On-Line Transaction Processing

On-Line Transaction Processing is a processing that supports the daily business operations. Also know as operational processing and OLTP.  An OLTP is a database which must typically allow the real-time processing of SQL transactions to support traditional retail processes, e-commerce and other time-critical applications. It is also a class of program that helps to manage or facilitate transaction oriented applications such as data entry and retrieval transactions in a number of industries, including banking, airlines, mail order, supermarkets, and manufacturers.

With today’s business environment, it is impossible to run a business without having to rely on data. Processing online transactions these days increasingly requires support for transactions spanning a large network or even the global internet and may include many companies. Because of this great demand, many new OLTP software implementations use client – server processing and brokering of software applications that can enable transactions to run on various computer platforms within a network.

Today, with the ubiquity of the internet, more and more people even from those remote areas are not doing transactions online through an e-commerce environment. The term transaction processing is often associated with the process wherein an online shop or ecommerce website accepts and processes payments through a customer’s credit or debit card in real time in return for purchased goods and services.

During the process of online transactions, a merchant payment system will automatically connect to the bank or credit card company of the customer and carry out security, fraud and other checking for validity after which authorization to take the payment follows. In is strongly advised that when a company looks for other companies that will handle online transactions and processing, the company should have a system infrastructure that is robust, secure and reliable that give customers fast, seamless and secure checkout time.

An OLTP implementation tends to be very large involving very high volume of data at any given time. Business organizations have invested in sophisticated transaction management software like Customer Information Control System (CICS) and database optimization tactics that can help OLTP process very large numbers and volumes of concurrent updates on an OLTP-oriented database.

There are also many OLTP brokering programs which can distribute transaction processing among multiple computers on a network that can enhance the functions of an OLTP working on a more demanding decentralized database system. Service oriented architectures and web services are now commonly integrated with OLTP.

The two main benefits with using OLTP are simplicity and efficiency. OLTP helps simplify a business operation by reducing paper trails and helping draw faster and more accurate forecasting for revenues and expenses. OLTP helps provide a concrete foundation with timely updating of corporate data. For an enterprise’ customers, OLTP allows the more choices on how they want to pay giving them more flexible time and enticing them to make more transactions. Most OLTP transactions offer services to customers 24 hours a day seven days a week.

But despite the great benefits that OLTP can give to companies and their customers, there are certain issues that it needs to address. The main issues pertaining to OLTP are on security and economic costs. Because an OLTP implementation is exposed on a network, more specifically the internet, the database may be susceptible to hackers and intruders who may be waiting on the side to get sensitive information on people and their bank and credit card accounts.

In terms of economic cost, when a business goes offline to do some steps of a process, buyers and suppliers tend to miss out on the services and benefits of an OLTP and the smallest system disruption may mean loss of time and money. But with proper care and implementation, OLTP still will remain to be a big help to business organizations specially those operating on a large scale.