Each organisation, regardless of its size or purpose, generates data to keep a record of events and transactions that take place within the business. Generating and organising this data in a useful way is called data processing. In this lesson, we shall discuss about various terms such as data, information, data processing and data processing system.
The word “data” is the plural of datum, which means fact, observation, assumption or occurrence.More precisely, data are representations of facts pertaining to people, things, ideas and events. Data are represented by symbols such as letters of the alphabets, numerals or other special symbols.
Data processing is the act of handling or manipulating data in some fashion.
Regardless of the activities involved in it, processing tries to assign meaning to data. Thus, the ultimate goal of processing is to transform data into information.
Data processing is the process through which facts and figures are collected, assigned meaning, communicated to others and retained for future use. Hence we can define data processing as a series of actions or operations that converts data into useful information. We use the term ‘data processing system’ to include the resources that are used to accomplish the processing of data.
Common factors determining the methods of data processing are:
- Size and type of business.
- Timing aspects.
- Link between applications.
- Size and type of business: The method of producing the information depends on the size and type of business. In a very small company a single person may be able to have the time to produce all the information required but as the volume of business increases, more people and aids may be employed. Large volumes of data and information will require the use of large computers. Simple situations indicate the need for fewer people and aid to produce the information and complex situations indicate the need for more people and aids.
- Timing aspects: Some information requirements are less time critical than others. For example, the Payroll and Statements may only be produced once in a month, whereas the invoices may be produced virtually all the time. The timing requirements for information will have considerable bearing on the methods and equipment needed to provide it.
- Link between applications: Where data is needed for more than one information requirement, a different method of processing it may be suggested. A manual system would required separate operations to satisfy the requirements, whereas a computer system would include the automatic use of data in both applications. Thus, computer systems perform a variety of processing operations on a single “pool” data.
Information can be defined as “data that has been transformed into a meaningful and useful form for specific purposes”. In some cases data may not require any processing before constituting information. However, generally, data is not useful unless it is subjected to a process through which it is manipulated and organised, its contents analyzed and evaluated. Only then data becomes information.
There is no hard and fast rule for determining when data becomes information. A set of letters and numbers may be meaningful to one person, but may have no meaning to another. Information is identified and defined by its users. For example, when you purchase something in a departmental store, a number of data items are put together, such as your name, address articles you bought, the number of items purchased, the price, the tax and the amount you paid. Separately, these are all data items but if you put these items together, they represent information about a business transaction.
DATA AND PROCESSING
Data processing is the collection and manipulation of items of data to produce meaningful information. Data processing have involved electronic means, principally the computer. Electronic data processing (ED) distinguish between “data” and “information “. A data processing system takes raw data and, through the power of computer automation, produces information that a set of program applications has validated. Information includes text, arithmetic calculations, formulas and various other types of information and data based on the computer system. A data processing system is also called an automated data processing (ADP) unit or an electronic data processing (EDP) unit.
Electronic Data Processing (EDP)
It refers to the use of automated methods to process commercial data. Typically, this uses relatively simple, repetitive activities to process large volumes of similar information. For example: stock updates applied to an inventory, banking transactions applied to account and customer master files, booking and ticketing transactions to an airline’s reservation system, billing for utility services.
Advantages of Electronic Data Processing
Speed: It is faster than any other machine designed to do similar works.
Accuracy: High speed processing by computer is accompanied by high accuracy results. The electronic circuitry of computer is such that, when the machine is programmed correctly and when incoming data is error free, the accuracy of the output is relatively assured.
Automatic operation: An electronic emes computer can carry out sequence of many data processing operations without human interaction, the various operations are executed by way of a stored computer program.
Decision making capability: A computer can perform certain decision instruction automatically.
Compact storage: Electronic data processing system have the ability to store large amounts of data in compact and easily retrievable form.
Discipline imposes: To solve problem with computer, you must first understand the problem, second, program the computer to give you right answers. Understand a problem is one thing but understanding it to the depth of detail and insight required to program the computer is a completely different matter.
DATA PROCESSING ACTIVITIES
Data processing consists of those activities which are necessary to transform data into information. Man has in course of time devised certain tools to help him in processing data. These include manual tools such as pencil and paper, mechanical tools such as filing cabinets, electromechanical tools such as adding machines and typewriters, and electronic tools such as calculators and computers. Many people immediately associate data processing with computers.
Regardless to the type of equipment used, various functions and activities which need to be performed for data processing can be grouped under five basic categories.
a) Collection: Data originates in the form of events transaction or some observations.
This data is then recorded in some usable form. They may be recorded by direct input device in a paperless, machine-readable form. Data collection is also termed as data capture.
b) Conversion: Once the data is collected, it is converted from its source documents to a form that is more suitable for processing. The data is first codified by assigning identification codes. A code comprises of numbers, letters, special characters, or a combination of these. In case data processing is done using a computer, the data may be transformed from source documents to machine sensible form using magnetic tape or a disk.
c) Manipulation: Once data is collected and converted, it is ready for the manipulation function which converts data into information. Manipulation consists of following activities:
- Sorting: It involves the arrangement of data items in a desired sequence. Usually, it is easier to work with data if it is arranged in a logical sequence. Most often, the data are arranged in alphabetical sequence. Sometimes sorting itself will transform data into information. For example, a simple act of sorting the names in alphabetical order gives meaning to a telephone directory. The directory will be practically worthless without sorting. Business data processing extensively utilises sorting technique. Virtually all the records in business files are maintained in some logical sequence. Numeric sorting is common in computer-based processing systems because it is usually faster than alphabetical sorting.
- Calculating: Arithmetic manipulation of data is called calculating. Items of recorded data can be added to one another, subtracted, divided or multiplied to create new data. Calculation is an integral part of data processing. For example, in calculating an employee’s pay, the hours worked multiplied by the hourly wage rate gives the gross pay.
- Summarizing: To summarize is to condense or reduce masses of data to a more usable and concise form. For example, you may summarize a lecture attended in a class by writing small notes in one or two pages. When the data involved is numbers, you summarize by counting or accumulating the totals of the data in a classification or by selecting strategic data from the mass of data being processed.
- Comparing: To compare data is to perform an evaluation in relation to some known measure. For example, business managers compare data to discover how well their companies are doing.
d) Managing the Output Results: Once data has been captured and manipulated the following activities may be carried out:
- Storing: To store is to hold data for continued or later use. Storage is essential for any organised method of processing and re-using data. The storage mechanisms for data processing systems are file cabinets in a manual system, and electronic devices such as magnetic disks/magnetic tapes in case of computer based system. The storing activity involves storing data and information in organised manner in order to facilitate the retrieval activity. Of course, data should be stored only if the value of having them in future exceeds the storage cost.
- Retrieving: To retrieve means to recover or find again the stored data or information. Retrieval techniques use data storage devices. Thus data, whether in file cabinets or in computers can be recalled for further processing. Retrieval and comparison of old data gives meaning to current information.
e) Communication: Communication is the process of sharing information. Unless the information is made available to the users who need it, it is worthless. Thus, communication involves the transfer of data and information produced by the data processing system to the prospective users of such information or to another data processing system. As a result, reports and documents are prepared and delivered to the users. In electronic data processing, results are communicated through display units or terminals.
f) Reproduction: To reproduce is to copy or duplicate data or information. This reproduction activity may be done by hand or by machine.
THE DATA PROCESSING CYCLE
The data processing activities described above are common to all data processing systems from manual to electronic systems. These activities can be grouped in four functional categories, viz ., data input, data processing, data output and storage, constituting what is known as a data processing cycle.
- Input: The term input refers to the nortone activities required to record data and to make it available for processing. The input can also include the steps necessary to check, verify and validate data contents.
- Processing: The term processing denotes the actual data manipulation techniques such as classifying, sorting, calculating, summarizing, comparing, etc. that convert data into information.
- Output: It is a communication function which transmits the information, generated after processing of data, to persons who need the information. Sometimes output also includes decoding activity which converts the electronically generated information into human-readable form.
- Storage: It involves the filing of data and information for future use.
COMPUTER PROCESSING OPERATIONS
A computer can perform only the following four operations which enable computers to carry out the various data processing activities. The operations are:
- Input/Output operations: A computer can accept data (input) from and supply processed data (output) to a wide range of input/output devices. These devices such as keyboards, display screens, and printers make human-machine communication possible.
- Calculation and text manipulation Operations: Computer circuits perform calculations on numbers. They are also capable of manipulating numerics and other symbols used in text with equal efficiency.
- Logic/Comparison Operations: A computer also possesses the ability to perform logic operations. For example, if we compare two items represented by the symbols A and B, there are only three possible outcomes. A is less than B (A<B); A is equal to B (A=B): or A is greater than B (A > B). A computer can perform such comparisons and depending on the result, follow a predetermined path to complete its work. This ability to compare is an important property of computers.
- Storage and Retrieval Operations: Both data and program instructions are stored internally in a computer. Once they are stored in the internal memory, they can be called up quickly or retrieved, for further use.