Commercial Data Processing

Why do large companies use computers?

Huge number of documents requiring to be processed Speed of access to data - ability to search through a large number of records quickly Ability to do repetitive tasks without errors Data can be processed much faster Ability to share and manage information

Types of companies

Which type of companies use commercial data processing?

•

Supermarkets

•Chain stores with branches throughout the country •Mail Order / On – line Companies •

Banks and building societies

•

Airlines

•

Police

What is data?

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.

Data or Information ??

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.

The 4 stages of the Data Processing Cycle

Data Collection and Preparation Data Output Data Input Data Processing and Storage

Data collection and preparation stage

The first stage in the data processing cycle is to collect and prepare data so that the computer can understand it.

Data can be collected in a variety of different ways for example it may be written down or printed on a form.

Data Input stage

Data

must be entered

computer before it can be processed. Data may be input to the

directly

via bar codes, magnetic stripes, mark sense cards, MICR, OCR and Smart Cards

Direct data input methods

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 food products.

They store information about the product such as: item code, manufacturer, country of origin, size etc. 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.

Magnetic stripe

You can see a magnetic stripe on the back of a bank card, underground ticket and your Q card.

A stripe can hold 64 characters of data.

Must be handled with care as they can be easily damaged/bent.

Mark Sense Cards

    A Mark Sense card is divided into columns with spaces for you to mark with a pencil or black pen.

A mark sense reader, reads the marks by scanning them optically.

They are useful for collecting and marking responses to multiple choice tests They are also used by the National Lottery

MICR

Magnetic Ink Character Recognition Used on cheques to print the cheque number, branch number and account number.

A computer can then read this information and sort the cheques into order to be returned to the correct bank and branch very quickly.

MICR Characters!!!!

OCR

Optical Character Recognition Used to read letters or numbers which are typed or handwritten into the computer.

Used widely by the Post Office to sort mail prior to delivery by the Postman.

OCR

Smart Cards

    Smart Cards are credit cards that contain a chip.

The Chip can contain much more information than a magnetic strip Smart cards have between 16 and 64 kilobytes of memory They are used on credit cards, bank cards, loyalty cards and on ID cards

Smart Cards

Checking data

Data must be entered accurately otherwise errors will occur in the processing stage.

Data may be checked using   Data Validation – checking that the data is allowable and sensible Data Verification – checking that the data is correct

Data Validation Techniques

Check digits

Check digits are used at the end of barcodes. An extra digit is added to the end of the barcode number, this is calculated from the original number. As the barcode is entered, the computer calculates the check digit. If it doesn’t come up with the same number an error has occurred while entering the barcode.

Check digits

Range check

dd/mm/yy

Checks to ensure data falls within an acceptable range. For example days of a month must fall somewhere between 1-31.

This might not be an acceptable date to book your holiday – it has already passed!

Length check

Used to ensure data is of a certain length.

For example   a PIN for a bank card must be 4 numbers long, if only 3 numbers or 5 numbers are entered, an error occurs.

Passwords must be at least 6 characters long so an entry of **** would be rejected

Data Verification Techniques

Double entry

One of the most reliable methods of checking data…..

Data entered by first data preparation staff member Same data entered by second staff member Changes/differences are highlighted and investigated then corrected

Presence Check

Another verification method is a presence check – making sure that the user has entered data before they can move on.

Or simply asking them to check their actions e.g. “Are you sure you want to log off? Yes /No”

TEXTBOOK

Now Read Pages 168-175 Of the NEW John Walsh Text Book then answer the following questions:  Foundation Pg 193 KU Q1-5 PS Q1  General Pg194 KU Q1-4 PS Q1-8  Credit Pg195 KU Q1-3 PS Q1 Ask your teacher which level(s) you should answer

Practical Exercise

Use Smart Ideas to create a mind map of data input – a possible start is shown below.

The 4 stages of the Data Processing Cycle

Data Collection and Preparation Data Output Data Input Data Processing and Storage

Data Processing Stage

Data Processing and storage stage

Data is stored and processed using the standard database structure of Files, records and fields where:    A File is an organised collection of data arranged according to a particular structure A record is a unit of data that makes up a file and A Field is an individual data item that makes up the record.

 A File in the database is updated when it is changed, or when new data is added to it to bring it up to date.

Backing up

It is important that valuable data is not lost if a file gets damaged.

You should always make a backup copy of your work and keep it in a safe place (away from the original) It is recommended that you keep more than one copy and take your backups on a regular basis!!

How is data processed?

Batch – gathered together and processed in one set. Interactive – data is processed as it is received and updates the information held on the computer after each transaction.

Reading Data Files

There are 2 ways of reading the information in a data file: Sequential Access – data files stored in one sequence may only be accessed in the same sequence e.g. magnetic tape.

Random (Direct) Access optical discs and chips.

– Data files can be accessed in any order e.g. magnetic discs,

Data Output Stage

Data Output Stage

After being processed data is generally output in a variety of forms: Computer screen entering Printer e.g. in a supermarket each till has a VDU so that the checkout assistant can see what they are e.g. in a supermarket in order to produce your till receipt File e.g. in a supermarket to record stock levels etc

Hardware

Hardware required for a Commercial Data Processing system

The basic hardware of a CDP system is a mainframe computer. This will consist of:       A CPU Input devices e.g. keyboard, bar code readers etc Output devices e.g. monitors, printers Backing Store Devices e.g. magnetic tape or optical disc Terminals (used to enter data consist of only a keyboard, monitor also known as a dumb terminal) terminals may be in a separate location (known as remote terminals) Operators console which is connected directly to the CPU

• A mainframe computer can be the size of a whole room and can cost millions of pounds!!

Terminals do not have to be in the same room (or even building) as the mainframe computer A terminal which is connected to a mainframe in another building is called a remote terminal

Multi-access

(multi-user) means that many users can be “on-line” to the same processor at the same time

Costs

Initial costs Purchase of hardware and software and re-training staff Running costs Electricity, toner, paper, maintenance and upgrade

Effects on Business

Job losses - Computers have replaced many of the people who used to carry out data processing so fewer people are needed Re-training – companies who introduce computers will have to teach their employees how to use the machines as well as maintaining and programming them.

New Jobs – new business has been created such as e-commerce, on-line banking and on-line shopping

Staff required

Many new types of jobs will be created which did not exist before.

Systems Analyst

Looks at the manual tasks carried out in a company and decides if these can be carried out by a computer instead – this is called systems analysis The systems analyst will spend a lot of time talking to the people who currently do the jobs The systems analyst writes a report detailing the installation and maintenance of the new system After the system is installed and working the systems analyst looks for ways to improve the system and make it more efficient

Programmers

The Systems Analyst consults the programmers who then write the code for the programs required (if they are not already commercially available).

Programs which are already written are called “off the shelf” Programs written specifically to suit a company are called “bespoke” The programmer is also concerned with removing any mistakes which there may be in the code – this process is called “de-bugging” Also writes documentation on how to use the software effectively

Network Manager

Person in charge of the network Responsible for all the computers attached to the network Concerned with the day to day running of the system Decides on levels of access and network privileges and assigns identities and passwords Can solve low-level maintenance problems to avoid calling out an engineer.

Engineer

This person is responsible for the maintenance and repairs of all computer equipment.

Maintenance is carried out at regular intervals as well as when there is a break down.

E- Commerce

E-Commerce

Electronic commerce The process of conducting business “on-line” Involves buying and selling goods over the internet and transferring funds electronically

On-line Shopping

One of the most common uses of the internet On-line shopping uses encryption to protect your bank details (Encryption is changing the data into a code which needs a special “key” to de-code it. www.play.com

www.hmv.co.uk

Advantages for the company of on-line shopping

Lower transaction costs – it is cheaper to sell on-line than off-line (you don’t need to have premises or pay staff or bills etc) Larger purchases per transaction – customers often will buy other goods which are related to the one they want.

Shops are open 24 hours a day at no extra cost which is good for impulse buyers

Advantages to customers

They can shop from the comfort of their own home – and 24 hours a day!

You can easily search a large catalogue to easily find what you are looking for You can compare prices between sellers so that you don’t have to pay more than you need to Improved customer relations – can use “tracking” so see when your items have been sent You can use a “shopping basket” and think about your purchases but them later if you are unsure.

Disadvantages of on-line shopping

Bank card fraud can sometimes occur when goods are bought using a stolen credit card – known as “card holder not present” Most deliveries of goods are during the working day which is unsuitable for people who work Returning goods can be difficult if the goods are damaged or unsuitable.

On-Line Banking

Advantages for banks –   No need for branches Increase the number of bank cards and decrease the use of cash Advantages for customers   Customers do not need to travel to a branch to do their banking Available 24 hours a day

On-line Banking

Electronic Funds Transfer (EFT)

This is a modern banking system which registers the transferring of funds from one place to another without actually transferring cash.

For example, it is often used to pay for shopping at the supermarket. The customer hands over their SWITCH card which is then run through a magnetic stripe reader, and the amount is entered. The money is transferred from the customer’s account into the supermarket’s bank account automatically.

Point of Sales (POS)

The place where the transaction takes place – the checkout Advantages    Records stock levels so you know when items are running out and need to be re-ordered Gives itemised receipts so customers can see exactly what they have been charged for Fewer staff are needed as the checkout process is faster

Advantages of EFT-POS

People like to use this as they do not need to carry cash which could be lost or stolen.

Also it is much faster than writing a cheque.

Companies such as supermarkets like this as they do not need to hold as much cash which could be a security risk.

Also companies do not need to wait 3 days for a cheque to clear to obtain their money.

Crime

Computer Crime

The Computer Misuse Act came into force to protect people’s and company’s data.

It prosecutes anyone found hacking a computer system or maliciously spreading viruses.

Computer Crime

Accuracy and Privacy of Information  All information must be registered under the Data Protection Act   All data must be kept accurate and up to-date Information must be kept secure and private- only those allowed to see it should be able to

Computer Crime

Customer Lists and the Law  The Advertising Standards Authority imposed regulations on the sale and transfer of mailing lists since January 1992. It states that    The person must be told when their data is being collected and that it may be used for direct mail The person must have the right to stop their name from being used in this way If anyone asks an advertiser to stop using their details they must do so

Ways to Prevent Computer Crime

To protect your data you could     Allocate usernames and passwords to each user Use different levels of access for different people Encrypt your data Use physical protection e.g. lock away your discs, lock the room or use voice recognition or biometrics

Advantages of CDP

The overall advantages to businesses of using CDP systems are:      Orders can be processed much more quickly than with a manual system making the process more efficient Errors are less likely because of the inbuilt checks via validation and verification It is easier for the company to maintain contact and hold information about a large number of customers It is easy to keep the large customer database on backing storage and to keep it up-to-date It is easy to promote the business by the use of direct mailing via mail merge.

TEXTBOOK

Now read pages 176 - 193 of your John Walsh Text Book Ask your teacher which of the following questions to answer  Foundation Pg 193 KU Q6 – 13 PS Q2-4   General Credit Pg 194 KU Q5-11 PS Q9-11 Pg195 KU Q4-8 PS Q2-6