Paper Example on System Theory of Management

Paper Type:  Literature review
Pages:  3
Wordcount:  600 Words
Date:  2021-06-28

According to the system theory of management, organizations exist in an environment that is surrounded by major forces that determine the progression of activities in the organizations. As such, organizations may choose an open or closed system structure. In the pen structure, the organization is affected by the environment, and the interaction occurs through the exchange of information, input, and output to the environment. Such a system exists such that there is a permeable boundary between the firm and the environment through social political and economic systems. The influences range from the people working in the company, marketing channels adopted by the sales group and the inputs and other materials involved. In the closed structure, the organization strives to remain aloof and unaffected by the external environment. This occurs by the rationalization of work through endeavouring to ensure increased productivity of the human resources. The closed system of organization was informed by Taylor, Ford, toyotism, and fayolism. Notably, businesses are shaped by both macro and the microeconomic environment. Apparently, organizations die or are transformed when the need they were meeting is replaced by another one or the company becomes incapable of meeting those needs for one reason or another.

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Apparently, times have changed, and the approaches given to management have changed significantly from that experienced during the times of people like Fayol and Taylor. Toyotism is still used currently, but the approach has changed slightly to suit the modern needs. There is the utilization of technology to increase efficiency through the reduction of the wastes and reducing holding costs of inventory using the lean manufacturing. The Just In Time approach used in the Lean manufacturing seeks fast movement of raw materials that just enough materials are available as they are needed (Horst, Broday, Bondarik and Xavier, 2015). Such reduces the holding costs and minimizes delays which might be costly in the production process. According to Fayol, good management involves five key elements for the organization to run smoothly. HE suggested that managers should be able to plan, organize, command, coordinate and harmonize all the materials, resources and people in an organization. Taylorism and Fordism have the same outcome of the assembly lines striving to ensure that the process is bringing the desired result. Such standpoints have been very instrumental especially in the mass production of commodities because economies of scale can be realized and considerable costs realized.

However, in this era, there is a paradigm shift from these approaches to that which is more current and incorporates the social, economic and political aspects in the management. The realization that management cannot be undertaken in isolation from the external environment becomes handy. Ergonomics seems to be a new terminology in this field, but its one that accepts the human behavior as a fundamental determinant in the well-being of any organization. It involves disciplines like psychology, anthropology, applied psychology, engineering, environmental medicine, among others (Horst, Broday, Bondarik and Xavier, 2015). The human resources play a central role as they interact with systems such that if they are not valued as the main aspects in the attainment of organizational goals, then failure is possible to ensue. Application of ergonomics in firms ensures good health care for employees, conducive working environment as well as increased productivity and sustained motivation to work. That is why it is important that employees participate in activities that ensure their development and increased productivity.


Horst, D. J., Broday, E. E., Bondarik, R., & de Paula Xavier, A. A. (2015). Open or closed? Macroergonomics approaching socio-technical systems productivity: An overview of the conceptual framework. Social and Basic Sciences Research Review, 3(2), 98-115.

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