Transaction Processing System (TPS) is a computerized system that manages and processes routine transactions necessary to conduct business. It consists of both hardware and software components that host a transactional-oriented application. TPS is responsible for capturing, processing, and storing transactional data in real time, ensuring the smooth operation of various business processes.



A typical TPS consists of the following components:

1. Hardware: The hardware component of a TPS includes servers, network infrastructure, storage devices, and input/output devices. These components work together to support the processing and storage of transactional data.

2. Software: The software component of a TPS comprises the transactional-oriented application that performs the necessary functions to process transactions. It includes database management systems, transaction processing monitors, and application programs.

3. Transactional-Oriented Application: This application is designed specifically for handling transactions. It provides functionalities such as order entry, online reservations, payroll management, employee records management, manufacturing, and shipping. Each transaction is processed individually and in real time.

4. Database Management System (DBMS): The DBMS is responsible for managing the database that stores transactional data. It ensures data integrity, security, and efficient access. The DBMS allows concurrent access to the database, enabling multiple users to perform transactions simultaneously.

5. Transaction Processing Monitor (TPM): The TPM controls and coordinates the processing of transactions. It ensures that transactions are executed in an orderly manner and provides features such as transaction logging, recovery, and concurrency control.



TPS handles various types of transactions that are essential for conducting business. Some common types of transactions include:

1. Order Entry: TPS manages the process of capturing and processing customer orders, including product selection, pricing, and inventory management.

2. Online Reservations: TPS facilitates the booking and management of reservations for hotels, flights, rental cars, etc.

3. Payroll: TPS handles the calculation and processing of employee salaries, deductions, and tax withholdings.

4. Employee Records: TPS maintains employee records, including personal information, employment history, performance evaluations, and benefits administration.

5. Manufacturing: TPS manages the manufacturing process, including inventory management, production scheduling, and quality control.

6. Shipping: TPS handles the shipping process, including order fulfillment, packaging, and tracking.



Transaction processing in TPS involves the following steps:

1. Transaction Capturing: The TPS captures transactional data from various sources, such as user input, electronic devices (e.g., barcode scanners), or external systems (e.g., online orders).

2. Transaction Validation: The captured data is validated to ensure its accuracy, completeness, and compliance with predefined rules and constraints.

3. Transaction Processing: The validated transactions are processed based on the specific requirements of the transactional application.