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Systems View of Management

 Managing Systems

Another way to look at the manager’s job is from the perspective of managing systems.


A system is a set of interrelated and interdependent parts arranged in a manner that produces a unified whole. It’s a concept taken from the physical sciences and applied to organizations. The two basic types of systems are Closed systems are not influenced by and do not interact with their environment.

Open systems

dynamically interact with their environment. Today, when we call organization systems, we mean open systems, that is, an organization that constantly interacts with its environment. approach is based on the notion that organizations can be visualized as systems of interrelated parts or subsystems that operate as a whole in pursuit of common goals. This will be discussed in more detail in the next session. 1. The major components of a system are:

a. Inputs:

the various human, material, financial, equipment, and informational resources required to produce goods and services.

b. Transformation processes:

the organization’s managerial and technological abilities that are applied to convert inputs into outputs.

c. Outputs:

the products, services, and other outcomes produced by the organization.

d. Feedback:

information about results and organizational status relative to its environment.

2. Open versus closed systems.

These are terms indicating the relative degree with which a system interacts with its environment. While there are very few, if any, completely open or completely closed systems, we usually view open systems as those having continual interaction with its environment. Closed systems are those with little interaction and feedback from their environments.

3. Two major characteristics of open systems are:

a. Negative entropy

is the ability of open systems to bring in new energy in the form of inputs and feedback from the environment in order for the organization to delay or to arrest entropy, the decaying process.

b. Synergy

is the ability of the whole to equal more than the sum of its parts.

c. The systems viewpoint

suggests that managers are likely to be more successful if they attempt to operate their units as open systems rather than as closed system. Raw Materials Employees’ Work Products and Services Human Resources Activities Financial Results Capital Management Activities Information Technology Technology and Human Results Information Operations Methods


Answer to Test Yourself on Management Viewpoints and Theories!!!! 1. What are some early evidences of management practice?

Some early evidences of management practice are the Egyptian pyramids, the Great Wall of China, and the status of Venice as a major economic trade center in the 1400s.

2. Explain why division of labor and the Industrial Revolution were important to the study of management.

Division of labor increases productivity by increasing each worker’s skill and dexterity, saves time that is commonly lost in changing tasks, and creates labor-saving inventions and machinery. During the Industrial Revolution, business owners were creating large businesses that required formalized management practice.

3. What are the four major approaches to the study of management?

The four major approaches to the study of management are scientific, general administrative, quantitative, and organizational behavior. Each is correct and makes an important contribution to our overall understanding of management.

4. What relevance does scientific management have to current management practice? Inputs Transformation Outputs

Scientific management is the use of scientific methods to define the “one best way” for a job to be done. Its relevance to current management practice is that managers still use many of the techniques developed by Taylor, the Gilbreth, and other practitioners.

5. Describe Frederick W. Taylor’s contributions to scientific management?

Frederick Taylor defined four principles of management—develop a science for each element of an individual’s work; scientifically select, train, teach, and develop each worker; cooperate with workers to ensure that all work is done in accordance with the principles of science; and divide work and responsibility almost equally between management and workers.

6. Explain Frank and Lillian Gilbreth’s contributions to scientific management?

Frank and Lillian Gilbreth studied work arrangements to eliminate wasteful hand and body motions. They also experimented with the design and use of proper tools and equipment for optimizing work performance.

7. Describe Fayol’s principles of management and how they compare with Taylor’s?

Henri Fayol’s principles of management were division of work, authority, discipline, unity of command, unity of direction, subordination of individual interests, remuneration, centralization, scalar chain, order, equity, stability of tenure of personnel, initiative, and esprit de corps. In contrast to Taylor’s principles, Fayol’s focused on the entire organization and not just the individual worker.

8. What did Weber contribution to the general administrative theories of management?

Max Weber described an ideal type of organization called a bureaucracy, characterized by division of labor, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationships. Rules and controls were to be applied uniformly, avoiding involvement with individual personalities and preferences of employees.

9. Explain how the quantitative approach evolved and how it has contributed to the field of management.

The quantitative approach, also called operations research or management science, is the use of quantitative techniques to improve decision making, and it evolved out of the development of mathematical and statistical solutions to military problems during World War II. After the war, many quantitative techniques that had been used for military problems were applied to the business sector. The quantitative approach has added another dimension to the evolution of management practice and thinking and has contributed most directly to management decision making in planning and control.

10. What is organizational behavior?

Organizational behavior is the field of study concerned with the actions or behavior of people at work.

11. What were some of the contributions of the early advocates of OB?

Early advocates of the OB approach were Robert Owen, who proposed an idealized workplace where work hours would be regulated, child labor outlawed, public education and meals provided, and business involved in community projects; Hugo Munsterberg, who created the field of industrial psychology, the study of individuals at work to maximize their productivity and adjustment; Mary Parker Follett, who thought that organizations should be based on a group ethic rather than on individualism to release individual potential; and Chester Barnard, who saw organizations as social systems that required human cooperation.

12. Describe the Hawthorne studies and their contribution to management practice.

The Hawthorne studies, conducted at the Western Electric Company Works in Cicero Illinois, from 1924 through the early 1930s, exposed an experimental group of workers to various lighting intensities while providing a control group with constant intensity. As the level of light was increased in the experimental group, the output of both groups increased. The series of studies led to a new emphasis on the human behavior factor and helped change the dominant theme of the time that employees were not different from any other machines the organization used.

13. How is globalization affecting the way managers do their jobs?

Management is no longer constrained by national borders, and managers in organizations of all sizes and types around the world are faced with the opportunities and challenges of operating in a global market.

14. What is workforce diversity, and what implications does it have for managers?

Workforce diversity exists when workers are more heterogeneous in terms of gender, race, ethnicity, age, and other characteristics that reflect their differences. It’s an important issue because as more women, minorities, elderly, and immigrants enter the job market in the first part of the 21st century, monumental changes are predicted in the workplace.

15. Discuss the three important themes in the definition of entrepreneurship?

First, is the pursuit of opportunities, because entrepreneurship is about pursuing environmental trends and changes that no one else has seen or paid attention to. Second, is innovation, because entrepreneurship involves changing, revolutionizing, transforming, and introducing products or services or new ways of doing business. Third, is growth, because entrepreneurs are not content to stay small or to stay the same in size.

16. How is e-commerce different from e-business, and what are the main forms of e-commerce transactions?

E-business is more than e-commerce, although e-business can include e-commerce. E-business is a comprehensive term describing the way an organization does its work by using electronic linkages with its key constituencies. The main forms of e-commerce transactions are




and government-to-business .

17. Describe the three categories of e-business involvement.

The three main categories of e-business are:

enhanced—using the Internet to enhance but not replace traditional ways of doing business;

enabled—using the Internet to perform its traditional business functions better, but not to sell anything;

total—whole existence is made possible by and revolves around the Internet.

18. Why should managers be concerned about innovation and flexibility?

Without a constant flow of new ideas an organization is doomed to obsolescence or failure. Also, flexibility is required in a context where customers/needs may change overnight, where new competitors come and go quickly, and where employees and their skills are shifted as needed from project to project.

19. What is TQM, and how is it affecting manager’s jobs?

TQM is a philosophy of management driven by continual improvement and response to customer, employee, and supplier needs and expectations. It encompasses employees and suppliers as well as the people who purchase the organization’s goods or services. The objective of managers is to create an organization committed to continuous improvement in work processes.

20. How does knowledge management fit into the concept of a learning organization?

A learning organization is one that has developed the capacity to continuously learn, adapt, and change. Knowledge management involves cultivating a learning culture where organizational members systematically gather knowledge and share it with others in the organization in order to achieve better performance.

21. What is workplace spirituality and how is it an issue that managers must deal with?

  Workplace Spirituality

is “a recognition of an inner life that nourishes and is nourished by meaningful work that takes place in the context of community.” Workers, and society in general, are searching for a deeper understanding of who they are and why they’re here on Earth. They want more than just a steady job and a paycheck. Current research studies looking at the relationship between workplace spirituality and productivity have shown interesting results. Workplace spirituality is likely to be manifested in how managers treat employees and how employees’ contributions are respected and valued.

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