A system is a set of arrangements of things so related or connected as to form a unity or organic whole. A concept that refers to both a complex of inter-dependencies between part, component, processes that involves discernible regularity of relationships.

A system receives input from environment and sends output to environment after transformation process. System also adjusts itself by feedback. Thus there is a balance between system and environment.

Administrative management , scientific management , Weber's theories are closed systems where no interaction is seen between administrative system and environment. Behavioral, human relations school approaches are open systems. Open systems move towards greater internal differentiation, specialization, higher levels of organization whereas closed systems move towards disorder.

Organization as a system:
  1. Technical subsystem: convert input to output.
  2. Supportive subsystem: organizational activities.
  3. Maintenance subsystem: necessary input of human skill
  4. Adaptive subsystem: Helps organization respond to environment changes like planning units.
  5. Psycho-social subsystem: interpersonal relations.
  6. Structural subsystem: formal relations in an organization.
  7. Management subsystem: Integrates different subsystems together to regulate internal - external relations.
These 7 sub systems interact with the socio-cultural, political, technological, economic subsystem.

Classical Approach Systems Approach
Views an organization as a closed system views an organization as a open system
views organization as non adaptive, non ecological adaptive, ecological
assumes Theory X Theory Y
considers formal dimension of organization all dimensions
rigid , hierarchical structure flexible, participative
economic incentive multi faceted incentives
normative or prescriptive descriptive or analytical

Closed systems Open systems
bureaucratic, hierarchical, formal, rational, mechanistic collegial, competitive, free market, informal, natural and organic
routine tasks non routine
division of labor specialised knowledge contributes to many tasks
proper way of doing job is emphasized getting job done is emphasized
conflict is adjudicated from top by peers
everyone has a specific job description all contribute to all jobs
responsibility and loyalty is to an organization sub unit to entire organization
pyramidal structure Fluidic and network structure
interaction is downward bidirectional
Prestige is internalised by rank and position Prestige is externalised by professional ability and reputation.

Critical Evaluation:

  1. Abstract, over conceptual , vague to study organizations.
  2. Lack of direct applications to practical studies.
  3. Approach doesn't offer any tools to analysize organizations.
  4. Neither recognizes differences in systems nor specifies nature of interaction or inter dependencies.
  5. Facilitated contingency management
  6. Environment approach was followed by ecological approach.
  7. Integrated and synthesized the classical, Neo classical and modern concepts associated with organization thought.