Systems Theory of Organizations
Summary
TLDRThe video script delves into the concept of viewing organizations as systems through General Systems Theory, introduced by von Bertalanffy and Miller. It contrasts this holistic approach with the classical management view, emphasizing efficiency and control. The script explains the system's components: inputs, processes, and outputs, and highlights open systems' interaction with their environment. It discusses the importance of feedback, goals, equifinality, and entropy, illustrating how systems naturally tend toward disorganization without maintenance. The summary concludes by noting systems theory's influence on other organizational theories.
Takeaways
- đ General Systems Theory was established by Ludwig von Bertalanffy and J.G. Miller in the 1960s and 1970s, offering an alternative perspective to the classical management view of organizations as machines.
- đ The Social Psychology of Organizations by Daniel Katz and Robert Kahn applied systems theory to understand organizational life, emphasizing a holistic approach over the classical efficiency and control focus.
- đ ïž Classical management sought the 'one best way' to perform tasks, in contrast to systems theory which encourages multiple ways to achieve organizational goals.
- đ Organizations are seen as open systems with inputs (resources and information), throughputs (activities within the system), and outputs (outcomes and services).
- đ An example of a system is a pizza place, which uses inputs like ingredients and labor, processes like making dough and taking orders, and produces outputs like pizzas and profits.
- đ Systems are open to their environment, exchanging resources and information, which is crucial for their health and adaptation to unpredictable external factors.
- đ Boundary spanners, or leaders, scan the environment to monitor external factors affecting the organization, such as competition and economic trends.
- 𧩠Holism is central to systems theory, viewing systems as a whole rather than a collection of separate parts, highlighting the interdependence and synergy within the system.
- đ Interdependence is key in systems theory, recognizing that changes in one part of the system can influence other parts, both directly and indirectly.
- đŻ Systems have goals, but these are contingent and negotiated, adapting as situations develop rather than following a predetermined single path.
- đ€ïž Equifinality in systems theory suggests that while there may not be one best way to organize, some ways are more effective than others, and the best approach can vary with context.
- đ Feedback is essential in systems, with negative feedback correcting deviations and positive feedback amplifying current processes, though it must be managed carefully to avoid unintended consequences.
- âïž Entropy is a fundamental concept in systems theory, indicating a natural tendency for systems to deteriorate without ongoing maintenance and balance.
- đ± Systems theory has paved the way for other theories such as complex adaptive systems, chaos theory, and learning organizations, providing a rich vocabulary and perspective on organizational dynamics.
Q & A
What is the General Systems Theory and who established its foundations?
-General Systems Theory is a framework for analyzing and understanding complex systems. It was established by Ludwig von Bertalanffy and J.G. Miller in the 1960s and 1970s.
How did the systems metaphor from biological organisms influence the study of organizations?
-The systems metaphor of living biological organisms was imported into Organizational Studies to provide a richer understanding of how organizations function as interconnected and interdependent systems rather than as individual components.
What was the main perspective of the classical management era in organizational studies?
-The classical management era viewed organizations as machines, focusing on efficiency, productivity, and control, and seeking the one best way to perform tasks within the organization.
How does the systems approach differ from the classical management perspective in terms of goals?
-The systems approach does not seek a single control mindset or the one right way to accomplish tasks. Instead, it aims to describe and explain how organizations work as a whole, pursuing multiple ways to achieve various goals.
What are the three main parts of an organization as described by the systems approach?
-The three main parts of an organization according to the systems approach are inputs (resources and information), processes or throughputs (activities within the system), and outputs (outcomes, products, and services).
Can you provide an example of how a pizza place operates as a system?
-A pizza place operates as a system with inputs like workers, food, and equipment; processes that include making dough, taking orders, and preparing pizzas; and outputs such as delivered pizzas, profit, and waste materials.
What does it mean for a system to be 'open' in systems theory?
-An 'open' system in systems theory refers to a system that interacts with its environment, allowing for the exchange of information and resources, which is essential for the system's health and proper functioning.
What is the role of leaders in scanning the environment of an organization?
-Leaders, acting as boundary spanners, scan the environment to monitor external factors such as vendors, customers, competition, and economic trends, which helps in making informed decisions for the organization.
How is the concept of holism important in the systems approach to organizations?
-Holism in the systems approach emphasizes viewing organizations as a whole rather than as separate pieces, recognizing that the system is greater than the sum of its parts due to the interdependent and interactive nature of its components.
What is the concept of equifinality in systems theory, and how does it relate to organizational goals?
-Equifinality in systems theory suggests that there is no single best way to organize, but also acknowledges that not all ways of organizing are equally effective. It implies that organizations should adapt and negotiate goals based on the specific situation at hand.
How do feedback mechanisms function in systems theory?
-Feedback mechanisms in systems theory involve negative feedback, which corrects deviations to reestablish the system's goals, and positive feedback, which can amplify and enhance the system's processes, though it must be managed to avoid unintended consequences.
What is entropy in the context of systems theory, and why is it significant?
-Entropy in systems theory refers to the natural tendency of systems to deteriorate and move toward disorganization over time. It signifies the need for continuous effort to maintain balance and prevent the system from running down.
How has systems theory contributed to the development of other organizational theories?
-Systems theory has served as a foundation for other theories such as complex adaptive systems, chaos theory, learning organizations, and loosely coupled systems, providing a comprehensive set of concepts and vocabulary for understanding organizations.
Outlines
đ Introduction to Systems Theory in Organizations
This paragraph introduces the concept of viewing organizations as systems, a perspective rooted in General Systems Theory established by Ludwig von Bertalanffy and J.G. Miller. It contrasts this with the classical management view of organizations as machines, which was focused on efficiency, productivity, and control. The systems approach emphasizes the whole organism, not just individual components, and seeks to understand how organizations work as a whole rather than imposing a control mindset. The paragraph also outlines the three main parts of an organization according to systems theory: inputs, processes (or throughputs), and outputs, using a pizza place as an example to illustrate these concepts.
đ Systems Theory Concepts: Openness, Holism, and Interdependence
This paragraph delves deeper into the principles of systems theory, highlighting the open nature of systems and their permeable boundaries with the environment. It discusses the importance of environmental scanning by leaders to make informed decisions. The concept of holism is introduced, emphasizing that systems should be viewed as a whole rather than a mere collection of parts, with the idea that the system is greater than the sum of its parts. Interdependence is another key concept, illustrating how changes in one part of the system can affect others, both directly and indirectly. The paragraph also touches on the idea of systems having contingent and negotiated goals, and introduces the concept of equifinality, which suggests that there is no single best way to organize but acknowledges that some ways may be more effective than others.
đ Feedback, Entropy, and the Evolution of Systems Theory
The final paragraph explores the role of feedback within systems, distinguishing between negative feedback, which corrects deviations to maintain stability, and positive feedback, which can amplify processes but also needs to be managed to avoid negative consequences. It introduces the concept of entropy, which refers to the natural tendency of systems to deteriorate over time, and the importance of maintaining balance through homeostasis or equilibrium. The paragraph concludes by discussing how systems theory has served as a foundation for more specific theories such as complex adaptive systems and chaos theory, and has influenced other organizational concepts like learning organizations and loosely coupled systems.
Mindmap
Keywords
đĄGeneral Systems Theory
đĄOrganizational Studies
đĄSystems Metaphor
đĄClassical Management
đĄInputs
đĄProcesses or Throughputs
đĄOutputs
đĄOpen Systems
đĄHolism
đĄFeedback
đĄEquifinality
đĄEntropy
Highlights
General Systems Theory was established by Ludwig von Bertalanffy and J.G. Miller in the 1960s and 1970s.
Organizational Studies researchers applied the systems metaphor of living biological organisms to understand how organizations work.
Daniel Katz and Robert Kahn's 1966 publication, 'The Social Psychology of Organizations,' applied systems theory concepts to organizational life.
The systems approach provides an alternative perspective to the classical management view, focusing on the whole organism rather than individual parts.
Classical management aimed for efficiency, productivity, and control, searching for the 'one best way' to perform tasks.
Systems theory describes and explains how organizations work without a control mindset, pursuing multiple ways to achieve goals.
Organizations are viewed as open systems with permeable boundaries, constantly exchanging information and resources with their environment.
Key components of organizational systems include inputs (resources and information), processes (activities within the system), and outputs (outcomes and products).
Holism is central to systems theory, viewing systems as greater than the sum of their parts, with interconnected and interdependent elements.
Feedback processes in systems theory include negative feedback (correcting deviations) and positive feedback (amplifying desired processes).
Entropy in systems refers to the natural tendency of systems to deteriorate and move toward disorganization, requiring constant maintenance to achieve balance.
Equifinality in systems theory suggests there is no single best way to organize, though some ways are more effective than others depending on the context.
Systems theory laid the groundwork for more specific theories like complex adaptive systems, chaos theory, and learning organizations.
Karl Weick's research on loosely coupled systems is a direct extension of the systems view on organizations.
Systems theory provides a counterpoint to classical management, offering a comprehensive vocabulary and conceptual framework for understanding organizations.
Transcripts
- [Narrator] Today we're gonna look
at how we can see organizations as systems.
Ludwig von Bertalanffy and J.G. Miller
established the foundations
of General Systems Theory
in the 1960s and 1970s.
And researchers in the Organizational Studies area
imported the systems metaphor
of the living biological organism
and the key terms that go along with it
to pursue a richer understanding
of how organizations worked.
In 1966, for example, Daniel Katz
and Robert Kahn published
The Social Psychology of Organizations
that applied systems theory's concepts
to organizational life.
I think it's most helpful to see systems
as an alternative perspective at the time.
Classical management era of organizational studies
was really the dominant view
and it saw organizations as machines
and that was the main way to view
life in organizations for many decades.
The goal of that classical management
school of thought was they wanted efficiency,
productivity and control.
They were looking for the one right way
or, as Frederick Taylor said,
the one best way to do every single task
in the organization.
And so when systems theory came along
it was really a whole another way
to view life at work.
A systems approach looks at the whole organism,
not the little pieces of the machine,
but how it all fits together as a whole.
So, the goal of the systems approach
is to describe and explain
how organizations work.
They don't have a control mindset.
And they wanted to pursue multiple ways
to accomplish the various goals of the organization.
They're not looking for the one right way.
So I think it's best to understand
this systems approach as a counterpoint,
or an alternative, or even a reaction
against the classical management era
and school of thought.
So, in an organization we have
three main parts.
We have a set of inputs
where we have resources, information
that is needed to supply
the organizational system.
We also have the processes or throughputs.
That's all the activity within the system
that we need to do to accomplish work.
And then we have the outputs.
Those are the outcomes, the products,
the services created or delivered
by the organization.
Typical pizza place, for example,
has inputs that you might expect.
The people that are doing the work,
the food, the ovens, refrigerator, pizza boxes,
and all the other materials.
And then you have your processes,
or throughputs, where you make the dough,
you cut the vegetables, mix the sauce,
answer the phones, take the orders,
make the pizza, delegate the tasks.
Lots of work in a pizza place!
And then you have outputs
which are hopefully pizza
delivered to happy customers.
You have a profit for the shop.
Hopefully, your employees
are getting good paychecks.
You put the trash in the dumpster,
and all the other kinds of waste material.
Those are also considered outputs of a system.
And those are the three main parts.
So systems here are clearly open.
That's one of the main concepts
in systems theory.
They're open to their environment.
When we say environment,
we don't just mean things like the weather.
Of course we're not excluding that weather
but the environment more broadly.
So you have permeable boundaries
where information comes in and out,
resources flow both in and out
of those boundaries and around the organization.
And you have an exchange with the environment
that's not just happening but it's essential
for the health of the system.
So, constantly things are coming in
and moving out of the system
to keep it healthy,
to keep it functioning properly.
And your environments that you're in
are very unpredictable.
You can't say for certain
exactly what's gonna happen with competitors,
and exactly what's gonna happen in the future.
So you have the leaders
that are scanning the environment,
they're called boundary spanners.
And they're looking at the environment
to see what the vendors are up to,
what the customers are looking to do,
what the competition is up to,
where the general economy is headed.
And they're keeping an eye
through an environmental scanning
on all of the things that are happening
in and around the organization
to make better decisions.
Holism is an important part
of the systems approach
where systems are viewed as a whole,
not simply as a collection of separate pieces.
So, you wouldn't view yourself,
your whole body as just a collection of cells,
you're much more than that.
Another way to say it is a system
is greater than the sum of its parts.
Some people use the term synergy here,
which has a bad rep in some circles.
Those parts of the system are interdependent
and they interact through mutual feedback processes.
So, feedback is a dynamic process
where the pieces of the system,
of that whole are all interconnected.
Interdependence is another leading concept
in the systems approach
where organizations are in a dynamic
and interconnected relationship
with their environment.
For example, there're sub-parts within the system
that are also interrelated,
they're not isolated.
The organization is not simply isolated
and plopped down in the community,
it's connected to that community
and the pieces, the parts
within that organization
are also interconnected.
They're made up of interconnected sub-systems.
So, you have a whole organization
and then you have, let's say,
some major departments within that organization,
and then within those departments you have
work teams that are also interrelated
and overlapping.
So, changes to one part of the system
directly or indirectly influence other parts.
For example, if you had some people
call in sick on one team,
then other people in the organization
would be at least indirectly affected
and have to maybe pick up some of that work.
Maybe you hire a whole bunch of people
in one part of the organization
and everybody is gonna have to get on board
and train them and adapt when you add people.
So, everything is interconnected.
All the parts either directly or indirectly
influence the other parts.
Systems also have goals but the goals, again,
are not like classical management goals
of finding the one best way.
Goals are contingent and negotiated.
That means it depends on what exactly
the organization is facing
and where it's going.
It'll have to adapt along the way
as the situation develops.
Equifinality is a powerful concept to describe
how systems people approach goals.
the first part of equifinality
is it is no one best way to organize,
and this, again, flies directly in the face
of people like Frederick Taylor
who are looking for the one best way.
The second part of equifinality, however,
makes the concept that much more powerful,
that all ways of organizing
are not equally effective.
So, what they're not saying is look,
there's no one best way
so let's throw it all out.
What they're saying is there may be
not one single way to do everything.
However, there are some ways
that are better than others.
You just can't always know ahead of time
as you pursue your goals
what those several good ways are.
However, for example, if you want to travel
from New York City on a road trip to Los Angeles,
you cannot find one route at all times
that's the one best way
depending on weather, time of year,
traffic patterns, road conditions.
You will have to look for a variety of ways
to get there in that specific case.
However, they're not all the same.
For example, if your travel companion,
your co-pilot says,
"Let's go from New York City
"to Los Angeles on a road trip,
"but let's go all the way up
"through Canada first,"
you're probably gonna say
"That's not one of the better ways
"to do things."
Feedback is also an important part
of the systems approach.
We have negative feedback that seeks
to correct or reduce deviations
in the system's processes to reestablish
a steady course back in the direction
of the system's goals.
That's negative feedback that corrects.
Then you have positive feedback
that changes or grows the system
in desired ways that amplify
and enhance the system's current processes.
So you have positive feedback
that gets you going in the direction
you want to go faster.
However, if you think about it,
just like with kids, you can't reward
the wrong kinds of behavior accidentally.
So, positive feedback in this sense
is not necessarily always good for a system.
You might have a boss that's screaming
and yelling at everybody.
And if that boss get a promotion,
that might be seen as positive feedback
that would then amplify that boss's approach
and maybe the people around that boss
would start to scream and yell
at everybody too 'cause they're seeing
that that's what's being rewarded.
And then eventually, people would have
to give some negative feedback,
say "Hey, let's tone that down.
"We don't want to be like that,"
to get the system back on track.
Entropy is a term that is central
to the way systems work.
It's one that, I think, adds a lot of depth
to this approach, and that is systems tend
to run down, they tend to deteriorate,
and move toward disorganization.
So left on their own,
systems will run down.
For example, if you just left your apartment
and didn't clean it,
and you're still living in it
but you left it on its own
and didn't do the dishes and pickup,
it would only take a day or two
before it looked like a completely
rundown deteriorated system.
And that's why we seek more balance.
There's energy, resources, information
coming into the system to help it reach
homeostasis, or equilibrium.
Those are both ways to say balance.
So you have a whole lot of effort and work
and time put into maintaining
a balance in the system
so it doesn't on its own run down.
And the same way if you stopped
showering your body as a system,
you stopped bathing, brushing your teeth,
you would start to be noticed by your friends.
They would say, "Wow, you're not maintaining.
"You have to do that, otherwise you're gonna
"continue to deteriorate and fall apart."
Systems theory has not necessarily been used
in a lot of very specific ways as it is.
It was more like an opening.
An open door to lead up to a whole other set
of precise theories to look at organizations.
So, for example, complex adaptive systems,
or chaos theory as it's something called,
was built upon the foundation
of systems theory.
Learning organizations is another school of thought
that came out of systems thinking.
And of course Karl Weick's research
on loosely couple systems
is a directly outshoot
of the systems point of view on organizations.
So systems theory has provided
a powerful set of concepts
and a vocabulary and a whole way
of thinking about organizations
that is a direct counterpoint
to the classical management era
school of thought.
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