo, but it does appear in the Accounts Receivable register and in the customer register. ? Indicate whether you want to print or e-mail the credit memo to the customer. (You can choose to do both.) ? Save the credit memo. ? In the Available Credit window, choose how to use the credit. You can: Retain as an available credit Give a refund Apply it to an invoice Note: QuickBooks enters a negative amount in your Accounts Receivable register for the credit memo. 7.9 Paying Employees Paying employees is a big responsibility. You have to keep track of hours, salaries and wages, Social Security numbers and dependents, tax rates and forms, vacation and sick time, bonuses and advances, as well as company payments to government and private pension plans. QuickBooks provides several features and services to help you manage your own payroll quickly and easily. Note: For information about your payroll options in QuickBooks, go to the Employees menu, click Payroll Service Options, and then click Learn About Payroll Options. To print paychecks: ? Go to the Employees menu, click Pay Employees, and then specify if you want to pay employees using Unscheduled Payroll (generally used to pay bonuses and off-cycle checks) or set up Payroll Schedules. ? Update the Pay Period Ends date and the Check Date values, as needed. ? Click the Bank Account drop-down arrow to choose the account that QuickBooks uses to record this transaction. ? Select the employees you want to pay by clicking in the column to the left of the employee’s name. ? Review the paycheck information in the Enter Payroll information window. ? To preview or modify a paycheck, click the employee’s name to open the Preview Paycheck window. Make any necessary changes and click Done. ? Click Continue. ? Review and verify the paycheck information in the Review and Create Paychecks window. ? In the Paycheck Options section, click whether the paychecks should be printed or handwritten. ? Click Create Paychecks. ? In the Confirmation and Next Steps window that appears, click Print Paychecks. Click Send Payroll to Intuit if you’re sending your payroll to Intuit for processing. 7.10 Using Reports One of QuickBooks’ most robust features is its ability to generate data-rich reports about your business. Everything you enter in QuickBooks can be found and generated into a report. QuickBooks comes with dozens of prepared reports that you can run. You can use the Report Center to learn about QuickBooks reports and locate the ones that contain the information you need. Once you’ve found a report, you can change its date range, customize the way it looks, print a copy of it, export it to Microsoft Excel, or display it on your screen. To find and display the right report: ? Click the Report Center icon at the top of the QuickBooks window. ? Click a report category from the list on the left. Reports for the selected category are displayed on the right. ? From the report list, you can view a thumbnail picture of the report by moving your mouse over the thumbnail icon . To learn more about a specific report, click the More... link to learn about the data and specific ways to customize the report. ? When you find the report you need, click its name to view the report. How to Use Reports to Find the Information You Want The QuickBooks Report Center describes all the available reports. Here are 10 common questions that people ask and the QuickBooks report you can use to find the answer. 8890-9144000 ................
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