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Lecture 1: Definition of Systems

Objectives of lecture:

• Define a system

• Know main features of Systems Approach

• Open and closed systems

• Understand the importance of the environment

• Deterministics, probabilistic, and self-organising systems

1. What is a system?

• A system is a group of elements organized with a purpose – a group of interrelated

interworking objects

• Systems can be either probabilistic or deterministic or self-organising in nature

• Systems have often multiple goals

• Systems can comprise of subsystems

• Open systems have interfaces and interact with other systems

2. Classification of Systems

Various systems are classified as:

o Conceptual and Empirical systems

Conceptual systems (a.k.a Abstract systems) are theoretical and explanatory in nature.

They usually represent theoretical structures (or models) that provide the much needed

clarification about the workings of an observed phenomenon or concept. They provide

the theoretical framework for which there may or may not have any counterpart in the

real world. They are usually made up of non-physical objects. Examples of such systems

include philosophy (e.g. love, patriotism...etc), theology (e.g. creation of the world),

political system (e.g. democracy, communism...etc), economic theory, organizational

theory, general system of theory.

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Empirical systems are very concrete, practical, specific operational systems made up of

people, materials, machines, energy, and other physical things. It can be based on the

conceptual system.Examples of empirical systems are examination system, surgery...etc.

o Natural systems exist and also abound in the nature.They are also not at all the results

of the human endeavours. Rivers, mountains, minerals, the human body, solar

systems...etc., are major examples of the natural systems.

o Man-made (or Artificial) systems are those that are manufactured. Examples of such

systems are dams, canals, roads, machines, factories, transportation systems (bus,

train...etc), communication system, education system, business organisation...etc.

o Social systems are made up of people. Examples of social systems are business

organization, government agencies, political parties, social clubs, professional societies,

virtual worlds, role-playing games, social networks (Facebook, Myspace...etc).

o Man-Machine systems are systems consisting of a human operator or group of

operators, and a machine, by means of which the operator performs a task. Both the

human and the machine perform some kind of activity in the accomplishment of a goal.

Examples of such systems are:

o An aeroplane, a bus, a ship...etc

o Processing of data using computers

3. Types of Systems

3.1 Closed Systems & Open Systems

A closed system is one that is isolated from its environment. It shuns any kind of the exchange

with the environment. It is self-contained so that the external environment does not influence the

behaviour of the system, nor does its influence its immediate environment. As a result, a closed

system is rigid in nature, has a well-defined boundary, and is not at all adaptive in nature. Closed

systems exist in concept only.

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An open system is a system which interacts continuously with its environment. It receives inputs

and influences from the environment and in turn passes back outputs, feedbacks and influences

to the environment. Organisations are open systems. An information system is another example

of an open system.

3.2 Simple & Complex Systems

• Simple systems

– possible to define system outputs from known inputs

– Does not require high-level system analysis and review

– For example, a chair, with no moving parts

• A Complex System

– Multitude of parts and relationships

– involves a number of elements, arranged in structure(s) which can exist on many

scales

– go through processes of change that are not describable by a single rule nor are

reducible to only one level of explanation, these levels often include features whose

emergence cannot be predicted from their current specifications. E.g.: Genetic

Algorithms, Neural Networks-learn by example, AI-based machines and programs.

– Requires high system analysis and review

3.3 Stable vs. dynamic

• Dynamic systems:

– Fluctuate rapidly; constantly changing

– Such systems have the capacity of ‘remembering’ what it had been subjected to

previously, or has some memory built into it.

– Described by dynamic equations or differential equations of appropriate type.

– Boundaries can be difficult to identify when systems are very dynamic

– E.g. the human body system, the weather system...

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• Stable/ Static Systems:

– In equilibrium (steady state) with no significant changes taking place.

– Described in simple mathematical terms by a set of algebraic equations

3.4 Deterministic vs. Stochastic

• Deterministic:

o Are predictable in every detail

o In such systems, the interaction of the elements is known

o As the behaviour of the elements is pre-determined, it becomes possible to work

upon the reaction well in the advance

o In these systems, the output can be predicted with 100% certainty

o No randomness is involved

o E.g. pseudorandom number generator (uses a deterministic algorithm)

• Stochastic:

o Behaviour is affected by random inputs

o In such a system, the behaviour is non-deterministic

o There’s a element of unpredictability and randomness associated with it

o It does not always produce the same output (or effect) for a given input

o Examples are financial markets (random behaviour of assets such as stocks,

commodities, currency prices, interest rates...etc)

o Other examples are creativity, medicine intake (cannot determine the extent of its

efficacy)

4. Systems Approach

4.1 What is the Systems Approach?

It is a method or framework which helps us to analyse and explore the operation and interactions

which exist in the systems around us. According to the Open University, a system is an assembly

of parts where:

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• The parts or components are connected together in an organised way

• The parts or components are affected by being in the system

• The assembly does something.

• The assembly has been identified by a person as being of special interest

Examples: Railway system, Hospital, Accounting system, Information system, Political system

4.2 Features of the Systems Approach

• All systems are composed of inter-related parts or sub-systems

• The system can only be explained as a whole

• Systems are hierarchical in that the parts of sub-systems are made up of other smaller

parts

• Parts of a system cannot be altered without affecting other parts

• Sub-systems should work towards the goal of their higher systems and not pursue their

own objectives independently

• Organizational systems contain both hard and soft properties

5. Systems Elements

Three key features of systems are

• The transformation process

• Boundaries

• Environment

5.1 Transformation Process:

The Transformation process consists of three parts:

Input => Process => Outputs

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Input stability

< Input – Process – Output > is what you put in, what you use both input and output for, and

what you get out. For example:

Input : you might put in your monthly expenditure and income

Process : then you can work out your average

Output : finally create a graph

5.2 Systems Boundaries

The features which define the extent of a system are its boundaries (limits). Within

organizations, boundaries are determined by management and vary from organizations. For e.g.:

invoicing within the boundary of the Accounting dept.

5.3 The Environment of Systems

Organisational Environment

• All organisations exist in and relate to environments that affect their operations.

• The environments in which administrators and policy

countries are both distinctive and diverse.

• The organisational environment is a vital element in influencing the nature of policy,

administrative reform or any programme of planned change.

• For organisations to remain effective and efficient they must take steps to ‘fit’ their

structures and strategies to the demands of the environment (Emery and Trist, 1965;

Lawrence and Lorsch, 1967).

The Environment of Systems

ations exist in and relate to environments that affect their operations.

The environments in which administrators and policy-makers operate in developing

both distinctive and diverse.

ational environment is a vital element in influencing the nature of policy,

administrative reform or any programme of planned change.

ations to remain effective and efficient they must take steps to ‘fit’ their

structures and strategies to the demands of the environment (Emery and Trist, 1965;

Lawrence and Lorsch, 1967).

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ations exist in and relate to environments that affect their operations.

makers operate in developing

ational environment is a vital element in influencing the nature of policy,

ations to remain effective and efficient they must take steps to ‘fit’ their

structures and strategies to the demands of the environment (Emery and Trist, 1965;

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6. Systems and Adaptability

6.1 Change

Change occurs as organisations seek to adapt to their environment by incorporating ideas about

the proper way to go about things – ‘logics of appropriateness’ – in order to win external

legitimacy. Change is an alteration of an organization’s environment, structure, technology, or

people.

6.2 Types of Change:

• By exception (to an existing belief system)

• Incremental (In stages over a period of time)

• Pendulum (So pronounced and different that they result in extremities)

• Paradigms (Fundamental rethinking of premises, assumptions, beliefs and values)

• Planned (Timely, goal-oriented, intentional, proactive, purposeful)

• Unplanned (Quick reaction to demand from internal/ external forces)

6.3 Forces for Change:

• External Forces

– Marketplace competition

– Government laws and regulations

– New technologies

– Labour market shifts

– Cycles in the economy

– Social change

• Internal Forces

– Strategy modifications

– New equipment

– New processes

– Workforce composition

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– Restructured jobs

– Compensation and benefits

– Labour surpluses and shortages

– Employee attitudes

6.4 Characteristics of Change-Capable Organisations

• Link the present and the future (i.e. have a well-defined vision)

• Make learning a way of life

• Actively support and encourage day-to-day improvements and changes

• Ensure diverse teams

• Encourage maverick (rebels)

• Shelter breakthroughs

• Integrate technology

• Build and deepen trust

Organisations must be flexible and adapt to change. Successful organisations characterized by

their internal openness and their readiness to accept that yesterday’s methods and products are

very unlikely to be suitable for tomorrow.

Adaptation only occurs as a result of management decisions and action.

7. Shared and Overlapping Sub-Systems

Sub-systems can belong to more than one system and there is a need to recognise this overlap

and to design operations and processes accordingly. E.g.: A is a subset of B.

7.1 Interconnections

Each sub-system has many inputs and outputs. Many interconnections may exist within the same

system.

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7.2 Decoupling

Decoupling is a way to loosen the connection of sub-systems so that the two systems can operate

with a degree of independence in planning and control. Example: Japanese way of Just-In-Time.

Two major costs are involved with decoupling:

• The cost of the decoupling mechanism itself. For e.g. the costs of carrying stocks, cost of

the slack capacity…

• The possibility that the sub-systems may act in their own interests and not that of the

organisation as a whole.

8. Deterministic / Probabilistic / Self-Organising Systems

8.1 Deterministic Systems

• They are predictable where output is predictable

8.2 Probabilistic or Stochastic Systems

• These are where conditions of the system can be predicted from the previous state but

only in terms of probable behaviour and there is always a certain degree of error attached

to the prediction of what the system will do.

• For e.g.: inventory control system – average demand or average stock may be predicted,

but exact value cannot be predicted.

8.3 Self-Organising System

• Self-organising systems are those which adapt and react to inputs or stimuli. Method of

adaptation is uncertain and same inputs do not always produce same responses.

9. Socio-Technical Systems

• Developed by Trist and Tavistock Institute

• The view is that any production system requires both:

o a technological organisation (equipment, processes, methods etc…) and

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o work organisation (those who carry out the necessary tasks to each other)

• The technologies involved determine the technical subsystems and vary widely (skills,

procedures, machinery, equipment and layout facilities)

10. System Performance and Standards

• Efficiency

– A measure of what is produced divided by what is consumed

• Effectiveness

– A measure of the extent to which a system achieves its goals

• System performance standard

– A specific objective of the system

11. System Variables and Parameters

• System variable

– A quantity or item that can be controlled by the decision maker

– E.g. the price a company charges for a product

• System parameter

– A value or quantity that cannot be controlled by the decision maker

– E.g., cost of a raw material

12. Modelling a System

• Model: An abstraction or an approximation that is used to represent reality

• Types of models

– Narrative (descriptive)

– Physical

– Schematic

– Mathematical

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13. Working with Systems

Systems development : The activity of creating or modifying an existing business

system Systems investigation & analysis : Defines the problems and opportunities of an existing

system Systems design : Determine how a new system will work to meet business

needs Systems implementation : Creating and acquiring system components defined in the

design

Systems maintenance & review : Checks and modifies the system so that it continues to

meet changing business needs

Reference:

T.Lucey, ‘Management Information Systems’, Chapter 3 & 4, Letts Educational, Aldine Place,

London, 8th Edition