It is usually accepted that the data will be processed as soon as it is received, thereby affecting the database records immediately.

This means that as soon as the user enters some data and the appropriate action is taken to confirm the data, then the processing will take place. The time taken to provide a response to the user mist also be very quick. The response time of a real-time system is critical, but, depending on the user requirements, it should be less that four seconds.

A real-time system is generally accepted as being one that reacts fast enough to influence behaviour in the outside world. An example of a real-time system is an air-traffic control system. Real-time systems can also be found in embedded applications such as mobile phones.

The amount of data input for each transaction is generally small and is usually entered, interactively, by the user using a form on a screen. The input method is usually by means of a keyboard.

The user inputs responses to pre-defined questions on an input form which is displayed on a GUI. A database is then searched based on the responses. The results of the search are shown on the screen. The questions and responses are in a very structured, fixed format. The user effectively has a dialogue with the system, but without being able to deviate from responding to the questions asked on the input form or from the preferred options presented.

A typical use of an interactive or transactional processing system is for booking tickets. This type of system could be used to book any type of ticket without the risk of double-booking because each transaction is dealt with in turn.

For example, consider a customer who wants to buy a flight ticket. The details of the departure and destination airport along with the preferred dates of travel are input. When these details are submitted, the system checks the database for the seat availability. The flights that are available, based on the requirements given on the form, are shown on the screen. The flight is selected and a confirm action takes place. At this point the seat is confirmed as being booked - this means that no other customer can book the seat on the flight.

The data in a batch system is collected together into batches, sent for processing, stored and processed at an appropriate time. No user interaction is needed in a batch processing system. The time when batch processing is carried out tends to be when there is less demand on the processor, such as at a weekend of at night. This means that there is less disruption to daily work so peripherals remain accessible.

A major disadvantage of batch processing is the delay, hours or days, between collecting the data and receiving the output. The user interface requirements of a batch processing system tend to be code-based.

Payroll processing is one of the most common uses of a batch processing system. Each pay date, weekly or monthly, the payroll details for each employee are collected. The details that are collected could include hours worked, monthly salary, overtime completed and sick days to be deducted from payment. These details are then processed with reference to a master file which holds the details of employees' hourly pay rates, tax and national insurance details, and other regular deductions to be made such as pension contributions. The output from the system is the payslips for all employees.

The decisions about which mode(s) should be used in a system are taken during the design phase of the life cycle. The operating system will then manage the functioning of the operational mode that is being used.