Thanks for your comment, Gary.
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Your #1 option doesn't work for my scenario as I want to do this automatically without having to prompt the user.
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The #2 option is good once I have an input parameter to know what data I need to fetch from the file. For example, if my workflow is running a report, I might need the report id to be passed as a parameter so I can use it to get all the other needed data for that report only (the file may have thousands of reports with their data but I only need to invoke one at this time).
So, I think the solution should be a combination of passing an input parameter to the workflow and then use that to get the other pertinent data, save the data into variables which then will be used by all the activities in the workflow. The goal is to have nothing hardcoded in the workflow. How can one do that?
Toad should probably have a new activity ("Input parameters") to deal with these types of situations whether we get the input data from a flat file or a database and map it to workflow variables.