CASE STUDY

Case Study

Case Study

Using Systems Theory, Identify the systems that are evident in the case study and explain how they inter-relate to each other and why integration of management effort is essential.

Systems Theory is based upon the analytic division of the natural world into environment and systems (Rosenthal & Gilliam 2003: 19). This division constitutes the major foundational, axiomatic philosophical assumption of Systems Theory, ability of a system to maintain itself with no loss of function for extended periods of time. In human terms it is the creative and responsible stewardship of resources — human, Management natural, and financial (Vapnik 1995:21) to generate stakeholder value while contributing to the well-being of current and future generations of all beings. On the one hand there is an infinitely complex 'environment', and on the other hand there are self-replicating systems. Systems are engaged in processing information. Systems also model the environment, and can respond adaptively to environmental changes(Rosenthal & Gilliam 2003: 12).

Not all management occurs in the form of an organisational system after all, management may be a single human individual. Nor is the system of management deducible from the payroll of people employed as 'managers'(Drucker 2007:202). Indeed, the first task of any analysis based upon Systems Theory is to define the system under consideration, and to establish its operational boundaries. Systems are based upon the binary division of the world into system and environment. Management systems are no exception - the system samples information from its environment, including the organisation it manages. Only this sampled information is subject to processing. For instance, management may sample salaries and working patterns of its employees - this represents information that the system exchanges with its environment(Rosenthal & Gilliam 2003: 15). This communication relating to salaries and working is then encoded into the relatively more precise and concise form of the management language perhaps as numerical summaries. Internal-processing then commences for example this information may be used to generate statistical analyses to examine the relationship between pay and performance, these statistics may be compared with those of competitors and national norms, and models generated to predict the effect of possible changes to rewards and conditions(Drucker 2007:251)..

This information may also be set in a context of other predicted financial constraints such as expected turnover, profits and market share. Finally, decisions will be made on the basis of this information, and these will be communicated to the organisation. The results of these communications will then be monitored. The purpose of the above illustration is to emphasise that the more complex a management system, the greater will be the amount of internal processing compared with the amount of information exchanged with the environment. The management system is defined as the pathway and processing of the sampled information. It can be seen that the management system may include human brains and bodies, but also the outputs of machines (such as clocks, camera and typewriters); and that processing may include non-human cognitive activity such as computers which perform statistical analyses(Rosenthal ...