Transaction processing systems is a business system which handles the processing of financial transaction data. This system is used by the organizational level of an organisation. Transaction processing systems can include payroll systems, order entry systems or automatic teller machines. This system is extremely important within a business as it display significant business information which can be used for data mining. Data mining is a process which allows businesses to discover certain trends or patterns within the stored data and information. A transaction processing system provides a range of components which allow a business to create a competitive advantage against its competitors. The analysis of financial data provides an organisation with the opportunity to study data and discover ways to make the business more efficient and expand their profit margin.
A decision support system has the ability to model information to support mangers and business professionals during the decision making process. Several models of a decision support system include: sensitivity analysis, what if analysis and goal seeking analysis. These models provide businesses with the opportunity to predict or determine how well the business will do within a certain point in time. These models provide an organisation with a competitive advantage as the professionals are more informed about the nature of the market and certain obstacles or opportunities which will prevail if the business chooses to make a decision.
(Baltzan et al, 2010, pages 58&59)
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| Example of a Transaction Processing System |
2. Describe the three quantitative models typically used by decision support systems.
The three quantitative models used typically by decision support systems include: Sensitive analysis, what-if analysis and goal seeking analysis. Sensitivity analysis is the study of the impact that changes in one (or more) parts of the model have on the other parts of the model. Users change the value of one variable repeatedly and observe the resulting changes in other variables. What-if analysis, checks the impact of a change in an assumption on the proposed solution. E.g. a tool used in excel used to predict what will happen if a business chooses to carry out a decision. Goal-seeking analysis finds the input necessary to achieve a goal such as a desired level of output. This model sets a target value for a variable and then repeatedly changes other variables until the target value is achieved.
(Baltzan et al, 2010, page 59)
3. Describe a business processes and their importance to an organisation.
A business process can include, Human resources processes; the roles of this department include developing disabilities employment policies, employment hiring policies, health care benefits, resignations and termination and workplace safety rules and guidelines. This business process is significant to the operations of a business as this department handles any problems that may arise within the business, as well as representing the employees of the business and any events occurring within the organisation.
(Baltzan et al, 2010, page 70)
4. Compare business process improvement and business process re-engineering.
Improving business processes is paramount in order to stay competitive in today’s electronic marketplace. Organisations must improve their business processes because their customers are demanding better products and services, the business must keep up to date to keep their present customers and stops them buying products from other businesses. Business process improvement attempts to understand and measure the current process and make performance improvements accordingly. Business processes should drive technology choices, not the other way around. Businesses that choose technology and then attempt to implement business processes based on technology typically fail. This model contains processes which are designed to set a list of methods which are utilised to implement change effectively and efficiently in order to avoid system failure.
Business process re-engineering is the analysis and redesign of workflow within and between enterprises. Compared to business process improvements, BPR relies on a different school of thought. In the extreme, BPR assumes that the current process is irrelevant, does not work, or is broken and must be overhauled from scratch.
(Baltzan et al, 2010, pages 71-73)
5. Describe the importance of business process modeling (or mapping) and business process models.
Business process modeling is the activity of creating a detailed flowchart or process map of a work process, showing its inputs, tasks and activities in a structured sequence. A Business process model is a graphic description of a process, showing the sequence of the process tasks, which is developed for a specific purpose and from a selected viewpoint. A set of one or more process models details the many functions of a system or subject area with graphics and text. Business process models are significant to a business as they: expose process detail gradually and in a controlled manner, encourages conciseness and accuracy in describing the process, focus attention on the process model interfaces and provides a powerful process analysis and consistent design vocabulary. A business process model can assist an organisation to illustrate several processes and use them to improve to process to make the business more user friendly and convenient. (Baltzan et al, 2010, pages 78-79)
Interesting link: http://www.sparxsystems.com.au/business_process_model.html
(accessed 3/4/11)
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