McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. ENTERPRISE INFORMATION SYSTEMS A PATTERN BASED APPROACH Chapter.

8-2 Chapter Learning Objectives 1.Identify activities and documents common to sales/collection business processes for various enterprises 2.Recognize similarities and differences between different types of revenue-generating enterprises 3.Identify the components of the REA ontology in the sales/collection business process 4.Explain how the sales/collection business process fits into an enterprise’s value system 5.Explain how the sales/collection business process fits into an enterprise’s value chain 6.Create a REA business process level model for an enterprise’s sales/collection business process 7.Create queries to meet common information needs in the sales/collection process

8-3 Sales/Collection Process in an Enterprise Value System

8-4 Sales/Collection Business Process in Enterprise Value Chains

8-5 REA Sales/Collection Business Process Level Pattern

8-6 Sales/Collection Process Events Instigation Events in the Revenue Cycle –May be internally instigated (marketing events such as sales calls, advertising campaigns, or promotions) –May be externally instigated (customer inquiries) –Internal agents involved in revenue cycle instigation events usually are sales/marketing personnel or customer service representatives –External agents involved in revenue cycle instigation events usually are customers –Typically there is no need to specifically identify a good or service for purposes of instigation events; information about the type of good or service promoted is usually sufficient

8-7 Customer Inquiry Event An instigation event that is externally initiated; typically involves a customer contacting the enterprise, either via telephone, e-mail, or in person, to inquire as to the pricing and availability of products or services Data is not typically captured for this event; the customer’s questions are answered and if the customer does not immediately place an order, the customer may be added to a sales representative’s list of future sales calls. If data were to be captured, it would be similar to the data captured for sales calls

8-8 Sales Call Event An instigation event that is internally initiated; typically involves a sales representative calling on a customer, either via telephone or in person, to describe the features of one or more products or services Is usually symbolized by a sales call report document or data entry screen that summarizes information about this event (e.g., which sales representative(s) and customer(s) participated, date, start time, end time, location, what products and/or services were presented to the customer and what the customer reactions were to those products/services, etc.)

8-9 Sales Call Report

8-10 Relational tables Encompassing Sales Call Event

8-11 Sales/Collection Process Events Mutual Commitment Events in the Revenue Cycle –Involve the enterprise and an external business partner agreeing to exchange resources at a defined future time –Don’t always happen at a discrete point in time; often involves a series of activities –Internal agents are usually sales or customer service representatives and/or order entry clerks who assist the customer and collect the order data –External agents usually are customers –Typically there is no need to specifically identify a good or service for purposes of mutual commitment events; information about the type of good or service promoted is usually sufficient –Ideally enterprises would like to be able to trace mutual commitment events to the instigation events that triggered them

8-12 Sale Order Event A mutual commitment event whereby the enterprise agrees to deliver goods to a customer and that customer agrees to pay an ascertained price for those goods Is usually symbolized by a sale order document or data entry screen that summarizes information about this event (e.g., order date, promised delivery date, payment terms, dollar amount, which sales representative(s) and customer(s) participated, what products the customer ordered, etc.)

8-13 Rental Contract Event A mutual commitment event whereby the enterprise agrees to transfer possession of a product to a customer for a defined time period and bestows on that customer the right to use the product for a prescribed purpose and in exchange the customer agrees to pay an ascertained price Is usually symbolized by a rental contract document that summarizes information about this agreement (e.g. contract date, dollar amount, product(s) to be rented, time period for which each product is to be in customer’s possession, payment terms, which sales representative(s) and customer(s) participated, etc.)

8-14 Service Contract Event A mutual commitment event whereby the enterprise agrees to perform one or more services for a customer during a defined time period for an agreed upon price and in exchange the customer agrees to pay an ascertained price Is usually symbolized by a service contract document that summarizes information about this agreement (e.g. contract date, dollar amount, service(s) to be provided by enterprise, time period during which service(s) will be performed, payment terms, which sales representative(s) and customer(s) participated, which employees or types of employees will perform the services, etc.)

8-15 Sale Order Document

8-16 Service Agreement Document

8-17 Relational Tables Encompassing Sales Order Event

8-18 Sales/Collection Process Events Economic Decrement Events in the Revenue Cycle –Represent the revenue generating activities; the giving up of one or more resources in order to get some other resource (usually cash) –Do not always happen at discrete points in time; may involve a series of workflow activities (e.g. picking, packing, shipping, and so on) –Resources vary for different types of businesses Inventory (Inventory type may substitute for Inventory), Labor (Service Type may substitute for Labor), Temporary use of asset (as in a rental) –Internal Agents are typically salespeople, shipping clerks, delivery clerks, and service engagement personnel –External Agents are typically customers or clients

8-19 Sale Event An economic decrement event in which title (ownership) of one or more products is transferred from the enterprise to a customer. The transfer may take place in person (e.g. a sale of a t-shirt at a campus bookstore) or in transit (e.g. a shipment of a video game from an enterprise with a web- based storefront) Is usually symbolized by a bill of sale, sale invoice, or similar document (or data entry screen) that summarizes information about the title transfer (e.g. date, dollar amount, product(s) for which title transferred, payment terms, which sales representative(s) and customer(s) participated, etc.) Sales that occur via transit are usually also symbolized by a packing list (which lists quantities of specific products shipped) and a bill of lading (which indicates the number, dimensions, and weight of packages in which products were shipped)

8-20 Rental Event An economic decrement event in which possession of one or more products is transferred from an enterprise to a customer for an agreed upon length of time for an agreed upon purpose and price Usually occurs over an extended period of time, rather than occurring at a single point in time Is usually symbolized by documents or data entry screens that summarize information about the transfer of possession of products to the customer and then the return of products to the enterprise (e.g. dates, times, which products, rental agent, and customers were involved, etc.)

8-21 Service Engagement Event An economic decrement event in which one or more agents of the enterprise provide one or more types of service to a customer May occur over an extended period of time, or may be performed at a point in time Is usually symbolized by service invoice or similar documents or data entry screens that indicate the services have been performed and summarize information about the performance (e.g. date(s), time(s), types of service performed, which employee performed the service(s), for which customer, possibly some notes made by the employee about the service, etc.)

8-22 Sale Invoice

8-23 Picking List

8-24 Packing List

8-25 Bill of Lading

8-26 Relational Tables Encompassing Sale Event

8-27 Sales/Collection Process Events Economic Increment Events in the Revenue Cycle –Almost always is a Cash Receipt event An economic increment event in which an external agent transfers ownership of cash (or a cash equivalent) to the enterprise Is usually symbolized by a remittance advice document or data entry screen that summarizes information about the event (e.g. date, dollar amount, customer from whom cash was received, employee who processed the cash receipt, sale or other revenue generating activity to which cash receipt applied, etc.) Resource is typically cash (a type-level resource – usually a listing of cash accounts owned by the enterprise) Internal agents are usually cashiers, accounts receivable clerks, or other financing personnel External agents are usually customers or clients

8-28 Customer Statement with Remittance Advice

8-29 Relational Tables Encompassing Cash Receipt Event

8-30 Sales/Collection Process Events Economic Decrement Reversal Events –Events in which previous economic decrement events are reversed or negated –Although similar in mechanics, such events are inherently different from economic increment events Getting something back that you were happy you had given up (and for which you now have to give back the thing you were originally happy to get) is not the same as getting something you wanted to get in exchange for giving up something you were willing to give up –Resources, Internal Agents, and External Agents are the same as those for economic decrement events

8-31 Sale Return Event An economic event in which title (ownership) for products that were previously transferred from seller to buyer is transferred back from buyer to seller Although a resource (or resource type) is increased as a result, the nature of sale returns is different than other economic increment events, I.e., it isn’t generally viewed as a desirable result. The substance of the event is such that the original economic decrement is negated. Thus, we label such events as economic decrement-reversal events. Is usually symbolized by sales return authorization, receiving report and credit memo documents or data entry screens that summarize information about the event (e.g. date, what quantities of which products were received from customer; dollar amount, which customer is involved, which employee processed return, etc.)

8-32 Sale Return Authorization

8-33 Receiving Report

8-34 Credit Memorandum

8-35 Relational Tables Encompassing Sale Return Event

8-36 Sales/Collection Process Relationships Fulfillment relationships –Between Marketing, Sales Call, or Customer Inquiry and Sale Order events –Between Sale Order and Sale (or Rental or Service engagement) events Duality relationships –Between Sale (or Rental or Service engagement) and Cash Receipt (or Receipt of Bartered Goods/Services) events Reversal relationships –Between Sale and Sale Return events Participation relationships –Between each event and each internal and external agent

8-37 Sales/Collection Process Relationships Proposition relationships –Between Marketing, Sales Call, or Customer Inquiry event and Inventory (or Inventory Type or Service Type) Reservation relationships –Between Sale Order, Rental Contract, or Service Contract and Inventory (or Inventory Type or Service Type) –Also between Sale Order, Rental Contract, or Service Contract and Cash Stock flow relationships –Between Sale (or Rental or Service Engagement) and Inventory (or Inventory Type or Service Type) –Between Sale Return and Inventory (or Inventory Type) –Between Cash and Cash Receipt

8-38 Resource Query Types Detailed status information at one or more points in time for each resource instance Detailed status information at one or more points in time for only those resource instances meeting specified criteria Summarized status information at one or more points in time for all resource instances Summarized status information at one or more points in time for only those resource instances meeting specified criteria

8-39 Revenue Cycle Resource Queries A list of each inventory item or item type offered for sale by an enterprise A list of all inventory items or item types that possess certain characteristics –(e.g. all books, real estate listings with lake frontage, toys with selling prices within a certain range, video games in GameBoy Advance format, preventive dental care services, etc.) Quantity on hand of an inventory item type as of a specified date Total cost value of inventory on hand as of a specified date A list of all cash accounts owned by an enterprise as of a specified date Balance in a specific cash account as of a specified date Total balance in all cash accounts as of a specified date

8-40 Example Resource Type Query SELECT Description, UnitOfMeasure, ListPrice FROM InventoryType WHERE ListPrice < 70;

8-41 Example Resource Type Query SELECT * FROM Cash WHERE DateAccountEstablished < April 20, 2010;

8-42 Event Query Types Detailed information about each event instance –e.g., what happened, when and where did it happen, etc. Detailed information about each event instance that meets specified criteria –e.g. events of a specified type that occurred during a specified time period or that occurred at a specified location Summarized information for all instances of an event type for a specified time period –e.g. total of the event instances during a specified time period Summarized information for only those instances of an event type for a specified time period that meet specified criteria –e.g. average dollar value of the event instances for a specified location during a specified time period

8-43 Revenue Cycle Event Queries Location of a sales call Total number of sales calls, sale orders, sales, etc., that occurred at a specified location or during a specified time period Total dollar amount for a specific sale order, sale, cash receipt, or sale return Total or average dollar amount of all sale orders, sales, cash receipts, or sale returns for one or more specified time periods Total or average dollar amount of sale orders, sales, cash receipts, or sale returns in a specific location for one or more specified time periods Sales tax applicable to a specified sale event Shipper’s tracking number for a shipment sale event Date a sale event occurred Length of a sales call (end time minus start time)

8-44 Event Tables

8-45 Which table(s) do we need? Query to identify date and location of Sales Call #44 Which relational algebra operators apply? What is SQL statement? Project, Select SELECT SalesCallID, Date, Location FROM SalesCall WHERE SalesCallID=44; What is Access QBE? What is the result?

8-46 Sales for a specified time period (e.g. for an income statement) Which table(s) do we need? Which relational algebra operators apply? What is SQL statement? Project, Select SELECT Sum(DollarTotal) FROM Sale WHERE Date BETWEEN 5/1/2010 AND 5/7/2010; What is Access QBE? What is the result?

8-47 Agent Query Types Detailed status information at one or more points in time for each agent instance Detailed status information at one or more points in time for only those agent instances meeting specified criteria Summarized status information at one or more points in time for all agent instances Summarized status information at one or more points in time for only those agent instances meeting specified criteria

8-48 Revenue Cycle Agent Queries A list of all salespeople, cashiers, inventory clerks, or credit managers for an enterprise A list of all employees that possess certain characteristics –e.g. all waiters and waitresses who are at least 21 years old, all staff auditors who have passed the CPA exam, all salespeople whose pay is commission-based, etc.

8-49 Example Agent Tables

8-50 Identify Customers with Credit Rating of “A” or “A+” Which table(s) do we need? Which relational algebra operators apply? What is SQL statement? Select SELECT * FROM Customer WHERE CreditRating=A OR CreditRating=A+; What is Access QBE? What is the result?

8-51 Duality Relationship Query Types Identification as to whether a specified exchange is completed Identification of completed exchanges for a specified time period Identification of incomplete exchanges for a specified time period Calculation of the amount of claims, e.g. prepaid expenses, payables, unearned revenues, or receivables, either in total or for a specified exchange event Calculation of the total or average length of the timing difference(s) between the events involved in one or more exchanges

8-52 Revenue Cycle Duality Queries Calculation of the outstanding receivable balance for a sale (or service engagement) invoice Calculation of total accounts receivable at a point in time Calculation of prepaid revenue at a point in time Aging of accounts receivable Calculation of the average number of days it takes to collect receivables

8-53 Example Duality & Reversal Relationship Tables

8-54 Accounts Receivable Query Steps Conceptually –Dollar value of sales or service engagements for which cash receipt has not yet occurred in full, adjusted for any sale returns and sale discounts. Practically –Total sales/service engagements through balance sheet date minus total cash receipts through balance sheet date that applied to sales/service engagements. Also subtract sales returns and discounts through balance sheet date. –MUST include ONLY ending date constraint (balance sheet item reflects cumulative data from beginning of company through balance sheet date). –Use sale/service engagement date to determine which revenues to include. –Use cash receipt date and duality relationship to determine which cash receipts to include. Be sure to aggregate cash receipts that apply to same sale BEFORE subtracting from sale amount –Likely need for outer join and Nz function in Access (for sales with no matching cash receipts –Note: Sales minus Cash receipts from Customers not acceptable (because you might get non-sale related CR from customers)

8-55 Accounts Receivable Step 1: Total Sales through Balance Sheet Date “hard-wired” date date as parameter

8-56 Accounts Receivable Step 2: Total Cash Receipts for Sales through Balance Sheet Date 2a: identify them 2b: sum them

8-57 Accounts Receivable Step 3: Total Sale Returns through Balance Sheet Date Identify and sum them

8-58 Accounts Receivable Step 4: Calculate A/R as sales minus applicable cash receipts and sale returns

8-59 Accounts Receivable Result without Nz As of May 31, 2010 As of May 15, 2010

8-60 Adjusted Accounts Receivable Step 4 (using Nz to control null values)

8-61 Stockflow Relationship Query Types What resources or resource types were increased or decreased by an economic event? What quantity of a resource or resource type was increased or decreased by an economic event? What dollar value of a resource or resource type was increased or decreased by an economic event? When did an event increase or decrease a specific resource or resource type? Where did an event increase or decrease a specific resource or resource type?

8-62 Revenue Cycle Stockflow Query Types Which inventory types were decreased by a specific sale event? What quantity of each inventory type was decreased by a specific sale event? Which inventory types were increased by a sale return event? What quantity of each inventory type was increased by a specific sale return event? What selling price was charged for an inventory type on a specific sale event? What selling price was granted as credit for an inventory type on a specific sale return event? What was the total dollar value of sales for a specified time period? –(Note: if total sale amount is stored in the sale event table, then it is not necessary to use the stockflow relationship to meet this information need) What is the average dollar value of sales of a specified inventory type for a specified time period?

8-63 Tables to use Query to find dollar value of sales of a specified inventory type for a specified time period

8-64 Query to find dollar value of sales of a specified inventory type for a specified time period

8-67 Query to identify highest and lowest selling inventory during a specific time period

8-70 Fulfillment Relationship Query Types Identification of unfulfilled commitments or instigation events Identification of fulfilled commitments or instigation events Identification of commitment events that were not preceded by instigation events, or identification of economic events that were not preceded by commitment events Calculation of length of time between instigation and commitment events or between commitment and economic events Identification of causes of commitments and/or of economic events Identification of results of instigations and/or of commitment events

8-71 Revenue Cycle Fulfillment Queries Identification of unfilled sale orders Identification of successful sales calls –i.e., those sales calls that resulted in orders Calculation of number of average days the enterprise takes to fill sale orders for a given time period

8-72 Query to calculate number of days to fill selected sales orders

8-75 Proposition Relationship Query Types What resources or resource types does the instigation event propose to increase or decrease? What quantity of a resource or resource type is the proposed increase or decrease for an instigation event? When did an instigation event propose to increase or decrease a specific resource or resource type?

8-76 Revenue Cycle Proposition Queries Which inventory types were presented as part of a sales call event? What selling price was proposed for an inventory type in a specific sales call event? What was the reaction to each inventory type presented in a specific sales call event? Have any inventory types never been presented in any sales call event? How many different types of inventory were presented in a specific sales call event?

8-77 Query to identify inventory items with no positive customer reactions

8-80 Reservation Relationship Query Types What resources or resource types is a commitment event agreeing to increase or decrease? What quantity of a resource or resource type is a commitment event agreeing to increase or decrease? What dollar value of a resource or resource type is a commitment event agreeing to increase or decrease? When did an event commit to increase or decrease a specific resource or resource type? Where did an event commit to increase or decrease a specific resource or resource type?

8-81 Revenue Cycle Reservation Queries Which inventory types does a specific commitment event agree to decrease? What quantity of each inventory type does a specific commitment event agree to decrease? What selling price was quoted for each inventory type in a specific commitment event? What was the total dollar value of sale orders for a specified time period? (Note: if total dollar amount is stored in the sale order event table, then it is not necessary to use the reservation relationship to meet this information need) What is the average dollar value of sale orders of a specified inventory type for a specified time period?

8-82 Participation Relationship Query Types Which agent(s) participated in a specified event? How many events of a specified type has a specified agent participated? What is the total dollar value of events of a specified type in which a specified agent has participated for a specified time period? When did a specified event in which a specified agent participated occur? Where did a specified event in which a specified agent participated occur?

8-83 Revenue Cycle Participation Queries To which customer was a specific sale made? By which salesperson was a specific sale order accepted? How many sales calls did a specified salesperson make during a specified time period? What is the total (or average) dollar amount of sales made by each salesperson during a specified time period? When was a specified shipment sent to a specified customer? Where did a specified sales call to a specified customer take place?

8-84 Query for number of sales calls made by each salesperson during a time period

8-85 Query for number of sales calls made by each salesperson during a time period

8-86 Multiple-Relationship Revenue Cycle Queries Which sale orders have been partially filled? –requires stockflow, reservation, and fulfillment-sale-order- sale relationships What is the total dollar value of accounts receivable for a specified customer at a point in time? –requires duality, participation-customer-sale, and participation-customer-cash receipt relationships What inventory types have been presented to a specified customer in sales calls during a specified time period? –requires proposition and participation-customer-sales-call relationships

8-87 Which salesperson presented a specified inventory type to a specified customer? –requires proposition, participation-customer-sales call, and participation-salesperson-sales-call relationships What is the total dollar amount of sales of a specified inventory type that have been made to customers in a specified region? –requires stockflow and participation-customer-sale relationships In what region have sales calls involving a specified inventory type been the most successful? –requires proposition, fulfillment-sales-call-sale-order, and reservation relationships More Multiple-Relationship Revenue Cycle Queries

8-88 Query to identify partially filled sale orders Query requires use of the fulfillment, reservation, and stockflow relationships

8-89 Query to identify partially filled sale orders

8-96 Summary We discussed the sales/collection (revenue) process and how it fits in at the value system and value chain levels We discussed the extended REA pattern at the business process level We examined documents typically used to represent events and discussed related resources and agents We examined examples of relational database tables for the revenue cycle and discussed data input into those tables We systematically discussed types of queries for the sales/collection process to support decision-makers in various functional areas We provided selected examples of queries of various types

McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. ENTERPRISE INFORMATION SYSTEMS A PATTERN BASED APPROACH Chapter.

Similar presentations

Presentation on theme: "McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. ENTERPRISE INFORMATION SYSTEMS A PATTERN BASED APPROACH Chapter."— Presentation transcript:

Similar presentations

About project

Feedback

Log in

Auth with social network:

McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. ENTERPRISE INFORMATION SYSTEMS A PATTERN BASED APPROACH Chapter.

Similar presentations

Presentation on theme: "McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. ENTERPRISE INFORMATION SYSTEMS A PATTERN BASED APPROACH Chapter."— Presentation transcript:

Similar presentations

About project

Feedback