Each encryption system necessarily consists of three parts:

1.      The key,

2.      The key management system, and

3.      The algorithm (Cipher).

The key management system is a system implemented for the purpose of determining how the keys will be used, which keys will be used, and how they will be controlled. It deals with the secure generation, distribution, and storage of keys. Secure methods of key
management are extremely important. Once a key is randomly generated, it must remain secret to avoid unfortunate mishaps (such as impersonation). In practice, most attacks on public-key systems will probably be aimed at the key management level, rather than at the cryptographic algorithm itself.

The Key is a string of bits, allowing people to encrypt and decrypt data. A key can be used to perform other mathematical operations as well. Given a cipher, a key determines the mapping of the plaintext to the cipher text. It is the information that tells the algorithm
where to begin, a point of origin if you will.

Usually an algorithm is a series of steps used to complete a task. Here it is the process by which the plain text information is transformed to the encoded, or encrypted, information. It is also known as cipher. The two types of ciphers that have formed over the years are Block Ciphers and Stream Ciphers.

A Block cipher accepts a predefined quantity, or space, to be encrypted. If the message is too long to fit in a single block, the message will be broken in to as many blocks as necessary. Once the message is broken in to blocks, each block is then encrypted. This transformation takes place under the action of a user-provided secret key. An example of a block cipher is the Transpositions encryption method.

Decryption is performed by applying the reverse procedure to the cipher text block, whilst using the same secret key. The fixed length is called the block size, and for many block ciphers, the block size is 64 bits. In the coming years the block size will increase to 128 bits as processors become more sophisticated. Iterated block ciphers encrypt a plaintext block by a process that has several rounds. The number of rounds in an iterated cipher depends on the desired security level and the consequent trade-off with performance.

A Stream cipher does not rely on predefined data spaces or blocks of data. A stream cipher modifies each character at a time, without concern for the quantity of data being transmitted. This type of cipher is generally considered faster, but less secure than block ciphers. An example of a stream cipher is Atbash.