Systems theory has unearthed the process of understanding the complex world of systems. In organizations, systems theory is applied through systems analysis. It is done through systems thinking, which helps us to study the organization, its patterns, structures and events.
Thus, systems thinking provides us with a broader perspective to identify the actual issues and its causes, more like a diagnostic tool and accordingly, facilitates the appropriate process of intervention to correct the organizational odds.
We can list the systems principles as under:
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i. Organizational systems follow a pattern of events in a cycle.
ii. Each pattern of event indicates some specific phases, and at each phase, the behaviour of the organization changes
iii. Systems interpret patterns and events in their organizations
iv. Systems seek balance with the environment of the organization
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v. When systems do not interact with their environment, it becomes limited
vi. A circular relationship exists between the overall system and its parts
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Traditionally, an organization is viewed as a closed system. Closed systems perspectives consider everything as deterministic; hence, according to closed systems approach, the organizational structure should be more or less fixed, depending on the preferences of a specific organization.
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However, in today’s changing world, the open systems approach to organization is considered. Open systems approach has been characterized by importation of energy, throughput, output, cycles of events, negative entropy, information input, steady or dynamic homeostasis, differentiation, integration and coordination and equifinality.
Such characteristics were actually emerged from the consideration of the organization as a living system. According to Louis E. Boone and David L. Kurtz (1992), cycle of events is a process in an organization that follows open systems, by which it receives inputs from the environment and then transforms them to generate outputs.
Negative entropy represents the ability of the organization to autonomously repair itself and then survive and grow by importing resources from its environment and transforming them to outputs. Organizations, through steady or dynamic homeostasis, maintain equilibrium over a period of time.
Through differentiation, organizations develop structures and also specialized functions. Equifinality principle of the organization follows open systems and achieves the objectives of the organization through several different courses of action.
Operational research or management science approach has emerged as a separate discipline from the systems percept of organization. It is an extension of systems analysis and systems engineering approach. Operational research conceptualizes the general pattern of conceiving, designing and implementing with some given specifications optimizing the resource utilization in efficient and effective manner.
In the process, it also tries to reduce the negative side effects. Systems engineering approach encompasses technological, organizational and societal systems. It follows four different stages like, systems analysis, systems design, implementation and operation. At systems analysis stage, an organization defines the systems, identify different sub-systems and establish their interrelationships.
At systems design stage, an organization builds the systems model, optimizing the resources. At the implementation stage, the final design is built, keeping in view various eventualities, which could cope with uncertainties. Finally, at the operation stage, supports are provided to continue with the designed systems documenting the activities involved, user manuals, training, etc.
Thus, both systems analysis and systems engineering provide a general way of thinking about practical situations requiring the creation of a system that achieves some predefined purpose.