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Transaction Processing Systems

Transaction Processing Systems. Manual or automatic – all businesses systematically process transactions Function: process routine, day-to-day business activities Computerized TPS: Batch Online (real-time, OLTP) The foundation of business systems. Batch TPS.

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Transaction Processing Systems

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  1. Transaction Processing Systems • Manual or automatic – all businesses systematically process transactions • Function: process routine, day-to-day business activities • Computerized TPS: • Batch • Online (real-time, OLTP) • The foundation of business systems MIS 175 Spring 2002 Chapter 9MIS 221

  2. Batch TPS • Originally, the only available option • Transactions accumulated over period of time • Time period – day, week, month • Transaction records accumulated in files • When batches are processed, what happens? • Update databases • Generate reports • Generate transactions for other systems MIS 175 Spring 2002 Chapter 9MIS 221

  3. Batch Processing Pros and Cons • Pros • Relatively easy to program, install and maintain • Batches can be processed during low-activity periods • Cons • Information is delayed MIS 175 Spring 2002 Chapter 9MIS 221

  4. Online TPS (OLTP) • Transactions are processed in real time • Required for any “modern” application where time is critical • Well supported by client/server computing model MIS 175 Spring 2002 Chapter 9MIS 221

  5. Hybrid TPS • OLTP applications can feed transactions to batch systems • Examine: GL only updated once per day • Real time order capture with delayed processing MIS 175 Spring 2002 Chapter 9MIS 221

  6. TPS Requirements • Capture, process and store transactions • Produce reports and information about transactions • Produce transactions for other TPS • Be accurate and timely • Be efficient – require less labor • Increase customer service • Increase competitive advantage MIS 175 Spring 2002 Chapter 9MIS 221

  7. TPS Activity Model • Data capture • From online entry or “external” system • Data validation • Should be done as close to source as possible • Processing • Data manipulation • Database updating • Generation of transactions for other systems • Archive Transaction • Create documents and reports MIS 175 Spring 2002 Chapter 9MIS 221

  8. Management Issues • Uptime • How long can the system be “down” before significant costs are incurred? • Processing Delays / Response Times • How quickly must a transaction be processed? • What is the worst online response time that is acceptable MIS 175 Spring 2002 Chapter 9MIS 221

  9. Management Issues (2) • Disaster Recovery • What plans are in place to recover lost business data? • What plans are in place to resume business processing in case of disaster? • Audit • Can you verify the integrity of the system? • How will you know if transactions are not processed or are processed incorrectly? MIS 175 Spring 2002 Chapter 9MIS 221

  10. TPS By Function • Order Processing • Procurement & Inventory Control • Accounting MIS 175 Spring 2002 Chapter 9MIS 221

  11. Order Processing TPS • Order capture • Variety of means • Configuration • Shipment planning and inventory allocation • Prioritize orders, select shipment locations, allocate inventory to orders • Shipping and warehousing • Picking, packing, invoicing, reporting MIS 175 Spring 2002 Chapter 9MIS 221

  12. Procurement • Inventory Control • Raw materials, WIP, FGI, etc • Purchase Order Processing • Generating, transmitting, maintaining purchase orders • Receiving • Accounts Payable • Boundary between procurement and accounting MIS 175 Spring 2002 Chapter 9MIS 221

  13. Accounting • Accounts Payable • Accounts Receivable • Budget • Payroll • General Ledger • Asset Management MIS 175 Spring 2002 Chapter 9MIS 221

  14. Disadvantages of Functionally Organized TPS • Processing inefficiency • Data redundancy • Causes integrity problems • Inefficient • Temporal integrity problems • Caused by different times at which processing occurs • Lack of information coherence MIS 175 Spring 2002 Chapter 9MIS 221

  15. Enterprise Resource Planning Systems • Key word is Enterprise: solution designed for entire enterprise • All processes organized around one enterprise-wide data model MIS 175 Spring 2002 Chapter 9MIS 221

  16. Advantages of ERP • Elimination of costly legacy systems • Old systems are expensive to maintain and reduce business agility • Improvement of processes • ERP may have implemented best-in-class processes • Improve data access and data integrity • Provide complete, consistent view of enterprise data MIS 175 Spring 2002 Chapter 9MIS 221

  17. Disadvantages of ERP • Implementation cost • Software and hardware • Expertise • Opportunity costs • Time to implementation • Lengthy and difficult process • MOC (management of change) challenges • System integration difficulties • Vendor dependence MIS 175 Spring 2002 Chapter 9MIS 221

  18. Current ERP Vendors • SAP • Baan • PeopleSoft • Oracle • J. D. Edwards • Manugistics MIS 175 Spring 2002 Chapter 9MIS 221

  19. R/3 Architecture • Functionally rich • More functional options than a business will ever need • Logical • Built around information model • 10,000 tables • Control tables • Application data tables • Heavily parameterized MIS 175 Spring 2002 Chapter 9MIS 221

  20. R/3 Architecture (con’t) • Hardware • PC Clients • Application server • Database server • Public interfaces • BAPI • Customization • ABAP Development System MIS 175 Spring 2002 Chapter 9MIS 221

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