SYSTEM APPROACH

INTRODUCTION
The decisions taken by managers have wide ranging impacts. They affect the internal as well as external groups in a significance way. The decision to shift the location of a plant, to close a centre, to throw off workers, to promote employees on the basis of merit-whatever may be the case-creates a ripple of effect. So, when a manager takes a decision, he must understand and anticipation its repercussions on the entire organization and the environment.

 He must appreciate the fact that his organization is a totality of many inter-related, inter-dependent parts, put together for achieving certain objective.

THE CONCEPT
System theory is the big-picture approach that overcomes the common weakness of viewing things in too narrow a perspective. It attempts to view the organization as a single unified, purposeful entity, composed of interrelated parts. Rather than dealing separately with the various parts of an organization, the system theory gives managers a way of looking at an organization as a whole and as a part of the largest, external environment.

 In so doing, system theory tells us that the activity of an organization affects the activity of every other parts. The job of a manager is to ensure that all parts of the organization are coordinated internally so that goal can be achieved.

SYSTEM VOCABULARY
System Sub-system Synergy Open and closed system System boundary Flow Feedback

RELEVANCE AND USEFULNESS OF SYSTEM THEORY

System theory makes organization theorists search for integrative models rather than be satisfied with making lists of unrelated principles (Fayol, Taylor). It also emphasizes looking at the forest rather than trees. It uses a way of thinking that highlights underlying relationship. The practical implications of system theory for manager are enormous.

 Most effective managers operate with a system mentality even though they may not be consciously aware of it. As a matter of course, executive ask what effects what effects a decision will have on others. They think before they act, implying a process of evaluating the impact if their actions will have. A conscious commitment to system thinking require explicit responsibility for forming decisions in terms of the entire organization. Instead of merely looking at the technical side (scientific management) or activities side (administrative management) or even the human

side (human relations), executive are now forced to look at the totality of the situation and arrive at decisions. They can now easily maintain a good balance between the needs of the various parts of the enterprise and goals of the firm as a whole. They can respond, in short, to situational requirement in an effective way.

LIMITATIONS
It is true that systems theory, provides a broad philosophy perspective that bridge academic disciplines and mounts integrated attack on a variety of problem. It is objective and is not influenced by catch phrases like one best way and simplistic prescriptions like, a manager decides things for others. However, the conceptual framework for understanding organization provided by the systems theory, is too abstract. It does not attempts to identify situational differences and factors.

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