Significance of Processing of Data

30/01/2021 0 By indiafreenotes

Data processing is the conversion of data into usable and desired form. This conversion or “processing” is carried out using a predefined sequence of operations either manually or automatically. Most of the processing is done by using computers and other data processing devices, and thus done automatically. The output or “processed” data can be obtained in various forms. Example of these forms include image, graph, table, vector file, audio, charts or any other desired format. The form obtained depends on the software or method used. When done itself it is referred to as automatic data processing. Data centers are the key component as it enables processing, storage, access, sharing and analysis of data.

Importance of data processing includes increased productivity and profits, better decisions, more accurate and reliable. Further cost reduction, ease in storage, distributing and report making followed by better analysis and presentation are other advantages. The need to process data is now widely realized and reflected in every field of work. Let the work be done in a business atmosphere or for educational research purpose, data management systems are used by every business. It is a multidimensional process which is involved in almost every field of human life. Generally speaking, the term “Data Processing” is used where you have to collect innumerable data files from different sources.

Methods of Data Processing

There are number of methods and types of data processing. Based on the data processing system and the requirement of the project, suitable data processing methods can be used. Generally, Organizations employ computer systems to carry out a series of operations on the data to present, interpret, or to obtain information. The process includes activities like data entry, summary, calculation, storage, etc. A useful and informative output is presented in various appropriate forms such as diagrams, reports, graphics, etc. Data processing is  mainly  important in business and scientific operations. Business data is repeatedly processed, and usually needs large volumes of output. Scientific data requires numerous computations and usually needs fast-generating outputs. Three methods of data processing have been presented below:

Manual Data Processing

Data is processed manually without using any machine or tool to get the required results. In manual data processing, all the calculations and logical operations are performed manually on the data. Similarly, data is transferred manually from one place to another. This method of data processing is very slow, and errors may also occur in the output. Mostly, Data is processed manually in many small business firms as well as government offices & institutions. In an educational institute, for example, marks sheets, fee receipts, and other financial calculations (or transactions) are performed by hand.

This method is avoided as far as possible because of the very high probability of error, labour intensive and very time-consuming. This type of data processing forms the very primitive stage when technology was not available, or it was not affordable. With the advancement of technology, the dependency on manual methods has drastically decreased. This also makes processing expensive and requires large manpower depending on the data required to be processed. Example includes selling of commodity on shop.

Mechanical Data Processing

In this method, data is processed by using different devices like typewriters, mechanical printers or other mechanical devices. This method of data processing is faster and more accurate than manual data processing. These are faster than the manual mode but still forms the early stages of data processing. With invention and evolution of more complex machines with better computing power this type of processing also started fading away. Examination boards and printing press use mechanical data processing devices frequently. Any device which facilitates data processing can be considered under this category. The output from this method is still very limited.

Electronic Data Processing

This is a modern technique to process data. The data is processed through a computer; Data and set of instructions are given to the computer as input, and the computer automatically processes the data according to the given set of instructions. The computer is also known as Electronic Data Processing Machine. Electronic Data Processing is the fastest and best available method with highest reliability and accuracy. Technology used is the latest as this method uses computers. Manpower required is minimal. Processing can be done through various programs and predefined set of rules. Processing of large amount of data with high accuracy is almost impossible which makes it best among the available types of data processing. For example, in a computerized education environment results of students are prepared through a computer; in banks, accounts of customers are maintained (or processed) through computers, etc.

Applications of Data Processing

  • Data Analysis: In a science or engineering field, the terms data processing and information systems are considered too broad, and the more specialized term data analysis is typically used. Data analysis makes use of specialized and highly accurate algorithms and statistical calculations that are less often observed in the typical general business environment.
  • Commercial Data Processing: Commercial data processing involves a large volume of input data, relatively few computational operations, and a large volume of output. For example, an insurance company needs to keep records on tens or hundreds of thousands of policies, print and mail bills, and receive and post payments.
  • Almost all fields: It is impossible to think of any area which is untouched by data processing or its use. Let it be agriculture, manufacturing or service industry, meteorological department, urban planning, transportation systems, banking and educational institutions. It is required at all places with varied level of complexity.
  • Real World Applications: With the implementation of proper security algorithms and protocols, it can be ensured that the inputs and the processed information is safe and stored securely without unauthorized access or changes. With properly processed data, researchers can write scholarly materials and use them for educational purposes. The same can be applied for evaluation of economic and such areas and factors. Healthcare industry retrieves information quickly of information and even save lives. Apart from that, illness details and records of treatment techniques can make it less time-consuming for finding solutions and help in reducing the suffering of the patients.

Types of Data Processing

There are number of methods and techniques which can be adopted for processing of data depending upon the requirements, time availability, software and hardware capability of the technology being used for data processing. There are number of types of data processing methods.

Batch Processing

This is one of the widely used type of data processing which is also known as Serial/Sequential, Tacked/Queued  offline processing. The fundamental of this type of processing is that different jobs of different users are processed in the order received. Once the stacking of jobs is complete they are provided/sent for processing while maintaining the same order. This processing of a large volume of data helps in reducing the processing cost thus making it data processing economical. Batch Processing is a method where the information to be organized is sorted into groups to allow for efficient and sequential processing.

Online Processing is a method that utilizes Internet connections and equipment directly attached to a computer. It is used mainly for information recording and research. Real-Time Processing is a technique that can respond almost immediately to various signals to acquire and process information. Distributed Processing is commonly utilized by remote workstations connected to one big central workstation or server. ATMs are good examples of this data processing method. Examples include: Examination, payroll and billing system.

Real time processing

As the name suggests this method is used for carrying out real-time processing. This is required where the results are displayed immediately or in lowest time possible. The data fed to the software is used almost instantaneously for processing purpose. The nature of processing of this type of data processing requires use of internet connection and data is stored/used online. No lag is expected/acceptable in this type and receiving and processing of transaction is carried out simultaneously. This method is costly than batch processing as the hardware and software capabilities are better. Example includes banking system, tickets booking for flights, trains, movie tickets, rental agencies etc. This technique can respond almost immediately to various signals to acquire and process information. These involve high maintenance and upfront cost attributed to very advanced technology and computing power. Time saved is maximum in this case as the output is seen in real time. For example in banking transactions.

Online Processing

This processing method is a part of automatic processing method. This method at times known as direct or random-access processing. Under this method the job received by the system is processed at same time of receiving. This can be considered and often mixed with real-time processing. This system features random and rapid input of transaction and user defined/ demanded direct access to databases/content when needed. This is a method that utilizes Internet connections and equipment directly attached to a computer. This allows the data to be stored in one place and being used at an altogether different place. Cloud computing can be considered as an example which uses this type of processing. It is used mainly for information recording and research.

Distributed Processing

This method is commonly utilized by remote workstations connected to one big central workstation or server. ATMs are good examples of this data processing method. All the end machines run on a fixed software located at a particular place and make use of exactly same information and sets of instruction.


This type of processing perhaps the most widely used types of data processing. It is used almost everywhere and forms the basis of all computing devices relying on processors. Multi-processing makes use of CPUs (more than one CPU). The task or sets of operations are divided between CPUs available simultaneously thus increasing efficiency and throughput. The break down of jobs which needs be performed are sent to different CPUs working parallel within the mainframe. The result and benefit of this type of processing is the reduction in time required and increasing the output. Moreover, CPUs work independently as they are not dependent on other CPU, failure of one CPU does not result in halting the complete process as the other CPUs continue to work. Examples include processing of data and instructions in computer, laptops, mobile phones etc.

Time sharing

Time based used of CPU is the core of this data processing type. The single CPU is used by multiple users. All users share same CPU but the time allocated to all users might differ. The processing takes place at different intervals for different users as per allocated time. Since multiple users can uses this type it is also referred as multi access system. This is done by providing a terminal for their link to main CPU and the time available is calculated by dividing the CPU time between all the available users as scheduled.