Transaction Processing Systems
A transaction processing system is a type of information system that is arguably one of the most important systems that a profitable company can have. Without a transaction processing system, a company with many sales and transactions would have an extremely difficult time keeping track of their day-to-day business. The function of a transaction processing system is to collect, store, modify, and retrieve the transactions of an organization. For example, If a company sells a product online, an electronic payment is made. The amount charged must be withdrawn from one account and deposited into another. A TPS system takes care of that action.
There are two ways that a TPS system can operate. Real time and batch processing differ in the fact that with real time processing, transactions are processed immediately after placing the order. Batch processing is when orders are placed, and then processed at the same time in large batches at a later date. Some key components of a good TPS system are rapid response, reliability, inflexibility, and controlled processing. Fast performance with a rapid response time is crucial. Businesses using these systems cannot afford to have customers waiting. It is important that the system is reliable. A system needs to operate effectively with a low failure rate in order to keep a company running smoothly. Inflexibility means that a TPS system must process each transaction the same way every time. Controlled processing of a TPS system means that the system must support an organization’s operations, for example, an Atm machine for a bank.
A crucial part of TPS systems is the storing and retrieving of data. Data in a TPS system is stored in large databases called “data warehouses”. This data can be retrieved in a number of ways. Data retrieval is organized and quick. This is ensured by good data placement and “high normalization”, which lowers redundant information to increase the speed and improve concurrency. All of the data that is stored in the warehouses is backed up in several different places in order to protect the information it holds. A TPS system is a crucial system for a company to have and is imperative to a company’s success.
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