Modern TheorySYSTEM APPROACH

BY: KAMILA ALAMMAR

Objectives:

At the end of the session the student will able to: Identify the Development of General System Theory Identify the different System Assumptions Know the function of system theory Identify the modern management thought features Define the system approach Apply the system theory on the reality Identify the advantages and disadvantages of system

approach

Outlines:

Introduction Development of General System Theory System Assumptions The function of system The modern management thought features System definition Basic Types of Systems The Parts Of System Basic elements of organization

Outlines:

Goals of organization Mckinsey’s 7s Framework Implications of the Systems Approach Factors influence open and close system Example Advantage and disadvantage references

MAJOR CLASSIFICATION OF MANAGEMENT APPROACHES

CLASSICAL APPROACH

SCIENTIFIC MANAGEMENT

BUREAUCRATIC MANAGEMENT

ADMINISTRATIVE MANAGEMENT

BEHAVIORAL APPROACH

HAWTHORNE STUDIES

MASLOW’S NEED HIERARCHY

THEORY X AND THEORY Y

QUANTITATIVE APPROACH

MANAGEMENT SCIENCE

OPERATIONS MANAGEMENT

MANAGEMENT INFORMATION SYSTEM

MODERN APPROACH

THE SYSTEMS THEORY

CONTINGENCY THEORY

EMERGING APPROACHES

Modern Management Theory

With increasing complexities of organizations, the modern

management theories(thoughts) are developed.

Modern theories tend to be based on the concept that the organization is a system which has to adapt to changes in its environment

In modern theory, an organization is defined as a designed and structured process in which individuals interact for objectives (Hicks and Gullet, 1975).

System Approach

The system approach to management views the organizations as a unified, purposeful system composed of integral parts.

This approach gives managers A way of looking at the organization as a hole and as a part of the larger external environment.

Development of General System Theory

GST emerged from the organismic perspective in biology during the 1920s and 1930s ( Bertalanffy , 1968 ) . this perspective recognized the living organism as an aggregate of cells , not fully understandable by analytic reduction into smaller and smaller parts .

The competing mechanistic perspective on the other hand held that reality can be best understood by isolating parts of the organism to determine individual causal chains ( bertalanffy ,1968 ).

Whereas Beatalanffy pursed the comprise , inductive approach of studying individual systems to form generalizations , Ashby ( 1958 ) took the deductive approach of considering all possible systems. Real and theoretic. To further refine the theory

The philosophy , meaning and significance of systems theory were summarized by Laszlo ( 1972 ) as a unitary framework for understanding and studying complex hierarchic systems .

Systems theory was further developed and generalized for application across other disciplines including the sciences .

A classic example from biology is miller's Living Systems model ( 1978 ) .

this model incorporates principles and concepts from GST in a hierarchic model of living systems ranging from the cellular level to organizational and societal level systems

other disciplines incorporating GST include operations research and engineering ( Churchman . 1968), economics ( Bounding, 1956 ), management science ( Kats & Rosenzweig , 1972 ), and sociology ( parsons , 1951 ).

System Assumptions

The first assumption Systems comprise components that functions and

interrelate to from a whole with a purpose, goal , or objective ( Bertalanffy 1968 ) . Churchman ( 1968 ) emphasizes the importance of defining a system's purpose, which reflects the overall objectives of the system in relation to its environment , and specific objectives ranked in order of importance to the system.

System Assumptions

The second assumption in system's theory is that systems can be open or closed (bertalanffy 1968 ) , systems that interact with the environment are open whereas systems that do not interact with , or are isolated from their environments are considered closed . Through interactions , open systems receive input from and provide output to the environment . Hence , living , social ,and organizational systems interact with the environment , at least to some degree, and are considered open .

System Assumptions

The third assumption: systems increase their internal structure and communication as a result of interaction with the environment ( Berlatanffy , 1968 ) . As energy enters the system, The components self-organize within certain prescribed structures and functions that serve to move the system to word goal attainment. Subsystems emerge and relationships are formed in an overall effort to satisfy the goals and objectives of the system as a whole ( Bertalanffy , 1968; Kast & Resenzweig, 1972 ; Miller 1965, 1978).

The function of system Convert information, energy (or) materials into a

planned out come (or) product for use: within the system, outside the system (or) both.

Facilitate understanding of a complex phenomenon by encouraging input information ,and clarifying relationship between different aspects of the phenomenon.

The function of system: A useful framework for the planning and

controlling function of management.

Provide flexible approach to problem solving.

Increase efficiency of the work flow by outline the task in complex points in the process. according to proper time, sequence and specify.

Useful in evaluating effect and efficiency of the total nursing system within health organization.

 

The modern management thought is characterized by the following features :

Systems viewpoint.

Dynamic process of interaction.

Multileveled and multidimensional.

Multimotivated.

Probabilistic.

Multidisciplinary.

Descriptive.

Multivariable.

Adaptive.

THE SYSTEMS APPROACH

System: a collection of parts operating interdependently to achieve a common purpose.

General systems theory: an interdisciplinary area of study based on the assumption that everything is part of a larger, interdependent arrangement.

THE SYSTEMS THEORY APPROACH

In mid 1960s began a decade in which the idea that organizations could be analysed in a systems framework gained a strong following.

The systems approach :a system as a set of interrelated and interdependent parts arranged in a manner that produces a unified whole. Societies are systems and so, too, are computers, automobiles, organizations, and animal and human bodies.

Basic Types of Systems

Closed systemsAre not influenced by and do not interact with their environment (all system input and output is internal)

Open systemsDynamically interact to their environments by taking in inputs and transforming them into outputs that are distributed into their environments

The Organization as a System 21

The Parts Of System:

1. Inputs – are people, money, information, equipment, and materials required to produce and organization’s goods or services. 2. Output – the products, services, profits, loses, employee, satisfaction or discontent, and the like that are produced by the organization. 3. Transformation Process – the organization’s capabilities in management and technology that are applied to converting inputs into outputs. 4. Feedback – information about the reaction of the environment to the outputs that affects the inputs.

5-control (Boundaries):

Can be exerted from inside or outside the system to alter operations in a manner that ensures achievement of desired outcomes.

Control are actions taken by system operators to regulate (input, process, output) elements to improve system functions.

Control over input regulates (the cost of operation).

Control over throughput regulates (time, efficiency, safety of operation).

Control over output regulates (production quality & quantity).

6.Environment. is the context within which the system exists .

The organization consists of the following three basic elements (Bakke, 1959):

Components Linking processes Goals of organization

Components:

There are five basic, interdependent parts of the organizing system: The individual The formal and informal organization Patterns of behavior emerging from role demands of the

organization Role comprehension of the individual The physical environment in which individuals work

Linking processes:

The different components of an organization are required to operate in an organized and correlated manner.

The interaction between them is contingent upon the linking processes, which consist of communication, balance and decision making.

Communication: is a means for eliciting action, exerting control and effecting coordination to link decision centers in the system in a composite form.

Balance : is the equilibrium between different parts of the system so that they keep a harmoniously structured relationship with one another.

Decision analysis : is also considered to be a linking process in the systems approach. Decisions may be to produce or participate in the system.

Goals of organization

The goals of an organization may be growth, stability and interaction. Interaction implies how best the members of an organization can interact with one another to their mutual advantage.

Mckinsey’s 7s Framework© 2007 Pr entice Ha ll, Inc. All righ ts reserved.

Mckinsey’s 7s Framework It is a management model that describes 7 factors to organize a company in an holistic and effective way.

Together these factors determine the way in which a corporation operates. Managers should take into account all seven of these factors, to be sure of successful implementation of a strategy. Large or small.

They're all interdependent, so if you fail to pay proper attention to one of them, this may effect all others as well. On top of that, the relative importance of each factor may vary over time.

McKinsey 7s Model

The Seven Elements

Hard Elements

Strategy

Structure

Systems

"Hard" elements are easier to define or identify and management can directly influence them: These are strategy statements; organization charts and reporting lines

The Seven Elements

Soft Elements Shared Values

Skills Style

Staff

"Soft" elements, on the other hand, can be more difficult to describe, and are less tangible and more influenced by culture.However, these soft elements are as important as the hard elements if the organization is going to be successful.

The Seven Elements

Strategy : Actions a company plans in response to or anticipation of changes in its external environment. It may also be seen as plans for allocation of resources to enable the company’s identified goals.

The Seven Elements

Structure: Basis for specialization and coordination influenced primarily by strategy and by organizational size and diversity. This is also the way that different units in the firm relate to each other.

The Seven Elements

Systems: Formal and informal procedures that support the strategy and structure. Often internal systems are more powerful than they are given credit for. They are also the procedures and processes that characterize how the work should be done and internal systems used to accomplish the needed performance

The Seven Elements

Style: The culture of the organization, how key managers behave and what they do rather than what they say. It answers the questions: How do they spend their time? What are they focusing their attention on?

The Seven Elements

Staff: Human resource management, the processes and efforts used to develop managers, socialization, and the shaping of basic management values, It also includes ways of introducing young recruits to the company, and the support given to manage employees’ careers

The Seven Elements

Skills: These are the distinctive and core competencies of the company, They include the ways competencies are expanded or shifted. This can also be determined from the perspective of core competencies that exist and are developed in the firm.

The Seven Elements

Shared values : Also called super ordinate goals, these are the central believes and attitudes, guiding concepts, and fundamental ideas around which a business is built. Usually stated at the abstract level, they have great meaning inside the organization even though outsiders may not see or understand them. They can be summarized as what extent the company stands for and what it believes in.

Implications of the Systems Approach

Coordination of the organization’s parts is essential for proper functioning of the entire organization.

Decisions and actions taken in one area of the organization will have an effect in other areas of the organization.

Organizations are not self-contained and, therefore, must adapt to changes in their external environment.

Features :Following are the important features of system approach to management

thoughts1. It considers the organizations as a dynamic and inter-related set of

parts. Continuous and effective interaction of sub systems helps to attain goalsof the larger system.

2. It considers the impact of both near and distant future on organizational activities.

3. It integrates goals of different parts of the organization(sub systems or departments) with the organization as a whole. It also integrates goals of the organization with goals of the environment or society in which it operates.

4. It synthesizes the knowledge of different fields of study5 It enables organizations to frame policies that promote business

objectives and social objectives.

Factors influence open and close system:Depended on:

Type of organization.

Type of service of organization system.

Type of interaction in organization system.

Competence of organization system.

Type of boundaries.

Example: Hospital A general hospital capacity 249 bad Human power – 479 qualification The administration of hospital want to develop service

to improve quality care health .Notes : - good building - have good financial - bank policies - provide heath care for all population

Application: (e.g, quality management)

System: is the hospital Subsystems: are the hospital units input : including hospital staff members,

supplies, equipment, financial, patients,…etc Thorough put: including all processes leading

to patient health care, nursing care, education program, hospital activities, and procedures.

output : result of patient care either successful or failed like health status improvement ,or disease complications prevention , patient satisfaction.

Cont, Feedback : from family, patients, hospital

staff. Internal environment: forces from inside the

hospital like hospital administration to putting policy.

External environment : ministry of health that providing policy & procedure and standards to the hospital.

To improve the output the hospital has to improve the input resources.

Internal & external forces affecting on the hospital by removing or adding new standards toward improving hospital quality .

Advantage: This theory provides the following benefits: It provides the holistic view of the organizations and emphasizes on their adaptive nature. It increases the organization’s adaptability to environmental changes.

It analyses the system at different levels and inter-relates and integrates it into a unified set of direction.

It provides a framework for effective interaction of different parts of the organization for attainment of its goal.

It considers the impact of environment on the organization and vice versa. Interaction of external environment with the organization’s internal environment is the most significant contribution of the system theory.

It synthesizes the classical and behavioural theories into broader framework to solve managerial problems.

Disadvantages:

Over-conceptual The approach does not recognize the differences in systems.

Systems philosophy does not specify the nature of interactions and inter-dependencies.

Unpractical: It cannot be easily and directly applied to practical problems.

References:

Sapru, R. (2008). The System Approach. In Administrative theories and management thought (Eastern economy ed.). New Dehli: PHI Learning

The McKinsey 7-S Framework: Ensuring That All Parts of Your Organization Work in Harmony. (n.d.). Retrieved April 27, 2015, from http://www.mindtools.com/pages/article/newSTR_91.htm

The Systems Approach. (n.d.). Retrieved April 27, 2015, from http://www.introduction-to-management.24xls.com/en132

Thelen, E., & Smith, L. (1996). Dynamic Systems Theories. In A dynamic systems approach to the development of cognition and action. Cambridge, Mass.: MIT Press.