Unit 9 Systems Analysis and Design

Unit 9 Systems Analysis and Design


CHAPTER I: INTRODUCTION

1.1 Historical Background
Since its establishment in 1973, the Belen’s Furnishing has been trusted and pioneer in soft furnishing and trusted by very well-known hotels and companies nationwide. Belen’s Furnishing is a contractor, fabricator, and wholesale/retail trader of soft furnishing directed principally to institutional accounts as hotels, banks, industrial offices, restaurants and residential buildings. Their services and products are acknowledge by companies and institutions like Diamond Hotel, The Mandarin Hotel, Maranaw Hotel and Resorts Corp., SM Land, The Discovery Suites, The Peninsula Hotel and many more. Belen’s Furnishing is a single proprietorship owned by Belen G. Villaluz. Their main office is located at 15 Shenandoah St. South Green Park Village, Brgy. Merville, Parañaque City, Metro Manila. Its factory, where its main facility is located at Indang, Cavite with a floor size of 650 sq. meters with a 55 KVA Generator. Product lines:

1. Drapery and Curtain materials: Imported and local fabrics, Vertical Blinds and Horizontal Blinds, Roller Shades. 2. Curtain Tracks: Roller type, Baton or Cord, or Motor-operated with accessories (with push button or remote control) 3. Roman Shade Mechanism: Manually or Motor-operated (push button or remote control) 4. Bedroom Linen: Quitted bedcovers/bedspreads; Comforters, Mattress Pads, Sheets (Flat and Fitted); Pillows and Pillow cases. 5. Table Linen: Tablecloths – Plain/embroidered and skirts; Napkins – Plain/embroidered; Mats and runners; Table silencers.

List of Suppliers:
1. Rollshade Enterprises – Unit B2 Palanca St. San Antonio Bldg. BF Homes Phase 1, Parañaque City 2. Larry’s Curtain and Upholstery Supply Inc. – South Super Highway, Makati City. 3. New Highton Fabrics – Ledesma Bldg. Pas A -106 #853 Talora St. Binondo, Manila. 4. Pan Atlantic International Enterprises – Divisoria

5. New Master Store – 795 Juan Luna St., Binondo, Manila
For almost 33 years of quality of service and products on drapery and soft furnishings, they stand strong among other competitors and always say to their clients and customers, “We always give you the BEST”.

1.2 Organizational Chart
1.2.1Company as whole

1.2.2Division Understudy

1.3 Statement of the Problem

Problem 1: Lack of actual summary reports of inventory for the top management

Documents Involved: (See Indexes for samples)
* Quarterly Inventory Report – It is an unconsolidated report of the inventory generated by the company every quarter of the year submitted to the management. * Transmittal slip (Company/Client) – form used for transferring materials from the client to the company (Transmittal slip from the client) or transferring materials from the main office to the factory (Transmittal slip from the company). * Sales Invoice (Supplier) – given by the supplier to the company as proof of purchase of materials.

Scenario:
The record keeper submits unconsolidated report from the warehouse to the factory supervisor then the factory supervisor submits it to the executive assistant. These reports are submitted quarterly to give an update about the inventory level and how much does the factory consumes every 3 months. The supplies are check by the record keeper and factory personnel every month and the report is done every end of the quarter. However, there is no summarization of these reports. The summarization of reports from the factory itself is very important to the company however it is only an unconsolidated report which is generated from their existing system flow (not a summarization of the inventory). The summarization of inventory reports can be used by the management for the analysis cost, benefits, and decision – making that will be profitable for the company. The existing system lacks facts/ information that are distinguished to be very important and necessary in ensuring the company’s growth and maintaining the quality of the products and services to its clients. The present report submitted by the record keeper to the top management does not contain the data necessary in making a profitable decision. * List of items, total worth of goods on hand and wasted

* Reports about product lost, wasted defective, and to be disposed * Summary report of purchased items from the supplier
* Information for the top management
Cause:
* Lack of information needed to generate the summary report. Unconsolidated report is only produced every quarter of the year. * Inventory checking and record keeping being practiced do not include the detailed facts and information needed in the generating Quarterly Purchasing and Inventory Report. Impact:

* Poor and delay in decision making of the management in some critical scenarios due to the incompleteness of the report. * Reports currently generated are not reliable for the top management (Executive Assistant and General Manager) since the information of the report is not enough. * Loss of profit due to lack of summary report.

Quantification:

Total profit loss due to lack of summary report:
Total profit loss annually due to unmonitored materials/ items = Php 200,000.00
Total profit loss annually due to unmonitored product loss = Php 13,500.00 (average product price) Assuming that 5-10 product loss, Php 67,500.00 – Php 135,000.00
Total profit loss due to unreliable inventory system.
Php 200,000.00 + 67,500.00= Php 267,500.00
Php 200,000.00 + 135,000.00= Php 335,000.00
Total profit loss (range) annually due to unreliable inventory system: Php. 267, 500.00 – Php. 335,000.00

Problem 2: Insufficient information for inventory and purchasing documents processed by the company.

Documents involved: (See Indexes for samples)
* Record Book/Notebook of Inventory – record basis of the company’s inventory report * Sales Invoice (Supplier) – proof of purchase from the supplier. * Purchased order (Client) – order (materials and job order) from the client.

Scenario:
The company acquires the materials/ items by purchasing from different suppliers with different products based on the purchased order of the client. It is in contractual basis through the purchasing and inventory discussion.

The executive assistant is the one that approves documentation process of information and proper usage of different resources. However, there are some information which is not documented for the inventory and purchasing data.

Lack of information on:
* Product checking / verification (if there are defective materials for the supplier). * Item/ material replacement, wasted and cost.
* Item Description (Item Code).

Cause:
* Unrecorded and undocumented papers in inventory and purchasing process.

Impact:
* Unmonitored loss of income of the company
* No monitoring on the life span of the items.
* Rely in physical count for reordering of materials

Quantification:
Unmonitored fabric from the supplier:
Average cost of the fabric from the supplier: Php 550.00
Average quantity of order of fabric: 40 yards
Lost in income due to unmonitored defective stock: Php 550.00 X 40 yards = Php 22,000.00 Average incidence per year= 2
Lost in income annually due to unmonitored defective stock material = Php 44,000.00

Problem 3: Searching of purchasing and inventory records is time consuming.

Documents involved: (See Indexes for Sample)

* Purchase Order (Client) – order (materials and job order) from the client. * Purchase Order (Company) – order of materials of the company to the different supplier. * Sales Invoice (Supplier) – proof of purchase given by the supplier to the company. * Sales Invoice (Company) – proof of purchase given by the company to the client. * Quarterly Inventory Reports - It is an unconsolidated report of the inventory generated by the company every quarter of the year submitted to the management.

Scenario:

The executive assistant is the one that reviews and searches the past records of the company including its inventory records. The purpose of searching and reviewing the purchasing and inventory records is to analyse and create a decision if it is necessary to buy additional materials or items prescribed by the client. The inventory records include the Purchase order send by different clients (this includes the labor and materials recommend/required by the client to be used for production), Purchase Order sent by the company to the different suppliers, Sales Invoice from the suppliers, and another Sales Invoice send by the company to the client for the price list of the materials they recommend. It also includes the quarterly inventory reports.

There are two large drawers on the main office that serve as the storage of the records including the inventory records of the company. Time consuming process is observed for searching the records on the drawers.

Cause:
* Too much purchasing and inventory papers making the searching process time-consuming. * Documents involved for searching and reviewing is difficult to organize.

Impact:
* Delay on some critical decisions that are connected to the purchasing and inventory process.

Quantification:
Inventory is updated quarterly; searching is done during the inventory period.
Quarterly, inventory period last 3-5 days
Annually, there 12-20 days consumed for inventory process
Average time of searching a record on the drawer = 3 hrs. x 2 drawers = Total of 6 hrs. 6 hrs. x 3 = 18 hrs. || 6 hrs. x 5 = 30 hrs.; Average range of time consumed for searching Records = 18 hrs. – 30 hrs. in a single inventory period. Annually, (18 hrs. x 4 = 72 hrs. || 30 hrs. x 4 = 120 hrs.) 72 hrs. – 120 hrs. Consumed for searching process during the inventory period.

Problem 4: No database backup for all records of purchasing and inventory system.

Documents Involved: (See Indexes for samples)

* Purchase Order (Client) – order (materials and job order) from the client. * Purchase Order (Company) – order of materials of the company to the different supplier. * Sales Invoice (Supplier) – proof of purchase given by the supplier to the company. * Sales Invoice (Company) – proof of purchase given by the company to the client. * Quarterly Inventory Reports - It is an unconsolidated report of the inventory generated by the company every quarter of the year submitted to the management.

Scenario:
The inventory records including the Purchase Order of the client up to the quarterly inventory reports are stored on the two large drawers on the main office. It is used for reviewing the materials available and uses those records for decision-making of the management for purchasing critical items.

Since there is no backup storage on a computer, the company relies only on the manual storage of the drawers. There is a high risk of data and information loss and difficult to update periodically. The loss of data can greatly affect the decision making of the management especially for purchasing materials and items.

Cause:
* No computer backup or database system for the records, documents and forms stored on the drawers.

Impact:
* High risk of loss of information and data due to lack of backup. * Poor in decision making in case of loss of the documents resulting to unnecessary loss of company’s income.

Quantification:
Average incidence loss of inventory reports annually: 1
Average cost that contains inside the report: Php. 10,000.00 – Php. 30,000.00 (Average Overall cost including all the materials: Fabric, rods, remote mechanisms etc.) Total average loss of income annually due to no computer backup of the records: Php. 10,000.00 – Php. 30,000.00

1.4 Scope and Delimitation

The study will focus in analysing the manual recording and updating of purchasing and inventory system of Belen’s Furnishing. These are the entities that will be involved on the study. * Client/s

* Executive Assistant
* Factory Supervisor
* Record Keeper
* Factory Personnel
* Suppliers
The following are the process that we need to study about the purchasing and inventory system of the company: * Recording, updating and management of the inventory process. * Collection of forms, documents and reports from one entity to another which is included on the purchasing and inventory process. * Processing of the collected data and information and generation of reports needed by the company. This study will be focused on analysing the manual recording and updating of the purchasing and inventory system of the company. The system involves the current inventory in hand, product lists, suppliers, and employees who process all the data collected. The system will only focus on the transactions regarding buying from the suppliers based from the recommendation materials of the client, determining the availability of the materials in hand, physical counting of the items, or transferring of supplies from the main office to the factory or vice versa. Quarterly inventory reports are also included on the system. Hence, the study will not cover beyond the purchasing and inventory system.

CHAPTER II: SYSTEM ANALYSIS

2.1 System Name and Background

The Belen’s Furnishing is a soft furnishing company that has a main office for administrative works and a factory for the production of the quality products and storage of the materials they used. The Record keeper of the purchasing and inventory division is the one that prepares and updates the inventory report together with the factory personnel (for manual counting and measuring of materials) and the factory supervisor. All documents and reports will be reviewed, managed and approve by the Executive Assistant of the company. Documents are based in compiled paperwork in 2 large drawers including the data and reports.

The purchasing starts when there is a contract from a client and a purchasing order is provided by the client itself (this includes the labor and the materials recommended/ required by the client). The client also has an option if they will be the one to provide the materials needed. Then the company will provide a purchasing order for the suppliers to buy the materials from needed for the project. Once the suppliers delivered the materials (or the company picked it up directly on the supplier), the supplier will give a sales invoice of the items and the same also for the company that they will provide also a sales invoice for the client. This will indicate that they already brought the materials required by the company. When all materials are set, the project will be now on-progress.

The excess materials, items, accessories and supplies will be added to the inventory and this is called as “Inventory on hand”. Adding items, manual counting and measuring of the materials, updating the inventory report is done by the purchasing and inventory division together with the factory supervisor. Quarterly inventory report will be prepared by the record keeper, checked by the factory supervisor and approved by the executive assistant. The report contains the item/material name, quantity, amount used for each month quarterly, and the balance or the remaining item stored on the inventory. All documents and reports are stored on two large drawers and can be reviewed by the Executive Assistant.

2.2 System Analysis Tools
2.2.1 Systems Outline

I. Purchasing Order from the Client to the Company
a. Labor/Job Order
b. Materials required/recommended by the client
c. If the client will be the one to provide the materials then;
c.1. Transmittal slip (contains the materials to be delivered by the client to the company) II. Purchasing Order from the Company to the Suppliers
a. The materials from the supplier can be acquired by the company thru picked-up or delivery. III. Sales Invoice from the Supplier to the Company
a. Prices of the materials from the supplier
IV. Sales Invoice from the Company to the Client
a. Payment for the supplies brought (Only applicable if the company doesn’t provide the materials) V. The company will do the project.
VI. Recording of Excess Materials.
a. Manual counting and measuring of excess materials by the factory personnel. b. Recording the data on the record notebook by the record keeper. c. Checked and verified by the Factory Supervisor

d. Record notebook will be submitted to and approved by the Executive Assistant VII. Quarterly Inventory report
a. The report will be prepared by the record keeper based on the data on the record notebook. b. The report will be check and verified by the factory supervisor c. The executive assistant will be the one to receive and approved the report. VIII. Reviewing and searching of documents

2.2.2 System Flowchart
MAIN FLOWCHART

Sub-process (Purchasing Materials)

Sub-process (Recording of Excess Materials)

Sub-process (Quarterly Inventory Report)

Sub-process (Searching of Documents)

2.2.3 Grid Chart
| Client/s| Executive Assistant| Factory Personnel| Factory Supervisor| Record Keeper| Suppliers| Purchase Order (Company, Client)| | 1| 1| 1| | 1|
Sales Invoice (Company, Suppliers)| | 1| | 1| | |
Transmittal Slip| | 1| | 1| | |
Record Notebook| | 1| 1| 1| 1| |
Quarterly Inventory Report| | 1| | 1| 1| |

2.2.4 Context Diagram

2.2.5 Data Flow Diagram

2.2.6 Data Dictionary

Sales Invoice
FIELDNAME| FIELD TYPE| FIELD LENGHT| DECIMAL| FORMAT| DESCRIPTION| Name| Alphanumeric| 20| 0| X(20)| Company’s name|
Address| Alphanumeric| 30| 0| X(30)| Company’s address| Tin| Numeric| 10| 0| 9(10)| Company’s tin number|
Date| Datetime| 9| 0| mm/dd/yy| Date received|
Time| Datetime| 5| 0| 99:99| Time received|
Payment Reference| Alphanumeric| 10| 0| X(10)| Reference of the payment| Sales Rep| Alphanumeric| 10| 0| X(10)| Name of the sales rep| Description| Alphanumeric| 20| 0| X(10)| Description of the item| Item Number| Alphanumeric| 10| 0| X(10)| The Item’s number| Quantity| Numeric| 10| 0| 9(10)| The number of items delivered| Unit price| Numeric| 9| 2| ₱₱₱₱₱9.99| Price of the item| Item Discount| Alphanumeric| 5| 0| X(5)| Discount for each item| Extended Price| Numeric| 9| 2| ₱₱₱₱₱9.99| | VAT Sale| Numeric| 9| 2| ₱₱₱₱₱9.99| |

Zero Rated Sale| Numeric| 9| 2| ₱₱₱₱₱9.99| | Total Sale| Numeric| 9| 2| ₱₱₱₱₱9.99| The total of all sales| 12% VAT| Numeric| 9| 2| ₱₱₱₱₱9.99| The 12% VAT of the total price| Total Amount Due| Numeric| 9| 2| ₱₱₱₱₱9.99| The total amount to be paid| Change| Numeric| 9| 2| ₱₱₱₱₱9.99| Change from payment|

Purchase Order
FIELDNAME| FIELD TYPE| FIELD LENGTH| DECIMAL| FORMAT| DESCRIPTION| P.O Number| Numeric| 10| 0| 9(10)| P.O number of the purchase order| To:| Alphanumeric| 20| 0| X(20)| Name of the supplier| P.O date| Datetime| 8| 0| mm/dd/yy| Date of purchasing| Ship via| Alphanumeric| 20| 0| X(20)| By what it was shift| F.O.B point| Alphabet| 10| 0| A(10)| Delivery/ picked up by the company| Terms| Alphabet| 6| 0| A(6)| Paid by Check or Cash|

QTY.| Numeric| 10| 0| 9(10)| The quantity of the item| Unit| Numeric| 10| 0| 9(10)| The type of item|
Description| Alphanumeric| 20| 0| X(20)| The description of the item| Unit Price| Numeric| 9| 2| ₱₱₱₱₱9.99| The price of the item| Total| Numeric| 9| 2| ₱₱₱₱₱9.99| The total price purchased in a single item| Sub- total| Numeric| 9| 2| ₱₱₱₱₱9.99| The sub-total of all item| VAT| Numeric| 9| 2| ₱₱₱₱₱9.99| VAT for the total price| Shipping & handling| Numeric| 9| 2| ₱₱₱₱₱9.99| Shipping and handling fees| Others| Numeric| 9| 2| ₱₱₱₱₱9.99| Other fees| Total| Numeric| 9| 2| ₱₱₱₱₱9.99| Total price of all items plus the fees included|

Transmittal Slip
FIELDNAME| FIELD TYPE| FIELD LENGHT| DECIMAL| FORMAT| DESCRIPTION| Transmittal No.| Numeric| 4| 0| 9(4)| Transmittal Number| To:| Alphanumeric| 20| 0| X(20)| Place where the materials/ items to be transmitted| Subject| Alphanumeric| 20| 0| X(20)| The amount of materials used quarterly| Description| Alphanumeric| 30| 0| X(30)| Description of the item to be transmitted|

Quarterly Inventory Report
FIELDNAME| FIELD TYPE| FIELD LENGHT| DECIMAL| FORMAT| DESCRIPTION| Item Name| Alphanumeric| 20| 0| X(20)| Name of the item| Quantity| Numeric| 6| 0| 9(6)| The number of items|

Usage / month| Alphanumeric| 20| 0| X(20)| The amount of materials used quarterly| Balance| Alphanumeric| 6| 0| X(6)| The remaining balance/amount of the item|

2.2.7 User Requirement
Hardware Requirements| Processing Power:Intel (R) Core (TM) 2 Duo CPU E4600@ 240GHz 2.39GHz. Memory:1.00 GB of RAM Secondary Storage:150GB Hard Disk Drive| Software Requirements| Platform:Microsoft Windows XP Professional Version 2002 Service Pack 3 running on 32 bitWeb browser:Google Chrome, Mozilla Firefox, Internet ExplorerNetwork:Linksys router (Lighthouse Wi-Fi) Ethernet WLAN/ 1Mbps| Personnel Requirements| Any personnel proficient at personal computer| Reports/Databases| None| 

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