One of the major reasons why strategies in organizations fail is because they are not in accordance with general systems theory.
If we were to study the laws of nature, we would see that everything that endures is systematic. Everything that is disorderly or ad hoc, on the other hand, dies. In other words, order leads to more order, while disorder leads to chaos. So an organization, a department, a new system that is purposeful, organized and systematic will succeed; one that is disorganized and ad hoc will not.
A system is a set of interrelated and interdependent parts that forms a whole. Societies are systems, as are cars, plants, the human body, organizations, and business plans.
Organizations are systems that transform inputs into value-added outputs, products or services. As is the case with all systems, work on some part of an organization will affect every other part of that system. Systems are goal-oriented, and order will lead to more order just as disorder will lead to chaos. Also, if a particular intervention is not aligned with the forces operating within a system, that system will fight, and eventually reject, the intervention in the same way the body mobilizes to fight and dispatch any unwanted organism.
The manager who cannot conceive of an organization as a system in its entirety, who cannot think systematically about its human dimensions as well as its more tangible technical processes, and who is not comfortable in dealing with its abstract features as well as its concrete features will be limited to solutions that are concrete, familiar, and obvious. The manager who can figuratively step back and look at the entire enterprise as an interesting, multifarious, interconnected system can deal with its problems more effectively, manage it more effectively, and change it more effectively when it is in need of change.
Kabat and Fielding, argue that the systems approach may be defined in terms of five principles:
- It is goal-oriented.
- It is total-system oriented.
- It is people-oriented.
- It is responsibility oriented.
- It meets the desiderata of scientific inquiry.
Organizations with consistent track records of success have systems that support consistent performances by the large majority of their workforces. These organizations do not rely on the ability of the outstanding minority, but rather build excellence by implementing systems that focus on the competent, but not outstanding, majority.
As the late Stephen R. Covey says, Management works in the system, leaders work on the system.
According to the Sacher Associates model the ten systems essential to creating an environment or culture that optimizes employee capability and contribution are as follows:
- The Strategic Business Planning System
- The Performance Measurement System
- The Performance Management system
- The Performance Feedback System
- The Performance-linked Communication System
- The Performance Appraisal System
- The Technical System
- The Strategic Human Resource Development System (Performance-linked Learning)
- The Financial System
- The Reward System
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