Why transaction processing system

A common example is a company's online store. The transaction processing system coordinates the warehousing and distribution of the item, the credit and bank transaction from the consumer's payment account and the business's management of inventory, sales, profits and payroll.

This complex system has many advantages and disadvantages. In some ways, the main benefit of a transaction processing system can also be a disadvantage: the handling of several thousand operations at once. The transaction processing system must simultaneously coordinate thousands, even millions, of purchases, debit consumers' bank accounts, hold each person's private banking and address information and ship out or process the order to the consumer.

This system is helpful for any business that wants to make selling goods and services easier for consumers. However, this complex system can be difficult to handle if the business is not large enough to utilize a transaction processing system.

Transaction processing systems are a combination of software and hardware used to handle immense quantities of consumer and business data. All of this is very different from real-time processing that is efficient in less complex situations.

The real-time processing offers timely results on each processed transaction that makes it more applicable for smaller enterprises, unlike the batch processing that is time-consuming. In batch processing, user interaction is not required as soon as the transaction begins, however, the real-time processing needs user interface to process each transaction completely.

Transaction Processing System Features There are several features involved in a good transaction processing system. A few of these critical features are described below. The concept behind the use of TPS is to efficiently generate timely results for transactions. Effectiveness is based on the number of transactions they can process at a particular time. Continuous availability The transaction processing system should be a very stable and reliable system that must not crash easily. Disruption of TPS in an organization can lead to work disturbance and financial loss.

Ease of use The TPS should be user-friendly in order to encourage the use and also decrease errors from inputting data. It should be structured in such a way that it makes it easy to understand as well as guarding users against making errors during data-entry. Modular growth The TPS hardware and software components should be able to be upgraded individually without requiring a complete overhaul.

Controlled processing Only authorized personnel, staff members, or employees should be able to access the system at a time. How does a Transaction Processing System Work? Processing in a batch Processing batch transactions 1 requires data collection and batch grouping. Data collected are stored in the form of batches and may be processed anytime.

This long-established technique was used widely in the absence of infotech. In Batch mode, transactions can be processed without any end-user interface and may also be planned to start-up according to the available resources. Batch transaction process examples include bill generation and check clearance. Characteristics of online transaction processing. Processing batch transactions involves data collection and batch grouping.

Data collected are stored in the form of clusters and may be processed anytime. This long-established technique was well utilized in the lack of information technology. Processing in real-time Recent technology innovations allowed the widespread use of real-time processing. RTP maintains instant data processing with the aim of providing a swift transaction verification.

It is highly versatile, and it can work efficiently as a multi-user interface that can be accessed where there is an online network. Input functions: includes the securing of data on the source document, entering of input data in the system and also the validation of data. Output functions: includes the production of the result of the transaction through a screen, monitor or paper.

Storage functions: This is the method by which data is stored for use on the TPS. It involves the storage of information, accessing, sorting, and updating the storing of data.

Processing functions: This is a process by which data is being transformed; it includes calculation, computation, and immediate result. How does Transaction Processing System enhance the operational productivity of an organization? TPS enhances productivity through the following:. TPS efficiently generates on-time results for transaction processes. By being proficient it is able to process a large number of transactions at a particular time.

Continuous availability TPS should be a stable and reliable system that is not susceptible to easy collapse. Interruption in the use of TPS in an organization can lead to serious work disturbance and financial consequences.

It should be designed in such a way that it makes it easy to comprehend and able to guard users against making mistakes during data-entry. Modular growth The TPS hardware and software components should be able to be upgraded individually without completely shutting down business transactions and requiring a total overhaul.

Batch processing works for computing complex data transactions that are valuable at reducing cost for organizations that are involved with high data traffic, unlike the real-time processing that is efficient in less complex situations.

Results The real-time TPS offers an on-time response on each processed transaction that makes it more appropriate for smaller enterprises which are very different from the batch processing that is time-consuming.

Outputs include transaction documents, query response, and reports. Customer use In batch processing, user interaction is not necessary however the real-time processing requires user interface to process each transaction completely.

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