What the open system perspective of organizational effectiveness?

Answer 1

The open-systems A perspective which holds that organisations depend on the external environment for resources, affect that environment through their output and consist of internal subsystems that transform inputs to outputs.perspective of organisational effectiveness is one of the earliest and deeply entrenched ways of thinking about organisations. Indeed, the other major perspectives on organisational effectiveness might be considered detailed extensions of the open-systems model

As open systems, organisations depend on the external environment for resources, including raw materials, employees, financial resources, information and equipment. Wesfarmers and other companies could not survive without employees, raw materials, knowledge and so forth. The open-systems perspective also describes numerous subsystems within the organisation, such as processes (communication and reward systems), work units (production, marketing) and social dynamics (informal networks, power relationships). With the aid of technology (such as equipment, work methods and information), these subsystems transform inputs into various outputs. Some outputs (e.g. products and services) may be valued by the external environment, whereas other outputs (e.g. employee layoffs, pollution) have adverse effects. The organisation receives feedback from the external environment regarding the value of its outputs and the availability of future inputs.

According to the open-systems perspective, successful organisations monitor their environments and are able to maintain a close fit with changing conditions.20 One way they do this is by finding new opportunities to secure essential inputs. For instance, many fast-food restaurants struggle to find enough employees, but McDonald's Restaurants has identified several ways to ensure that it has enough qualified staff. It was among the first to recruit retirees. McDonald's UK introduced the 'family contract', which allows members of the employee's family (spouses, grandparents and children over the age of 16) to swap shifts without notifying management.21 Successful organisations also redesign outputs so that they remain compatible with demands from the external environment. For example, sensing a need for environmental responsibility, Bunnings was one of the first companies in this region to discourage use of plastic bags. Similarly, in response to consumer demand and government requirements, car manufacturers have been scrambling to design models that are more fuel-efficient or rely on different energy sources. This open-systems view is reflected in the words of Huh Chang-soo, chairman of Korean conglomerate GS Group: 'Customer needs are changing fast. If we do not detect the changes, and act on them in a timely way, such as by making investments, we will fail.'22