System Theory

System Theory

- Management: a system of set of interrelated and interdependent parts arranged in a manner that produces a unified whole
  - Composed of a number of subsystems and all the subsystems are related to each other
  - the systems and subsystems:

Contributions/Analysis:
  * Provides a conceptual framework for a meaningful analysis of management and organization
  * Guides managers to lay down proper emphasis on the interdependence and interrelations of various parts or elements of the organizations
  * Exerts managers to analyze and understand every element of a problem in relation with other elements
  * Tries to integrate various management theories by emphasizing the physical aspects, behavioral aspects and environmental conditions

Decision Theory

Concept:
  - Emphasizes the managers must take rational decisions as a decision maker
  - The success or failure of organization depends upon his decisions and decision making ability
  - Hiring new equipment, introducing new product, creating organizational structure, setting objectives etc.


  depends upon his discretion resulting institutional success
  - The essence of the concept:
  * Management is a decision making process
  * Members are decision makers and problem solvers
  * Organizational success is judged on the basis of quality of  managerial decisions
  * Participative approach in decision making process
  * Proper information management system
Decision Making Process:
  * Problem definition
  * Alternatives identification
  * Alternatives evaluation
  * Selecting the best
  * Implementation
  * Evaluation of the result
Contribution:
  - Helpful in developing problem skills
  - Helps to develop mathematical and quantitative tools for decision making
  - Emphasized the knowledge of economics in decision making
  - Information management
Limitation:


  - Doesn’t take the total view of management
  - Narrow and limited concept of management
  - Ignores the situational variables
  - Ignorance of human relation and behavioral science aspects




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