Transaction Processing & Enterprise
Resource Planning Systems
Chapter 9
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Principles and Learning Objectives
• An organization’s TPS must support the routine, dayto-day activities that occur in the normal course of
business and help a company add value to its
products and services.
– Identify the basic activities and business objectives common
to all transaction processing systems.
– Describe the inputs, processing, and outputs for the
transaction processing systems associated with order,
purchasing, and accounting business processes.
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Principles and Learning Objectives
• TPSs help multinational corporations form
business links with their business partners,
customers, and subsidiaries.
– Identify the challenges that multinational corporations
must face in planning, building, and operating their
TPSs.
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Principles and Learning Objectives
• Implementation of an enterprise resource
planning system enables a company to achieve
numerous business benefits through the
creation of a highly integrated set of systems.
– Define the term enterprise resource planning system
and discuss the advantages and disadvantages
associated with the implementation of such a system.
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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An Overview of Transaction
Processing Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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TPS, MIS/DSS, and Special
Information Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Traditional Transaction Processing
Methods & Objectives
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Batch processing systems
On-line transaction processing (OLTP)
On-line entry with delayed processing
Process data generated by and about transactions
Process data generated for and about transactions
Maintain a high degree of accuracy and integrity
Produce timely documents & reports
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Traditional Transaction Processing
Methods & Objectives
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Increase labor efficiency
Help provide improved service
Help build and maintain customer loyalty
Achieve competitive advantage
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Batch versus On-Line Transaction Processing
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Integration of a Firm’s TPSs
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Examples of Transaction Processing
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Transaction Processing Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Transaction Processing Activities
• Data collection
– Should be collected at source
– Should be recorded accurately, in a timely
fashion
• Data editing
• Data correction
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Document Production and Reports
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Control & Management Issues
• Business resumption planning
• Disaster recovery
– Backups
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Transaction Processing Audit
• Does the system meet its business
requirements?
• Are there procedures and controls?
• Are the procedures & controls properly used?
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Order Processing Systems
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Order entry
Sales configuration
Shipment planning
Shipment execution
Invoicing
Customer relationship management (CRM)
Routing and scheduling
Scheduling systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Document Production Reports
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Traditional Transaction
Processing Applications
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Order Processing Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Order Processing Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Order Entry System
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Shipment Planning
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Inventory Status Report
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Invoicing
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Customer Relationship Management
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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The 15 Top-Rated CRM
Software Packages
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Purchasing Systems
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Inventory control
Purchase order processing
Receiving
Accounts payable
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Purchasing Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Accounts Payable
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Accounts Payable
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Accounting Systems
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Accounts Receivable
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Accounts Receivable Aging Report
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Typical Paycheck Stub
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Payroll Journal
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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General Ledger
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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General Ledger
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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ERP Software Vendors
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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International Issues
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Different languages and cultures
Disparities in information systems infrastructure
Varying laws and custom rules
Multiple currencies
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Enterprise Resource
Planning
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Enterprise Resource Planning
• Real-time monitoring of business functions
• Supports human resources, sales, and
distribution
• Accommodates the different ways each
company runs business
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Advantages of ERP
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Eliminates costly, inflexible legacy systems
Improved technology infrastructure
Improved work processes
Increased data access for decision making
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Disadvantages of ERP
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Expense & time
Radical change
Integrating with other systems
One vendor risks
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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ERP System
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Business Application
Programming Interface (BAPI)
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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Summary
• Transaction Processing Systems - consist of all
components of a CBIS, including databases,
telecommunications, and people
• Transaction Processing Systems Methods - batch,
on-line, and on-line with delayed processing
• Enterprise resource planning (ERP) software - a set
of integrated programs that manage a company’s vital
business operations for an entire multisite, global
organization
MSIS 110: Introduction to Computers; Instructor: S. Mathiyalakan
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