Wednesday, October 6, 2010


System Theory of Management.
  1. A system is a group of interrelated and interdependent part working towards a common goals. It is combination of several parts forming a complete whole. This theory takes management as a system. Management is a system which works under certain rules and regulations. In system human resources, capitals, raw materials, technological knowledge, skills and information are used. Communication is changed into goods, services through transformation process. It gives equal importance to all the elements including men. Management system is made of different sub-system such as production, marketing, research and development sub-system etc. As a result management system gets dynamism and strength due to which organizational goals become possible to achieve. System can be divided into two kinds as follows
  • Closed system- Organizational system that doesn't interact with its environment.
  • Open system- Organizational system that interacts with its environment.
All the elements become equally important in management system. All the elements do works regularly in order. If one element lacks, the whole system is adversely affected. So the system can be compared with human body.
Main features of system theory are as follows.
  • System theory accepts management as an input process output system,
  • Different sub-systems lie in one system,
  • All the sub-system are linked with one another,
  • It becomes useful to study the complex problems and find proper solution,
  • It is goal oriented to have existence in its main goals,
  • It studies interrelationship of different organs in a system,
  • This theory identifies environmental influences,
  • It takes an organization as an integrated forms and
  • It recognizes all the sub-system and close interaction.


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