January 29, 2022


Accounting + Finance Blog

Meaning of Distributed Data Processing System in AIS

Meaning of Distributed Data Processing System in AIS

An effective AIS is possible when data is processed electronically. In doing so, a centralized or distributed data processing system (DDP) is appropriate. The use of DDP is more available in recent times although its first trial was by IBM in 1975. In this article, let’s give more explanation about the term.

Definition of Distributed Data Processing

1. It is a type of data processing in which each end-users are allowed to process and control data via their Information Processing Unit (IPU).
2. According to John Hall, distributed data processing is the reorganization of entities “IT functions into small information processing units (IPU) that are distributed to each end-user and placed under their control.”

Key Explanations

Type of data processing. DDP is one of the two types of data processing. The other, centralized system connects all end-users to a single server. Therefore, the users do not have control over the data he or she processed. But DDP changed that! It gives every user a measure of control.

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IT function. In a centralized system, the Information Technology Function is separated. Information Technology is a cost center. Therefore, there is a department for it. In most cases for DDP, the IT may not exist as a department. Instead, every department manages its own IT.

Information Processing Unit. Each department in an organization using DDP has its Information Processing Unit (IPU). The IPU is the department’s powerhouse where data collected within the department are processed, stored, and retrieved. For example, the IPU of the marketing department will process new customer registration, client billing, orders received, number of clients owing, and more. In addition, Distributed data processing ensures that each department has control over its IPU.

Other things you should know about DDP

DDP is the frontier for data processing in organizations. It is a broad concept with terms like end-user computing, networking, commercial software, and office automation. Although it has its disadvantages, DDP is economical and operationally feasible than its counterparts. Another aspect here is the distribution of data to the department or geographical location or both where it occurs. These functions process their data without requiring a central server in the entity. They also have full control over their data.

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DDP processes data in an IPU of each functional department or location of an organization. Here, there is no need for a central server and an IT department to oversee the data of an organization. Finally, the major terms are end-user computing, networking, commercial software, and office automation.