4.4 System Theory in Detail

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• About System
• Background
• Key Features
• Weaknesses
• Relevance

System theory is considered an integrated model of organisation Theory which combines classical approach and behavioural approach to overcome their weaknesses. It considers that organisation and environment have dynamic relations.

DEFINING SYSTEM

In general, it is defined as the sum of parts of an organisation which have dynamic interaction among themselves and with the environment and maintain a permeable boundary.

The concept of the system comes from the field of biology given by Ludwig von Bertalanffy that in ecosystem organisms are interdependent. There can also be the possibility of chain relationship.
 Similarly organisation also do not exist as a neutral entity , rather they are part and parcel of the environment and they will have to maintain dynamic equillibrium , otherwise, they cannot survive.

SYSTEM AND CONTINGENCY THEORY

MEANING-

Unified whole of parts of the organisation

a)which are interdependent

b)have permeable boundaries

c)have interaction with the environment

d)change, adjust and adopt to survive.

Simon-Inter-organisations and inter-organisational relationship.

Bernard-

               #viewed organisation from system perspectives

                #System is constrained by the totality of its situation

              #contribution-Satisfaction equilibrium theory.

First time -Norbert Wiener gave clean idea bout a system which has five components
1.Input
2.Throughput/Process
3.Output
4.Environment
5.Feedback

The key features of a system

1. Organisation and environmnet have dynamic realtion and will try to maintain equillibrium.

2. There will be an inter-organisational and intra-organisational relationship.

3.In an organisation which is considered as a system will have many sub-systems namely

• Sociology-Psychological factors
• Technology
• Planning 
• Financial 
• Managerial etc,

The managerial subsytem integrates all other subsystes

4. The subsystens will infkuence each other -which was not explained by classical theory.

5. There will be holism, synergy,equifinality, socio-cybernetic system.

• Synergy means a sub-sytem will try ot maintain co-herence and co-ordination with other sub-systems .
• Soio-Cybernetics system means feedback mechanism.
• Holism means coherence.
• Equifinalisty means in a system there are many different ways of acheiving the desired state /outcome.

6. Open system  will try to follow negative entropy ie.. the close system is subject to disintegration (positive entropy as it will fail to adapt to rapid changes. 

Open system will follow the course of syntropy and try to adapt to changes.

According to C.West Chruchman, a system jas followomg features relevant for organisations.

i)It talks about the objective of the system.

ii)what are environmental constraints

iii)what are the resources availbale

d)How different sub-systems interact

e)How managemnet can run the entire system.

Weakness of A system-

i)It is considerwd very abstract and general that ewverything ot will see from system perspective by applying Gestalat Psycology.

ii) It is largely relevant for the big complex organisation and less aplicable for the small and simple organisation. Therefore, it fails to emerge as a unified theory of organisation.

iii) It fails to explain the specific relationship between environment and organisation that how an organisation undergoes changes under a specific environment .

iv)It has more biasness towards the impact of the environment on the organisation. It has very little to say about the impact of the organisation on the environment.

v)We can not say that clasical thinkers were not aware about changes infact they had profounded principles in the context of changes expereinced by society, such as the emergence of industrialises society.

RELEVANCE-OF SYSTEM THEORY

1. It explain the complex relationship between the environment and organisation. The contribution of Herbert-Simon , Chester Bernard, David Easton are considerd very significatn for understanding the dynamics of the organisation.

2. The theroy has become the basis for the emergence of 

a)contingency theory

b)Riggs Ecology of administration and his ideal models

3. System Theory is considered very relevant for public policy alaysis that it is considered an important instrumental model of public policy.

4. It has contemporary relvance due to globalisation and Internationalism where organisations has to face a complex environment.