SYSTEMS THEORY AND ORGANIZATION

General Systems Theory

1. Systems concepts
A system is a set of interacting components that work together to accomplish specific
goals. For example, a business is organized to accomplish a set of specific functions.
Any situations, which involve the handling or manipulation of materials or resources
of any kind whether human, financial or informative, may be structured and
represented in the form of a system.

Characteristics of a System
i. Purpose – Systems exist to fulfill some objective or satisfy a need. A system
may accomplish more than one task. The purpose of a system is closely tied
to its rationale.
ii. Rationale – This is the justification for a system’s existence.
iii. Efficiency – This is how well a system utilizes its resources, that is, doing
things right using the least amount of resources.
iv. Effectiveness – How well a system fulfills its purpose, assuming that its
purpose is the right one. Involves a system doing the right things.
v. Inputs– Entities that enter the system to produce output or furnish information.
vi. Outputs– Entities that exit from the system either as interfaces or for end-user
activities. They may be used to evaluate system’s efficiency and effectiveness.
vii. Transformation rules – They specify how the input is processed to produce
output.
viii. Throughput – Measures the quantity of work a system accomplishes.
Does not consider the quality of the output.
ix. Boundary – Artificially delimits a system for study or discussion purposes.
System designers can only control those system components within the
boundary.
x. Environment – That which impacts the system but is outside the system’s
boundary. The system cannot control events in the environment.
xi. Interfaces – Points where two systems meet and share inputs and outputs.
Interfaces belong to the environment although they may be inside the
system boundary.
xii. Feedback– Recycles outputs as subsequent inputs, or measures
outputs to assess effectiveness.

Classification of systems
Each system can be characterized along a wide range of characteristics.

Physical systems Vs. Abstract systems

A physical system consists of a set of elements, which are coordinated and operate as
a whole entity to achieve a certain objective. This system may also be called a
concrete system.

An abstract system is an orderly arrangement of conceptual items or components.

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 Simple systems vs. Complex systems
A simple system has few components, and the relationship or interaction between
elements is uncomplicated and straightforward.

A complex system has many elements that are highly related and interconnected.

Open systems vs. Closed systems

An open system interacts with its environment. It is a system with a feedback
mechanism that promotes the free exchange of information between the system and
the external entities. Organizations are open systems.

A closed system has no interaction with the environment. This is a system that neither
transmits information to the outside world nor receives any information from the outside
world. It is mainly a scientific concept (e.g. physics experiments).

Open loop systems vs. closed loop systems

An open-loop system is one which does not act in a controlled manner, that is,
there is no feedback loop, and so it has no measure of performance against
standards.

A closed-loop system is one that functions in a controlled manner. Such a system accepts
inputs, works upon them according to some predefined processing rules and produces
outputs. Such a system is controlled via a feedback loop.

Stable/Static systems vs. Dynamic systems

A stable system undergoes very little change over time. A dynamic system undergoes
rapid and constant change over time.

Adaptive systems vs. Non-adaptive systems

An adaptive system is able to change in response to changes in the environment. These
systems can also be described as cybernetic or self-organizing systems.

A non-adaptive system is not able to change in response to changes in the environment.

Deterministic systems vs. Probabilistic systems

Deterministic systems operate in a predictable manner. For example, thermostats and
computer programs. In probabilistic systems, however, it is not possible to determine
the next state of the system. These systems depend on probability distribution.

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 Permanent systems vs. Temporary systems
A permanent system exists for a relatively long period
of time. A temporary system exists for a relatively
short period of time.

Components of systems Inputs

These provide the system with what it needs to operate. It may include machines,
manpower, raw materials, money or time.

Processes
Include policies, procedures, and operations that convert inputs into outputs.

Outputs
These are the results of processing and may include information in the right format,
conveyed at the right time and place, to the right person.

Systems Boundary
A system boundary defines the system and distinguishes it from its environment.

Subsystems
A subsystem is a unit within a system that shares some or all of the characteristics of
that system.

Subsystems are smaller systems that make up a super-system / supra-system. All

systems are part of larger systems

Inputs
These provide the system with what it needs to operate. It may include
machines, manpower, raw materials, money or time.

Processes
Include policies, procedures, and operations that convert inputs into outputs.

Outputs
These are the results of processing and may include information in the
right format, conveyed at the right time and place, to the right person.

Systems Boundary
A system boundary defines the system and distinguishes it from its environment.

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 Subsystems
A subsystem is a unit within a system that shares some or all of the
characteristics of that system. Subsystems are smaller systems that make up a
super-system / supra-system.

All systems are part of larger systems

Environment
This is the world surrounding the system, which the system is a subsystem of.

Objectives and application of

systems approach Features of
systems theory
1. All systems are composed of inter-related parts or sub-systems and the system
can only be explained as a whole. This is known as holism or synergy. The
systems view is that the whole is more than just some of its parts and those vital
interrelationships will be ignored and misunderstood if the separate parts are
studied in isolation.
2. Systems are hierarchical, that is, the parts and sub-systems are made up of
other smaller parts. For example, a payroll system is a subsystem of the
Accounting System,which is a sub of the whole organization. One system is a
sub of another.
3. The parts of a system constitute an indissoluble whole so that no part can be
altered without affecting other parts. Many organizational problems arise once this
principle is flouted or ignored. Changes to one department could create untold
adverse effects on others - ripple effects: e.g. changing a procedure in one
department could affect others e.g. admissions - faculty ,type of data captured,
process. , etc.
4. The sub-systems should work towards the goals of their higher systems and
should not pursue their own objectives independently. When subsystems pursue
their own objectives, a condition of sub-optimality arises, and with this the falling
of the organization is close at hand! Information systems designers should seek to
avoid the sub-optimality problem!
5. Organizational systems contain both hard and soft properties. Hard properties are
those that can be assessed in some objective way e.g. the amount of PAYE tax with
tax code, size of product-quantifiable
Soft properties - constitute individual taste. They cannot be assessed by any
objective standard or measuring process e.g. appearance of a product, suitability
of a person for job and any problem containing a political element.

Importance of systems theory:

a) It provides a theoretical framework for study of performance of businesses
b) It stresses the fact that all organizations are made up of subsystems, which
must work together harmoniously in order that goals of the overall system
can be achieved.

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c) It recognizes the fact that conflicts can arise within a system, and that such
conflicts can lead to sub-optimization and that, ultimately, can even mean that an
organization does not achieve its goals.
d) It allows the individual to recognize that he/she is a subsystem within a larger
system, and that the considerations of systems concept apply to him/her, also.
e) Given the above factors, it is clear that information-producing systems must be
designed to support the goals of the total system, and that this must be borne in
mind throughout their development.

Systems theory concepts

● Entropy – This is the tendency towards disorder (chaos) in a system. The more
closed a system is, the greater the entropy.

● Feedback – This is a control mechanism in open systems. Feedback involves

measuring the output of the system, comparing the output with a standard and
using any difference to modify subsequent input to ensure that the outputs
conform to the required standards.

● Feed-forward – It means to take steps that make some adjustments to the

system in advance in order to face any expected deviations in future.
Feedback monitors the past results whereas feed-forward deals with future
outcomes.

● Functional Decomposition – This involves factoring a system to its constituent

subsystems. The subsystems are also decomposed further into manageable sizes
resulting in a hierarchy structure of a system. Decomposition is used to analyse
the existing system, to design and finally implement a new system.

● Functional cohesion – Involves dividing into subsystems by grouping

activities that logically go together.

● Coupling – Occurs when two systems are highly interrelated.

● Decoupling – This is a process in which the subsystems are given autonomy

and independence. The subsystems operate independently thereby pursuing
own objectives and enhancing flexibility.

● Synergy – The whole is greater than the sum of its parts. At this point the
focus is on global system needs, not local issues. It means that more than
one system working together produce more and better results than each
would achieve independently.

● Optimization – It is possible to achieve the best solution.

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 ● Entropy – This is the tendency towards disorder (chaos) in a system. The more
closed a system is, the greater the entropy.

● Feedback – This is a control mechanism in open systems. Feedback involves

measuring the output of the system, comparing the output with a standard and
using any difference to modify subsequent input to ensure that the outputs
conform to the required standards.

Elements of control include:

- Goal: This is the expected performance, plan or results.
- Sensor: Measures actual performance.
- Comparator: Compares expected results to actual results obtained.
- Effector: Reports deviation and initiates the response which may lead to a
redirection of activity, revision of the expectation or changing the plan.

● Feed-forward – It means to take steps that make some adjustments to the

system in advance in order to face any expected deviations in future.
Feedback monitors the past results whereas feed-forward deals with future
outcomes.

● Functional Decomposition – This involves factoring a system to its constituent

subsystems. The subsystems are also decomposed further into manageable sizes
resulting in a hierarchy structure of a system. Decomposition is used to analyse
the existing system, to design and finally implement a new system.

● Functional cohesion – Involves dividing into subsystems by grouping

activities that logically go together.

● Coupling – Occurs when two systems are highly interrelated.

● Decoupling – This is a process in which the subsystems are given autonomy

and independence. The subsystems operate independently thereby pursuing
own objectives and enhancing flexibility.

● Synergy – The whole is greater than the sum of its parts. At this point the
focus is on global system needs, not local issues. It means that more than
one system working together produce more and better results than each
would achieve independently.

● Optimization – It is possible to achieve the best solution.

● Sub-optimization – It is an occurrence that occurs when the objectives of one

element or subsystem conflicts with the objectives of the whole system.

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● Sub-optimization – It is an occurrence that occurs when the objectives of one
element or subsystem conflicts with the objectives of the whole system.

● Equifinality – Certain results may be achieved with different initial conditions and
in different ways. In open systems, the same final state can be reached from
several starting points, one result can have different causes, or through different
methods, there is more than one way to achieve the objective.

● Goal-seeking – systems attempt to stabilize at a certain point.

● Holism – the analysis of a system is considered from the point of view of the
whole system and not on individual subsystems. Subsystems are studied in
the context of the entire system.