Integrating Perspectives

System Perspective (Theory)

Ludwig Von Bertalanffy, Kenneth Boulding, NIE Weiner, Fremont E. Kast, and James E. Rosenzweig all contributed to the popularization of system theory. A recent idea in the management literature is system theory. A system is made up of a number of interrelated and dependent pieces that are arranged to generate a cohesive whole. A system is an organic whole rather than just a collection of components. The system is made up of a few subsystems, all of which are connected to one another. It is the combination of items or elements into a complicated whole. One segment's activity has an impact on another segment's activity. There are four different types of organizational subsystems: social, mechanical, biological, and physical. The input, processing, and output components, as shown in the diagram, can be used to study system theory the best.

• Input
  • The outside world provides input to an organization. Human, financial, physical, and informational input are all included. For an organization to succeed, it needs qualified and experienced staff, a decent physical infrastructure, and enough funding.
• Processing
  • Processing units are organizations. The process of conversion turns raw ingredients into final goods. Processing requires solid planning, wise decision-making, capable leadership, and effective control.
• Output
  • The end result of the organizations is their output. The purpose of organizations is to create commodities or services. Market outputs are offered, and comments or other feedback are obtained. The customer will have a favorable opinion of the business if it can deliver high-quality goods, and the opposite is also true. Businesses with efficient input and processing will produce better goods and services.

Ludwig Von Bertalanffy identified two primary categories of systems:

• Closed system
• Open system

• Closed System
  • Closed systems are not affected by or in communication with their surroundings. They are primarily mechanical in nature and must carry out specified tasks regardless of the circumstances. A closed system is something like a clock.
• Open System
  • Open systems are always interacting with their surroundings. Every organization engages in environmental interactions. It is concerned with converting inputs into beneficial outputs that the environment needs.

Elements or Features of System Theory

The following are the main components or traits of system theory:

• Goal Orientation
  • Every system has a goal. It is geared toward reaching specific goals.
• Subsystem
  • Subsystems are the collective term for a system's parts or constituents. Each system may be a component of another system, which is a more comprehensive whole. They communicate with one another.
• Synergy
  • The term "synergy" refers to when the total is more than the sum of its parts. Due to the synergic effect, 2 + 2 Equals 5. It indicates that rather than how well each part performs, the effectiveness of the whole depends on how well its parts are connected.
• System Boundary
  • Every system has a border dividing it from its surroundings. Which components are internal to the organization and which are external are determined by the boundary. The system border is flexible in open systems whereas it is rigid in closed systems. Many organizations have flexible system boundary.
• Flow
  • Materials, information, funds, people, and other resources flow via systems. These act as inputs into the system, go through a transformation process, and produce outputs in the form of goods or services.
• Feedback
  • Feedback is the term for the response to the environment. It aids in assessing and enhancing the system's performance. Feedback is therefore essential for system control.
• Open or Closed System
  • There are two types of systems. A closed system is confined and insulated from its environment, whereas an open system frequently interacts with its environment.

Contributions of System Theory

The following are the important contributions of system theory:

• It offers a conceptual framework for a fruitful analysis of organizational management.
• It instructs managers to place the appropriate emphasis on the interdependence and relationships between different components or pieces of the organization as well as between the organization and its environment.
• It exhorts managers to investigate and grasp every part of a problem in connection to other elements.
• By emphasizing the physical aspects, behavioral factors, and environmental considerations, it attempts to combine multiple management ideas.

Limitations of System Theory

The following are the main drawbacks of system theory:

• It is too abstract to be immediately and effectively applied to real-world issues.
• It does not provide any integration tools or approaches, and the mutualism between organizations and the environment is not addressed.
• It doesn't provide a comprehensive body of knowledge.

Contingency Perspective (Theory)

Situational or practical approach to management are some names for this idea. It is a recent theory among management academics that is connected to the system approach. It was created by working managers, consultants, and researchers who tried to put the idea behind earlier management theories into action. Popular names among them included Jame Thomson, John Woodard, Tom Burns, Jay Lorsch, Paul Lawerence, and Jay Lorsch. This strategy is predicated on the idea that there probably isn't a single ideal technique to address management issues across all firms.

This method holds that the optimal way to lead, plan, organize, and conduct managerial activities depends on the circumstance. A specific strategy that works for one organization at a time might not always work for another organization later on. Therefore, there aren't any strategies, organizational structures, or methods of control that will work in every circumstance. There are notable differences between the two situations. Every organization has a specific identity, thus management choices and organizational structures must be special. The manager must comprehend the particulars and complexities of every circumstance. The situation and the method of coping should be compatible.

Management strategy is determined by four contingency factors.

• Organization Size
  • The size of an organization has a significant impact on the actions taken by managers.
• Routineness of Task-Technology
  • Technology is used by organizations to convert inputs into outputs. Contrary to what non-routine technologies require, routine technologies demand different organizational layouts, leadership philosophies, and control mechanisms.
• Environmental Uncertainty
  • The management process is influenced by the level of unreliability brought on by political, technological, sociocultural, and economic change. In a rapidly changing and unpredictable setting, the style that works best in a stable environment could be completely wrong.
• Individual Differences
  • Individuals differ in terms of their expectations, tolerance for ambiguity, autonomy, and independence. When managers choose motivational strategies, leadership philosophies, and work designs, these and other personality distinctions are particularly important.

Therefore, management cannot have ready-made ideas that can be used in every circumstance and be accepted as eternal truth. Management will need to pinpoint the fundamental characteristics of technology, the differences among participants who are people, and the wide range of environmental relationships. Every managerial decision will be based on specific current conditions and contextual variables. It appeals to the mind because of its logical theme. The universalistic aspect of management ideas is rejected by this method. The contingency viewpoint, however, can be said to be more than just a question of common sense. It necessitates that managers have a comprehensive awareness of the problem and available solutions.

Features of Contingency Theory

The following is a list of contingency theory's characteristics:

• Organizations are open systems that frequently engage with their surroundings.
• It is an integrative strategy in that it makes an effort to incorporate different managerial perspectives.
• It can be used in intellectual exchanges where habits and customs cannot be assumed.
• For it to function most effectively, understanding of numerous circumstances and instruments is required.
• It is founded on empirical study and based its development of its instruments on actual discoveries in various circumstances.

Contributions of Contingency Theory

The following is a list of the important contributions of contingency theory:

• Managers receive assistance in developing fresh, improved strategies to handle challenging situations.
• It enables individuals to think critically, analytically, and from a variety of angles.
• More freedom is granted to managers.
• Managers develop greater sensitivity and awareness.

Limitations of Contingency Theory

• It disregards the rules that apply to everyone.
• It does not include all potential contingency factors.
• It concentrates on the situation alone, but it doesn't specify which instruments should be utilized in particular circumstances.
• Aspects of human behavior are disregarded.

Reference

(Shrestha, P. (2014), Principles of Management. Kathmandu: Samjhana Publication Pvt. Ltd.)