Organizations as Open Systems

Summary

This video discusses the systems perspective, which was initially developed in the physical sciences and later applied to areas like management and organizational behavior. It explains how organizations function as systems, receiving four types of inputs—material, human, financial, and informational—from the environment. Managers transform these inputs into outputs like products, services, employee behaviors, and profits, which are then fed back into the environment. The video emphasizes the value of the systems perspective for managers, helping them understand how various organizational elements interact to produce desired outcomes.

Takeaways

• 😀 The systems perspective was first developed in the physical sciences but has been expanded to areas like management and organizational behavior.
• 😀 A system is defined as an interrelated set of elements that function as a whole.
• 😀 Organizations can be viewed as systems that receive four types of inputs: material, human, financial, and informational.
• 😀 Managers combine and transform these inputs to create outputs like products, services, employee behaviors, profits, and losses.
• 😀 Outputs are returned to the environment and include products sold to consumers, profits, and additional information about the organization.
• 😀 Profits from operations are fed back into the environment through taxes, investments, and dividends.
• 😀 Losses, when they occur, impact the environment by reducing stockholders' incomes.
• 😀 Feedback from the environment is essential for assessing the effectiveness of outputs.
• 😀 Information about the company and its operations is also released back into the environment.
• 😀 The systems perspective helps managers understand how various organizational elements interact to transform inputs into outputs.

Q & A

What is a system in the context of organizational behavior?

A system is an interrelated set of elements that function as a whole. In organizational behavior, it refers to the components of an organization working together to achieve common goals.

What are the four types of inputs that an organization receives from its environment?

The four types of inputs an organization receives from its environment are material, human, financial, and informational.

How do managers utilize the inputs they receive?

Managers combine and transform these inputs into outputs, which are then returned to the environment in the form of products, services, employee behaviors, profits, losses, and additional information.

What types of outputs are generated by an organization?

The outputs include products or services, employee behaviors, profits and losses, and additional information about the organization.

How do profits and losses impact the environment?

Profits are fed back into the environment through taxes, investments, and dividends, while losses reduce stockholders' incomes, which also affects the environment.

What is feedback in the context of a system's perspective?

Feedback refers to the response from the environment regarding the outputs of the organization. This feedback helps influence future inputs and actions within the system.

Why is information about the company important in the systems perspective?

Information about the company and its operations is released into the environment as part of the outputs, and it helps to inform future decisions and responses from the environment.

How does the environment respond to the outputs of an organization?

The environment responds to the outputs by influencing future inputs, shaping the way organizations receive resources and information moving forward.

Why is the systems perspective valuable to managers?

The systems perspective helps managers conceptualize how various elements of the organization interact and flow together to transform inputs into outputs, making it easier to understand and manage complex processes.

How does the systems perspective contribute to organizational efficiency?

By viewing the organization as an interconnected system, the systems perspective allows managers to optimize processes, ensuring that inputs are effectively transformed into valuable outputs and minimizing inefficiencies.