Although we have discussed the importance of the organisation, a sound organisation structure by itself does not guarantee success. According to Prof. Drucker good organisation structure does not by itself produce good performance-just as a good constitution does not guarantee great presidents, or good laws or a moral society. But a poor organisation structure makes good performance impossible no matter how good the individuals may be.
Organisation As A System
Systems concept recognises that organisations are made up of components, each of which has unique properties, capabilities and mutual relationships. It further recognises the significance of system and emphasises that a whole composed of various parts may be quite different from the simple sum of its parts. There are many and varied definitions of the term 'system’. Most definitions involve such phrases as ‘complex whole’, ‘set of entities’, ‘set of relationships’, ‘resources network’, and ‘conglomeration of interrelated parts’. For the purpose of our analysis, we may define system as an arrangement and set of relationships among multiple parts operating as a whole. An organisation viewed as a system is composed of many interdependent and interrelated parts known as sub-system. Every sub-system is itself a system composed of smaller interrelated parts of sub-systems.
Components of an Organisation System
An organisation as a social system consists of the following components :
a) Inputs : The system takes certain inputs from its environment. These inputs are human resources, material resources, energy and information.
b) Processor : The processor or throughput involves the utilisation of inputs within the organisation to produce the desired outputs. A number of sub-systems such as production, marketing, finance, personnel and research and development must be created for processing or transformation. There are further sub-systems within each sub-system. The individual employee is also a sub-system and he or she is composed of multiple physical and psychological sub-systems. Interrelatedness among all the sub-systems must be kept in mind all the time.
c) Output : The output of an organisation may be both intended and unintended. Intended outputs are usually labelled objectives. For instance, high productivity is an intended objective. The output may consist of goods and services. An unintended output may be informal relation among the group members.
d) Management : The management component of the system is concerned with the determination and implementation of processor activities in order to achieve intended outputs. Managing involves planning, organising, staffing, directing and controlling. For managing, feedback of information concerning the quality, quantity, cost and time of system outputs is necessary. Standards concerning desired results must be established and enforced by management through the feedback initiation activity. If outputs are named improper or inadequate according to the predetermined standards, corrective measures such as guidance and warning of workers, improvement of planning and organising, revision of standards, etc. are initiated.
