Although data processing and data management system both
refer to function that take raw data and transform it into usable information. The
usage of the terms is very different. Data processing is the term generally
used to describe what was done by large mainframe computers from the late 1940’s until the early 1980’s large volume of raw transaction data fed into program
that update a master file, with fixed-format report written to paper.
The term of Data Management System refers to an expansion of
this theory, where the raw data, previously copied manually from paper to punched card and latter into data
entry terminals, is now fed the system from a diversity of resources, including
ATMs, EFT and direct customer entry through the internet. The concept of master
file has been mainly relocated via database management systems and static
reporting replaced or improved by Ad-Hoc
reporting and express inquiry, including downloading of data by customers. The
ubiquity of the internet and the personal computer have been the driving force
in the transformation of Data Processing to the more global concept of Data
management Systems.