Background of Systems Theory
‘Systems
Theory’ is often regarded as the foundation of organizational development. The concept of ‘Systems Theory’ firstly
coined in 1938 by ‘Chester Bernard’ in his book ‘Functions of an Executive’ on
which he stated that an organization functioned as a cooperative system. Later
in 1950, biologist ‘Ludwig von Bertalanffy’ articulated the principles of
‘General Systems’ theory. ‘Ludwig von Bertalanffy’ regarded as the founder and
the father of ‘Systems Theory’.
Other contributors: - Katz, Kahn &
Hanna, Kast & Rosenzweig, Kenneth Boulding, Richard Jhonson
System & Systems Theory
The
system approach is based on the concept that an organization is a system. A
system is defined as a number of interdependent parts functioning as a whole
for some purpose. Here there are five components: inputs, a transformation process, outputs, feedback, and the
environment.
According
to ‘Ludwig von Bertalanffy’, systems theory views an organization as an
organism made up of numerous parts (subsystems) that must work together in
harmony for the larger system to succeed. An organizations success relies on:-
Synergy
- Synergy means that the whole is greater the sum of its parts. Synergy is an
important concept for managers in that it reinforces the need to work together
in a cooperative fashion.
Interdependence
between subsystems - A subsystem is a system within a system. From another
perspective, subsystems are parts of a system that depend on one another.
Interconnection
within the organization (closed systems) and between the organization &
environment (open systems) - There are two basic types of systems: closed
systems and open systems. Closed system are not influenced by and do not
interact with their environments. Open systems interact with their environment.
All organizations are open systems, although the degree of interaction may
vary.
Systems Theory in
‘Management’
System
approach to management views the organization as a unified, purposeful system
composed of interrelated parts.
Managers coordinate work activities in the
various parts of the organization, they ensure that all these parts are working
together so the organization’s goals can be achieved. For example, the systems
approach recognizes that, no matter how efficient the production department
might be, the marketing department must anticipate changes in customer tastes
and work with the product development department in creating products customers
want or the organization’s overall performance will suffer.
The systems approach implies that decisions and
actions in one organizational area will affect other areas. For example, if the
purchasing department doesn’t acquire the right quantity and quality of inputs,
the production department won’t be able to do its job.
The systems approach recognizes that organization
rely on their environment for essential inputs and as outlets to absorb their
outputs. No organization can survive for long if it ignores government
regulations, supplier relations, or the varied external constituencies upon
which it depends.
Criticisms of Systems Theory
It
is not a prescriptive management theory. Because:-
·
It
does not specify tools and techniques for practicing managers
·
It
is too abstract – difficult to apply in practical problems
It
does not adequately address power and social inequalities and their causes
Systems philosophy does not specify the nature of interactions and interdependencies.
Lack of
Universality
It is over conceptual and doesn’t recognize the
differences in systems. 