Handling the Present:Transaction Processing

SystemsCopyright © 2001 by Harcourt, Inc.

All rights reserved

Part 2Part 2

2001

I. S. In OrganizationsI. S. In Organizations

• Transaction processing system (TPS)

• Management Information systems (IS)

• Decision support systems (DSS)

2001

Transaction Processing Systems

• Tracks daily, routine transactions– Order Entry– Payroll– Paying Bills

• Repetitious

• Link to customers, suppliers

• Operations personnel, supervisors

2001

Transactions ProcessingSummary of TPS Characteristics

Characteristic Explanation

Large number of transactions TPS must quickly and efficiently handle alarge number of transactions

Correct transactions TPS must be able to validate correctness oftransactions and correct invalid data

Security problems Transactions involve transfer of funds,resulting in potential security problems

Importance to organization If TPS fails, the organization can quicklycease to operate

2001

TPS DATA FEEDS MIS APPLICATIONS

TPS

ORDER PROCESSING

MATERIALS RESOURCE PLANNING

GENERAL LEDGER

ORDER FILEORDER FILE

PRODUCTION MASTER FILEPRODUCTION MASTER FILE

ACCOUNTING FILESACCOUNTING FILES

MISMIS

MIS FILESMIS FILES

SALES DATA

UNIT PRODUCT COST

PRODUCT CHANGE DATA

EXPENSE DATA

MIS REPORTS

MANAGERSMANAGERS

2001

Management Information Systems (MIS)

• Serves Middle Management• More historical • Summary, Control oriented

– Sales Summary Report

• Used in Decision Making• Done periodically (scheduled)• Exception Reports

– Accounts Past Due Report

2001

2001

Office Automation Systems

• Paperless Office

• Data Workers

• Increase Productivity

• Used in Coordination and Communication– Word Processing– E-mail– Scheduling

2001

Decision Support Systems

• For “problem specific” decision

• Non-recurring decision

• “What-if” oriented– Interactive…run many scenarios

• Future oriented

• Source: TPS, MIS, External data

• Use statistical and modeling tools

2001

Information System Cycle

Tran

sact

ions

Tran

sact

ions

Data Storage

Data Storage

DecisionsDecisions

Remember the PastRemember the Past

Preparing forthe Future

Preparing forthe Future

Handlingthe PresentHandling

the Present

People andTechnologyPeople andTechnology

I. S. In OrganizationsI. S. In Organizations

2001

I. S. In OrganizationsI. S. In OrganizationsType Purpose Role

Transaction processing system (TPS)

Handles transactions and stores result in organizational memory

Handle the present

Organizational memory (MIS)

Stores data from TPS

Remember the past

Decision support systems

Aids employees and managers to make decisions

Prepare for the future

2001

Transactions Processing• Batch processing

–Banking

• Online processing–Point of sale (POS) transaction

processing

–UPC bar code

–Data storage & reporting

2001

POS Transaction Processing System

Bar Code Reader Point of Sale TPS

Receipt

Customer Display

Item Nameand Price

Item Nameand Price

Nameand

Price

UPC

Back Office Server

UPC

Update Inventoryand Purchase Databases

2001

Processing and Manipulating Transaction Data

QueryingDatabases

Classificationof Data

UpdatingDatabases

Combine withOther Data

SummaryData

Edited andCorrected

Data

OtherData

OtherData

2001

Business-to-business TPSClassification of Interorganizational

CommunicationsIOS >> EDI Extranet Internet Intranet

Breadth Businesspartnership

Businesspartnership

Global Organizational

Focus Distributionchannelcooperation

Distributionchannelcooperation

Stakeholderrelationships

Employeecommunicationandcooperation

Reach Narrow Broad Broad Broad

Businessprocesses

Revenue andexpenditure

Revenue andexpenditure

Revenue Expenditureandconversion

2001

Business-to-business TPS

• Value chain

• Supply chain

• Demand chain

2001

Value Chain

• Activities which add a margin of value to the firm’s products or services

• Primary– Related to production and distribution of

products and services

• Support– Organization Infrastructure– Employees and Management

2001

Supply-chain• Deals with

– Managing warehouse– Inventory supplies– Distribution channels

• Find “bottlenecks” in operation• Computer Applications address:

– Demand, Supply, Manufacturing, Transportation, Distribution

• Need human coordination/communication

2001

Demand-chain

• Predict what “WILL” happen

• Get “BIG” picture

• Use data to gain “Knowledge” on future trends vs. just what “HAS” happened

• DSS vs. MIS

• Front-end

2001

Partnerships/Alliance

• Two companies sharing Information or Services to gain Strategic advantage– Banks and Airlines

• Name and Address files

– UPS• Shipping and Tracking

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Remembering the Past withOrganizational Memory

Chapter 5Chapter 5