What is a Data Processing System?

A data processing system is one that uses a computer program or language to process raw data and transfer data into information by using a method known as transaction processing. Data can be captured from many sources, including direct input of data, punch card files, and external media such as disks, tapes and external drives. The system also analyzes raw data, sorts data according to programming instructions through the software or user intervention, and calculates and disseminates data in the form of a screen inquiry or hard-copy report.

Data processing systems can be traced to the early 1800s. The first punch card system was developed in 1801 by Joseph-Marie Jacquard. In 1833, Charles Babbage created an analytical engine to interpret the holes or information on punch cards. A major shift in technology would happen in the 1880s, when Herman Hollerith developed the tabulator and the key punch machine, which would become basic components of the first data processing systems. In 1890, the United States Census was tabulated with the punch card and key punch machine.

Technological advances during the next 100 years included the invention of the processor and memory functions, hard disk storage and report processing. After World War II, the United States government and computer industry officials created the term “data processing” to define the capturing and processing of data. The first government-based data processing system, the electronic numerical integrator and computer (ENIAC), was commissioned in 1945, starting a trend of automation that continues to evolve.

The basic components of this system are the operating system, low-level programming that involves hardware programming; the processor (CPU), which calculates instructions within milliseconds; the operating system, which handles the software and hardware functions of the system; and the hard disk storage, which stores data on an internal hard drive. A system must have ways to input raw data to formulate information. This data can be entered via a keyboard or external media such as a disk, tape, punch cards or a CD-ROM). Equipment configurations that process data are mainframes, mid-range computers, and client-server networks such as local area network (LAN) and wide area network (WAN) hardware configurations. At the machine or operating system level, these components are synchronized to support a basic data processing system.

Data processing and information systems may appear as interchangeable terms but are very different in theoretical terms. Even though the term "information systems" is widely used in the industry, its roots and elements are in data processing. A data processing system is the engine that starts the information management and analysis process. Information systems provide the decision-making process once data is analyzed and produced.