Commercial Data Processing

1
Commercial Data Processing

• The Need for CDP

2
Manual System of CDP

• All information was recorded on paper records and
  stored in filing cabinets
• Thousands of people were employed to type up
  invoices, reminder letters to renew policies and
  to calculate workers pay
• Bank balances, pensions and benefits were
  manually counted
• These processes were very slow and errors often
  occurred
• Each letter and invoice had to be typed from the
  start each time
• Paper records were easily lost
• If one person had a record no person could see
  that record until it had been returned

3
Computer System of CDP

• Large, fast computers carry out millions of
  processes every day
• Vast amounts of data can be accessed and
  processed at the same time
• Calculations processed at high speed
• Repetitive tasks, such as calculating and
  printing invoices or bank statements to be
  carried out quickly and accurately
• Huge amounts of data can be stored in a small
  space
• No need to duplicate information as more than
  one person can access a file at the same time
• Easy to produce management reports i.e.
• Financial information profit or loss of a
  company
• Sales information items that are selling well
  and items that need to be put on special offer
• Customer information contact details and
  records of their custom

4
Write the following statements into your jotter
and fill in the missing words from the box at the
bottom of the screen.

• Commercial Data Processing is the use of
  computers to gather, ______, process and _______
  data on a large scale.
• CDP systems are better than manual systems
  because they
• Can cope with ______ volumes of data
• Can handle __________ work easily
• Can _______ data at high speed
• Are very _________ and eliminate mistakes
• Offer ________ access to the data

Output instant high repetitive
process store accurate
5

• Commercial Data Processing is the use of
  computers to gather, store, process and output
  data on a large scale.
• CDP systems are better than manual systems
  because they
• Can cope with high volumes of data
• Can handle repetitive work easily
• Can process data at high speed
• Are very accurate and eliminate mistakes
• Offer instant access to the data

6
Types of companies

• Which type of companies use commercial data
  processing?
• Supermarkets
• Chain stores with branches throughout the country
• Mail order companies
• Banks and building societies
• Airlines
• Police

7
Write the following statement into your jotter.

• Management Information
• Single Entry Multiple Use of Data

Once data has been entered into the CDP system,
the system makes it instantly available to
everyone with access to the system. This is
central to smooth running of the business or
organisation. e.g. in a bank, once data about an
account withdrawal is entered it is available to
any teller in the branch of the bank and indeed
to the bank manager as well as the customer.
8
What is data?
Write the following into your jotter.

• Difference between DATA and INFORMATION

• Data is a general term for numbers, characters
  and symbols which are input, processed and stored
  by the computer. When you know the meaning of
  data it becomes information.

9
What is data?

• For example, take the number 12345 this is data,
  however if we know the meaning of it, 12345
  becomes information.
• 12345 could be a price, a weight, a house number,
  an order number or a part number.
• This is then information.

10
The 4 stages of the Data Processing Cycle
Write the following into your jotter.
Now answer the questions on WECAL
11
1.Data Collection and Preparation

• Data collection is the gathering of information
  which can happen in many ways.
• E.g. filling forms (application forms, lottery
  tickets, multiple choice exam), booking a holiday
  at the travel agents, using a cash card at the
  cash line machine.
• When the data is on a form, that form is called a
  SOURCE DOCUMENT.
• Data has to be entered accurately a database is
  only as good as the accuracy of the data it
  contains!!
• Source documents have to be carefully designed to
  gather information. Well designed forms have

1. Short clear questions 2. Need only short
answers 3. Enough space for the answer
4. Example answers 5. Multiple choice answers or
Y/N
12
Direct data input methods
Bar codes
Magnetic stripe
MICR (Magnetic Ink Character Recognition)
OCR (Optical Character Recognition)
Optical Mark Recognition
Smart Cards
13
Bar codes

• A bar code is a set of lines varying in widths
  which are read by passing a light pen or bar code
  reader across them.
• Bar codes are found on most products.
• They store information about the product such as
  country of origin, the company that makes the
  product, the item itself and the check digit.
  (The check digit makes sure the data has been
  scanned correctly)
• Bar codes do not hold the price, the item code is
  sent to the mainframe computer which finds the
  price of the article and then reduces the number
  in stock by one.

14
Magnetic stripe

• You can see a magnetic stripe on the back of a
  bank card, train ticket and your lunch card.
• A strip can hold 64 characters of data.
• Must be handled with care as they can be easily
  damaged/bent.
• Bank card Does not hold persons name or
  personal identification number (PIN)
• Magnetic stripe cards are now easy to forge

15
MICR

• Magnetic Ink Character Recognition
• Used on cheques to print the cheque number,
  branch number and account number.
• Can be read by a machine with great accuracy and
  also by humans
• When a cheque is paid in, a magnetic ink
  character reader is used to input the information
  to the computer system
• Difficult to forge as magnetic ink cant be
  photocopied

16
OCR

• Optical Character Recognition
• Used to read letters or numbers which are typed
  or handwritten. (Cant read badly formed letters
  or numbers)
• Used widely by the Post Office to sort mail prior
  to delivery by the Postman.

17
Optical Mark Recognition

• Also known as mark Sense
• Allows people to block out numbers on a form e.g.
  Lottery ticket
• The form is then entered into a machine to read
  the marks (A mark sense reader)
• This gives a very fast and reliable method of
  entering simple data into the computer.

18
Smart Cards

• Replacing magnetic stripe cards for bank credit
  cards
• Use an embedded computer (or chip) that
  contains same data as magnetic stripe
• Difficult to forge
• Do not lose the information stored in their
  microchips, unlike magnetic strips, which are
  easily damaged
• When buying goods must use a PIN instead of your
  signature

19
Verification

• Ensures that data has been entered correctly
• Changing your password uses double entry
  verification

20
Validation

• Ensures that data makes sense
• Range check Is the number entered within a
  certain range? E.g. A month must be in the range
  1 to 12
• Length check Have the correct number of
  characters been entered? E.g. Credit card numbers
  must be made up of 16 digits
• Check digit This is calculated from the series
  of numbers on a bar code and added on to the end

21
Now go to your computers and test your knowledge
so far of Commercial Data Processing at the
following links
http//www.kelso.scotborders.sch.uk/departments/co
mputing/resources/sg_hotpot/cdpo.htm http//www.
kelso.scotborders.sch.uk/departments/computing/res
ources/fling_the_teacher/CDP.html
22
Data processing, storage output
23
Data storage

• Data has to be stored in an organised way that
  the computer can make sense of.
• The Data should be stored in a FILE which
  contains lots of similar information. This is
  likely to be stored in a database.
• All the information together about one item being
  processed makes up a RECORD.
• Each individual piece of information is called a
  FIELD.
• As soon as there is a transaction eg a sale the
  file is updated to keep the data accurate

24
Backup
Write the following into your jotter

• Backups are used to make a copy of the data to
  ensure that if one version is lost or damaged
  then it can be replaced with the copy
• Backups should be kept in a different place to
  the original files so that any accidents will not
  affect more than one set of data.

25
Interactive Processing
Write the following into your jotter

• Interactive processing allows files to be updated
  immediately after an input is made (real time)
• Examples
• ATM Machine
• Airline Reservation Systems

26
Multi-User Databases
Write the following into your jotter
Multi-User Access

• Multi user access allows many people to use the
  same data files at the same time.

27
Random/Direct Access
Write the following into your jotter

• Random/direct access allows files to be read
  directly without having to go through all files
  until the required file is reached
• Interactive processing is only possible if the
  files are stored on hard disc media. This is
  because hard disc drives allow random/direct
  access to the stored data

28
Sequential Access
Write the following into your jotter

• Backup copies are often made to magnetic tape
  that offers sequential access which must be read
  back in the same order it was written
• Not suitable for interactive processing

29
Output to Screen
Output of Information

• Output to screen displays the results of computer
  processing but does not create a permanent record
  of the output

30
Output to Paper

• The results of processing can be printed to paper
  to create a permanent record

31
Output to File

• Outputted data can be saved as a new file to hard
  disc or magnetic tape to be reused again

32
Activity

• Go to your computers and logon to the Internet
• Go to www.Ryanair.com
• Find out what flight times are available for two
  people flying from Prestwick to London Stanstead
  next Monday.

33
Hardware and Software
CDP Systems generally use very powerful computers
called MAINFRAMES. These usually have

• Very fast processors
• Large internal memory capacity
• Large backing storage capability
• Many terminals

34
Hardware and Software
A (dumb) Terminal has a keyboard and a monitor
but NO PROCESSOR (CPU).
Terminals are connected to the CPU of the
Mainframe computer.
Terminals that are far away from the computer are
called REMOTE Terminals. These would be
connected by telephone lines and would be part of
a Wide Area Network.
35
Social Implications of CDP
Effects On Business
Small companies that cannot afford big Mainframe
computers may not be able to compete with larger
companies using CDP applications.
If more people shop from home using mail order
then the high street shops could lose business.
36
Effects on Business

• Computers make companies more efficient and
  increase profits
• Orders can be processed faster than manual
  systems
• Large numbers of customers can be contacted with
  bulk mailings
• Enquiries can be dealt with quickly as all the
  information is displayed on the screen
• CDP enhances service that keeps customers
  satisfied and can generate repeat business

37
Job Types Careers

• The widespread use of computers has led to an
  increase in many new job roles
• Systems Analyst
• Programmers
• Engineers
• Network Manager

38
Systems Analyst

• Looks at the manual tasks carried out in a
  company and decides if these can be carried out
  by a computer instead.
• Directly responsible for the development of a
  system and will draw up a systems flow diagram.

39
Programmers

• Write the code for the programs according to the
  systems flow diagram.
• Write documentation that explains how the program
  works.

40
Engineer

• The main duties of the engineer are
• Installing computer system.
• Provides maintenance for computer systems.
• Repairs computer systems.

41
Network Manager

• The Network Manager is responsible for the
  day-to-day running of the computer network
• They decide each users level of access to the
  system and issue user ids and passwords to gain
  access to the system

42
Job Types Careers - Activity

• Logon to your computers and search the Internet
  for vacant positions for the following jobs
• Systems Analyst
• Programmers
• Engineers
• Network Manager
• Write down brief details of the responsibilities
  of these positions and the salaries offered.

43
Technical Economic Implications of CDP
44
E-commerce

• E-commerce is the ability to buy and sell goods
  electronically, companies, such as e-bay allow
  you to buy and sell goods

45
Online Shopping

• Online shopping allows you to buy goods
  electronically using a cash card and have the
  goods delivered to your home

46
Online Banking
Online banking allows clients to check their
bank statements, pay bills, transfer money from
one account to another and arrange loans
47
Electronic Funds Transfer (EFT)
Electronic Funds Transfer allows bills to be
paid by computer without any money changing hands
48
Point of Sale (POS) Terminals
Point of Sale (POS) terminals are shop
check-outs which are connected directly to the
shops mainframe computer and also to the bank
secure network
49
Electronic Funds Transfer at Point of Sale?

• EFT at POS works by the customer entering their
  PIN
• The shops mainframe computer contacts the bank to
  check there is enough money in the customers bank
  account
• Once this is verified the cost of the goods is
  deducted from the customers bank account and
  added to the shops bank account
• Each of the goods bought is deducted from the
  shops stock file

50
What do companies need to set up e-commerce?

• Have to buy the hardware
• Have to buy the software
• Lease a very fast internet connection
• Employ web designers
• Employ engineers
• Employ network managers
• Employ systems analysts
• Employ programmers
• Deliver the goods

51
E-Commerce Running Costs

• Hardware maintenance
• Paying for consumables (printer ink, toner,
  paper, magnetic tapes for backups)
• Lease the Internet connection
• Paying the staff
• Upgrading the hardware and software as technology
  improves
• Delivering goods to customers

52
E-commerce Initial Costs
These are the costs at the beginning when the
computer system and software are paid for. These
include

• Buying and setting up the hardware and software
• Buying furniture and providing suitable
  ventilation and lighting
• Training Courses

Initial costs can be very high although they
should be worth it in the long term since the
computer system should make the business run more
efficiently.
53
Advantages of E-commerce

• E-commerce gives companies access to the mass
  market
• Businesses can be run by one person and set up
  from home

54
Security Privacy Implications

• Accuracy of information
• Privacy
• Physical Security
• Software Security
• Sale of Customer Lists

55
Computer Crime Fraud
If criminals manage to breach the security
surrounding the data held on CDP systems they can
commit a wide range of crimes such as

• Copy sensitive data
• Steal the access codes and IDs which allow access
  to peoples accounts
• Steal money from accounts
• Change data held on the system
• Disable the system using viruses
• Make counterfeit magnetic stripe cards to access
  bank accounts

56
Laws to Protect Data
Go to your computers, look up the following laws
on the Internet and then write a short paragraph
about each in your jotter

• The Data Protection Act 1984
• The Computer Misuse Act 1990
• The Computer Designs and Patents Act 1988