Types of Information System

Transaction Processing System A transaction processing system is a type of information system. TPSs collect, store, modify, and retrieve the transactions of an organization. A transaction is an event that generates or modifies data that is eventually stored in an information system. Transaction processing system keep on organization running smoothly by automating the processing of the large amount of paper work that must be handled daily. These systems include the accurate recording of transactions as well as the control procedures used in issuing such documents as pay checks, invoices, customer statements, etc. For example, the transaction processing system of a departmental store can record customer purchases, prepare billing and booking of order from suppliers and inter-relate these tasks into an overall accounting system. The transaction processing system of a college helps performing such tasks as enrolling students in courses, billing students for tuition, and issuing pay cheque.

The main purpose of this system is to allow the businesses that are using it be able to keep track of all of the business transactions that they have made in a manner that is both reliable and effective, despite whether their business is online or offline. Typical examples of such systems would be Airline Reservation Systems, Banking Systems, or the Accounting System of almost any large company.

Transaction processing systems were among the earliest computerized systems. Their primary purpose is to record, process, validate, and store transactions that take place in the various functional areas/of a business for future retrieval and use. A transaction processing system (TPS) is an information system that records company transactions (a transaction is defined as an exchange between two or more business entities). Transaction processing systems (TPS) are cross-functional information systems that process data resulting from the occurrence of business transactions. Transactions are events that occur as part of doing business, such as sales, purchases, deposits, withdrawals, refunds, and payments. Transaction processing activities are needed to capture and process data, or the operations of a business would grind to a halt.

Types of Transactions

When a department orders office supplies from the purchasingdepartment, an internal transaction occurs, when a customer places an order for a product, an external transaction occurs.

Internal Transactions: Those transactions, which are internal to the company and

are related with the i nternal working of any organization. For example Recruitment Policy, Promotion Policy, Production policy etc External Transactions: Those transactions, which are external to the organization and are related with the external sources, are regarded as External Transaction. For example sales, purchase etc.

Characteristics of Transaction Processing Systems

Features of TPS
1. A TPS supports different tasks by imposing a set of rules and guidelines that specify how to record, process, and store a given transaction. There are many uses of transaction processing systems in our everyday lives, such as when we make a purchase at retail store, deposit or withdraw money at a bank, or register for classes at a university. Almost all organizations, regardless of the industry in which they operate, have a manual or automated TPS 2. A TPS is the data life-line for a company because it is the source of data for other information systems, such as MIS and DSS (Decision Support Systems). Hence, if the TPS shuts down, the consequences can be serious for the organization 3. A TPS is also the main link between the organization and external entities, such as customers suppliers, distributors, and regulatory agencies 4. TPS exist for the various functional areas in an organization, such as finance, accounting, manufacturing, production, human resources, marketing quality control, engineering, and research and development. Until a few years ago, many companies viewed the TPS for each business function as separate entity with little or no connection to other systems in the company. Today, however, many companies are trying to build cross-functional TPS to promote the free exchange of information among different business units. This is a desirable goal, but is still very difficult to achieve

Executive Support System

An executive information system (EIS) is a type of management information system intended to facilitate and support the information and decision-making needs of senior executives by providing easy access to both internal and external information relevant to meeting the strategic goals of the organization. It is commonly considered as a specialized form of decision support system (DSS). n
Executive Support System ("ESS") is designed to help senior management make strategic decisions. It gathers, analyses and summarises the key internal and external information used in the business.

Executive Support System (ESS) is a reporting tool (software) that allows you to turn your organization's data into useful summarized reports. These reports are generally used by executive level managers for quick access to reports coming from all company levels and departments such as billing, cost accounting , staffing, scheduling, and more. In addition to providing quick access to organized data from departments, some Executive Support System tools also provide analysis tools that predicts a series of performance outcomes over time using the input data. This type of ESS is useful to executives as it provides possible outcomes and quick reference to statistics and numbers needed for decision-making.

Advantages of EIS

Easy for upper-level executives to use, extensive computer experience is not required in operations Provides timely delivery of company summary information Information that is provided is better understood Filters data for management

Improves tracking information Offers efficiency to decision makers

Disadvantages of EIS

System dependent Limited functionality, by design Information overload for some managers Benefits hard to quantify High implementation costs System may become slow, large, and hard to manage Need good internal processes for data management May lead to less reliable and less secure data