System Theory
Topic 1: Systems theory, efficiency and effectiveness
Effective management is ‘making the right decisions and successfully implementing them.’ Contrast the concept of effectiveness with the concept of efficiency. Describe basic systems theory as it applies to organizations and discuss the concepts of efficiency and effectiveness in terms of inputs, throughputs (or ‘the transformation process’) and outputs. Include some examples in your discussion.
Abstract Efficiency means doing things right, while effective means doing the right things. In management, managers will strive for low resource waste (high efficiency) and high goal attainment (high effectiveness). Systems theory is an extension of the humanistic perspective that describes organizations as open systems characterized by entropy, synergy, and subsystem interdependence. It consists of five components: inputs, a transformation process, outputs, feedback, and the environment. Inputs are the materials, human, financial, or information resources used to produce goods and services. The transformation process is management’s use of production technology to change the inputs into outputs. Outputs include the organization’s products and services. Feedback is knowledge of the results that influence the selection of inputs during the next cycle of the process. The environment surrounding the organization includes the social, political, and economic forces.
In management, there are two important concepts which are efficiency and effectiveness. Efficiency means doing things right, a manager must allocate the resources well without wastage in order to produce the most output for the least inputs. On the other hand, effectiveness means doing the right things, this relates to a manager must know the organizational goals before decides how to attain them.
Here is the example of a situation to understand the difference of the two concepts. Truck driver A and truck driver B are working in the same transportation
Effective management is ‘making the right decisions and successfully implementing them.’ Contrast the concept of effectiveness with the concept of efficiency. Describe basic systems theory as it applies to organizations and discuss the concepts of efficiency and effectiveness in terms of inputs, throughputs (or ‘the transformation process’) and outputs. Include some examples in your discussion.
Abstract Efficiency means doing things right, while effective means doing the right things. In management, managers will strive for low resource waste (high efficiency) and high goal attainment (high effectiveness). Systems theory is an extension of the humanistic perspective that describes organizations as open systems characterized by entropy, synergy, and subsystem interdependence. It consists of five components: inputs, a transformation process, outputs, feedback, and the environment. Inputs are the materials, human, financial, or information resources used to produce goods and services. The transformation process is management’s use of production technology to change the inputs into outputs. Outputs include the organization’s products and services. Feedback is knowledge of the results that influence the selection of inputs during the next cycle of the process. The environment surrounding the organization includes the social, political, and economic forces.
In management, there are two important concepts which are efficiency and effectiveness. Efficiency means doing things right, a manager must allocate the resources well without wastage in order to produce the most output for the least inputs. On the other hand, effectiveness means doing the right things, this relates to a manager must know the organizational goals before decides how to attain them.
Here is the example of a situation to understand the difference of the two concepts. Truck driver A and truck driver B are working in the same transportation
References: * Samson, D. & Daft, R. L. (2005). Management (2nd Pacific Rim ed.) South Melbourne, Vic., Australia: Thomson * Robbins, S.P., Bergman, R., Stagg, I. and Coulter, M. (2006). Management (4th ed.) French Forest, NSW, Australia: Prentice Hall * Robbins, S.P. & Barnwell, N.S. (2006). Organization theory: concepts and cases (5th ed.) French Forest, NSW, Australia: Prentice Hall * Schermerhon, J.R., Campling, J. * Daft, R.L. (2008). New Era Of Management (9th ed.), International Edition, Canada: Cengage Learning * http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_02.htm * http://managementhelp.org/mgmnt/cntmpory.htm