Describe business organization as a system?

Answer 1

"A system is a whole made up of parts. Each part can affect the way other parts work and the way all parts work together will determine how well the system works. This is a fundamental challenge to traditional management thinking. Traditionally we have learned to manage an organization by managing its separate pieces (sales, marketing, production, logistics, service, etc.). Managing in this way always causes sub-optimization; parts achieve their goals at the expense of the whole.

Only changing the system solves the problem."

In essence, the systems perspective emphasizes that everything is connected to everything else and that it's often worthwhile to model businesses and processes in terms of flows and feedback loops. Systems thinking stresses linkages and relationships and flows. It emphasizes that any given employee or unit or activity is part of a larger entity and that ultimately those entities, working together, are justified by the results they produce.

To effectively, nimbly, and proactively adapt to the demands of a rapidly changing environment, all system components - inputs, processes, outputs, and feedback - must be managed.

Key points:

• Organizations are systems
• Organizations are processing systems
• Organizations are adaptive systems
• Organization goals must be aligned with the reality of the organization's super-system
• Primary processes must be aligned to meet customer expectations and organizational goals
• Support processes must be aligned with primary process goals
• Functions, jobs, or roles must be aligned to perform the required tasks of the processes
• The human performance system (HPS) components must be aligned - individually, vertically, and horizontally
• Management must do the aligning