Transaction Processing System Definition – What is Transaction Processing System?

A transaction processing system is also referred to as TPS; it is a form of an information system which collects, stores, modifies, and also retrieves an enterprise’s data transactions. The transactions are considered to be any event that has passed the ACID test in which information has been generated or modified before being stored in an information system.

Reliable transaction processing systems help commercial enterprises to become and remain successful. The system guarantees that consumers’ orders are honored on time and that the company’s partners and suppliers are paid and can make the necessary payments. Due to these qualities transaction processing systems have become a very important and effective tool for business management. The transaction processing field is led by organizations like the Association for Work Process Improvement and also the Transaction Processing Performance Council.

With a transaction processing system companies are able to process transactions faster which ensure that they have a smooth flow of information and a smooth progression of processes throughout the company.

Some of the characteristics that transaction processing systems have included rapid processing, reliability, standardization, and controlled access.

Having transactions processed rapidly is a crucial quality that companies need to have in order to be successful. Due to the technological world advancing so fast and consumers expecting to see immediate action this statement is becoming even truer. Transaction processing systems are created to be able to process transactions almost instantly which ensures that the consumer’s information will be available to any processes that need it.

Reliability is a great characteristic to have especially because consumers do not look favorably at mistakes made by the companies that they are giving their business to. Due to this transaction processing systems have included comprehensive safeguards along with disaster recovery systems into their design. These additions help to keep failure rates low.

Standardization allows every transaction that is handled by the system to be processed in the exact same way which increases efficiency. In order to guarantee standardization transaction processing systems interfaces are created in order to be able to obtain identical information for every transaction no matter who the customer is.

Transaction processing systems are extremely powerful tools that companies use which makes having controlled access a necessity. Access to the information is restricted to the employees who have to use the information and no one else. This controlled access helps to guarantee that employees who do not possess the necessary skills and abilities will not be able to influence the process.