Chapter .

CHAPTER 1

CONCEPT AND DEFINITION OF SYSTEM

Learning Objectives:
• Concept and definition of ‘System’; elements of System.
• Interaction between a system and its environment; types of system.
System as a value addition process. Quality aspects of a system.
• ‘Systems Approach’ to problem solving, its applications and personal
factors involved in it.

1.0 System Study

1.1 Introduction
We live on the planet Earth, which is a part of the larger system known as the solar system. Earth has several
independent and interacting systems, such as: Weather system, Life system, etc. The creation, continuation,
maintenance and destruction of these systems are taken care of by this planet, naturally. These systems are called
‘Natural systems’.
The life system of Earth has several species. Humans are one of these several species (or subsystems of life
system). Like other species, humans also need food to survive. Food comes from food cycle or ‘Food system’
(which is itself a part of the life system).
Apart from natural systems, there are other systems also. Necessity has led to the invention and continuation of
these systems. The creation, continuation, maintenance and re-structuring/destruction of these systems are taken
care of artificially, i.e., only by human involvement and hence known as ‘artificial system’ or ‘man-made system’.
Artificial system includes: education system, water supply system, electric supply system, health system (doctor,
nursing homes, medicines, etc.), communication system, transport system, Government system, etc. Artificial
systems attempts to continuously produce consistent results. The results are so consistent that the presence of such
systems are even forgotten, until and unless these systems fail to produce desired results — for example, water
supply system, electricity supply system, etc.
In our day to day life, we come across several systems (natural and/or artificial). Business organizations also are
examples of a system. In a business organization, there are several divisions, functions or departments that are
subsystems of the main business system. Each of these subsystems is complex and in turn has component modules
or subsystems. Marketing, manufacturing materials, finance are some examples of component modules of a
business system. The modules or subsystems that are present in a business system would be governed by the nature
of business, the type of operations, and the environment in which the business operates and so on.
Hence we observe that, irrespective of natural or artificial, every ‘system’ has certain common identifiable features
and common working procedures. Necessity determines the need for a system, the continuance/discontinuance of a
system and its relevant updating and other requirements.
This chapter is dedicated to the study of what a ‘system’ is, in general terms; steps involved in analysing,
designing, implementing, maintaining of artificial system; and related topics.

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Chapter .2

1.2 Definition of ‘System’

In absence of a standard definition of system, let us observe a few definitions of systems to conclude upon its
characteristic features.
 “A system is a group of at least two inter-related and interacting components forming a
unified whole, working together to achieve a common goal by accepting inputs to produce outputs in
organized transformation.”

 “System is an orderly arrangement of a set of inter-related and integrated components or

elements that collectively operate to accomplish a common goal.”

 “A set of interacting elements responding to inputs to produce outputs.”

 “System is an ‘organised or complex whole’ and ‘organised complexity’.” — Bertanalaffy

(theorist).

Thus, we observe that:

(i) One system consists of more than one part, known as component or element or module.
(ii) A system is an ‘organised complexity’ — i.e., each individual component with its individual objective and
procedures, works independently as well as interactively in harmony and synchronisation (that is to say, as
a unified whole), such that the objective of the main system can be achieved by combined effort.
(iii) A system may be a part of a larger system and at the same time may have its own sub-systems — i.e. a
system is a ‘complex whole’
(iv) Each system has a model or an abstraction, which states the inputs, processes and outputs.

1.3 Elements of a System

Input resources flow from the input element through the transformation element to the output element to produce
the output resources as per the objectives of the system.
There is also a control mechanism. A control mechanism monitors the transformation process to ensure that the
system objectives are confined to.

S u p e r S y s t e m

I N P U PT R O C EO S US T P U T
f e e d b a c k &
c o n t r o l m e c h a n i s m
S y s t e m
e n v i r o n m e n t

Fig. 1.1 — Elements of a System

The control mechanism is connected to the resource flow by means of a feedback loop. The feedback loop obtains
information from the system output and makes it available to the control mechanism which compares these signals
with the system objective and takes appropriate actions whenever necessary.

1.4 System Environment

Environment may be defined as “everything that isn’t me” or “every thing that surrounds the object under review”.
System environment is “the collection of elements which surrounds the system, which may interact with it”.
Thus, system environment is outside the system, of which the system under study, is a part. The environment of a
system may consist of people, organization and other systems/sub-systems from which the system under study
receives inputs, derives process to convert these inputs to outputs and provides output.
Not only the environment of a system varies from system to system and time to time, systems also always don’t
interact with the environment in the same manner.

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Chapter .3
During the design phase of a artificial system, there is control over the system, but little or no control over the
system’s environment. A feedback loop is connected to the control mechanism of a system in order to monitor and
control the workings of the system being developed. Accordingly, the control system must be able to absorb the
feedback in the shortest time and keep the system stable and proper.
It is clear that a system can be monitored and controlled, but the environment of the system cannot be controlled.
Question may arise as to whether the environment of a system remains static or it is dynamic. In fact, the
environment consists of elements and systems which are outside the system under review. Since the system under
review interacts with the environment, it has some influence on the environment — howsoever significant or
ignorant it may be. Similar is the case for other systems/components of the environment. Hence the environment of
a system is dynamic and the rate of dynamism depends on the influence of the systems/components of that
environment.

1.5 System Boundary

‘System boundary’ is expressed in terms of constraints that separate the system from its environment”.
All systems have to have a boundary, which depicts the scope of activities. The system is within the boundary and
the environment is outside the boundary.
The system analyst defines the boundary of a system to suit the purposes of a particular study.
Sub-systems are part of a larger system. Each system is composed of sub-systems which in turn are made up of
other sub-systems; each sub-system being delineated by its boundaries. Thus, we get the concept of system as an
‘organised whole’ and ‘organised complexity’, as has been stated by Theorist Bertanalffy, earlier.

1.6 System Interface

The interconnections for interactions between systems/sub-systems are termed as ‘System interfaces’. System
interfaces occur at the system boundary and takes the form of inputs and outputs, in which the system
analyst/designer has almost complete control.
Thus, system interface represents the flow of data from one sub-system to the other.
n( n − 1)
The maximum number of interfaces within one system with a given number of sub-systems is:
2
As the number of interfaces goes on increasing, it creates additional problem during system integration (i.e.
combination/assimilation of systems to function as one whole). The objective must be to have minimum number of
interfaces. This can be achieved with the help of creating functional data base. One data base helps us to combine
all the related data at one common place which can be simultaneously accessed by different sub-systems. It avoids
the flow of data therefore eliminate the need for system interfaces.

1.7 Sub-system
When a complex system is comprehended as a whole, it becomes very difficult and cumbersome and hence,
decomposition becomes extremely essential.
‘Sub-system’ is a part of a larger system. The system is factored into sub-systems, so that sum of sub-systems
constitutes the entire system.
A system is broken or decomposed into sub-system(s), in order to help analyse an existing system; design and
implement the new system.
This process of decomposition is continued within the sub-system until the smallest sub-systems are of manageable
size.
‘Supra-system’ refers to the entity formed by a system and other equivalent systems with which it interacts.
Illustration: A town’s Government is a system, but it is also a part of a larger system: the Government of State or
Province. The State or Provincial Government is a super system of the town Government and is also a sub-system of the
National Government. The National Government and State/Provincial Government is the supra system for the town’s
Government.
Sub-system performs specialised tasks related to the overall objectives of the total system. Some of the Sub-
systems can be differentiated from each other by:
(i) Function (e.g. – production, sales, purchase, etc.)
(ii) Space (e.g. – region, geographical locations, etc.)
(iii) Time (e.g. – 1st, 2nd, 3rd, etc.)

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Chapter .4
(iv) Formality (e.g. – relationship amongst each other, etc.)
(v) People (e.g. – Top/Middle/Lower level, etc.)
Illustration:

F e e d b a c k & C o n t r o l M e c h a n i s m

In p u t s O u tp u ts
S a l e s

B u s i n e s s F i n a n c i a l
S y s t e m M a r k e t i n Pg r o d u c t i o n S y s t e m
F i n a n c i a l
A c c o u n t i n g
P e r s o n n eA l c c o u n t s
F i n a n c i a l
M a n a g e m e n t

i n - h o u s e
Tr
R e c r u i t m Te n r ta i n i n g a
P e r s o n n e l S y in in
r s st
em g
o u t s i d e o t h e
S y s t e m
P e r f o r m a n c e
P l a c e m e n t
e v a l u a t i o n

L e g e n d s :

E l e m e n t / M o d u l e / C o m p o n e n t

S y s t e m I n t e r f a c e s
» e v e r y t h i n g o u t s i d e s y s t e m b o u n d a r y i s s y s t e m e n
» b i g g e r s y s t e m i s S u p r a S y s t e m

Fig. 1.2 — Components, interfaces, boundaries of a system and its sub-systems.

1.8 Categories of Systems

Two broad categories of systems are —
(i) Natural Systems: Systems developed, implemented and maintained by nature. Humans are part of natural
systems. Examples: Solar System, Weather System, Life cycle, etc.
(ii) Artificial (or Man-made) Systems: Systems defined, designed, implemented and maintained by human
efforts and knowledge, where nature may or may not play any part. Examples: Education System,
Transport System, Communication System, Government & Administration System, etc.

1.9 Types of Systems

S Y S T E M S

a c c o r d i n g t oa ec cl e o m r d e in n t gs : t o i n t a e cr c a o c r t id v i e n bg e t h o a o v u i o t pu u r :t /
A b s t r a c t S y s t eOm p e n S y s t e m D e t e r m i n i s t i c S y s t e m
P h y s i c a l S y s t e mC l o s e S y s t e m P r o b a b i l i s t i c S y s t

Fig. 1.3 —Types of Systems

Following are the types of systems:
1. According to elements:

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Chapter .5
(i) Abstract System: an orderly arrangement of interdependent ideas or constructs, also known as
‘conceptual System’ (e.g.: religion, superstition, etc.).
(ii) Physical System: a set of tangible elements which operate together to accomplish an objective (e.g.
transport system, production system, etc.)
2. According to interactive behaviour:
(i) Open System: actively interact with other systems and establish exchange relationship.
(ii) Close System: does not interact with outside environment and is self-contained and independent, are of
two types – fully closed (e.g. clock, etc.), relatively closed (e.g. Inland security policy, Examinations
department of an education University, etc.).
3. According to output working:
(i) Deterministic System: Operates in a predictable manner, where there is certainty of operation among
the parts (e.g. correct computer program which performs exactly according to a set of instructions).
(ii) Probabilistic System: Systems that can be described in terms of probable behaviour, having a certain
degree of error attached to the working of the system (e.g. sales system, inventory system, etc.)

1.10 System — a ‘value-addition’ process

The inner workings of a system or sub-system are organised to produce required outputs from available inputs.
There may be constraints or lacking of inputs — even then, inputs are always more than output obtained because of
process loss, etc.
However, in the process of conversion of inputs to outputs, some value or utility is being added to the inputs by the
system processed. Although outputs may be lesser than inputs, they have more utility than the inputs. In other
words: Outputs are obtained by processing inputs at an incurred expenditure, yet they have higher value than the
inputs.
Hence, a system can be viewed as a value addition process.

1.11 Quality aspects of a System

The output of a sub-system or a system (may) become the inputs for the next. These outputs have to adhere to
certain standards in order to be acceptable to the next. Here comes the concept of quality.
Quality is the performance and functional specification of the system.
Quality differs from quality assurance. Quality assurance is the process for ensuring the achievement of
performance and functional specifications (i.e. assurance for achieving quality).
Quality Control is a control mechanism concerned with controlling the quality aspect of the system.

2.0 Systems Approach

‘Problem’ is the cause of the trouble, or the cause of the opportunity.
‘Symptoms’ are conditions produced by the problem.
The term ‘problem solving’ brings to mind the correction of things that are going wrong.
Managers quickly respond to influences seeking to prevent or minimize damage. Further, they also respond to
things that are going better than expected. During the course of problem solving, managers are involved in the
process of decision making, in presence of several problem-solving elements. The problem structure influences
how problems are solved and gradually in the problem solving process, the manager becomes careful to distinguish
symptoms from cause.
The systematic approach to problem solving is known as Systems Approach:
“Systems Approach is a series of problem-solving steps that ensure that the problem is first
understood, alternative solutions are considered and finally the selected solution works.”
‘Decision’ is a selection of strategy or action.
‘Decision making’ is the act of selecting the strategy or action that the manager believes will offer the best solution
to the problem.
Problems are of three types –

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Chapter .6
 Structured problem are of ‘if-then’ nature – i.e., they have a cause-effect relationship and a proper
format. Structured Problems require Structured Decision Making. Structured decisions making follows
pre-determined set of rules and the outcomes of such decision-making have maximum certainty and
stability. These decisions are often repetitive and routine in nature. The choice phase of structured
decision making follows the conditions and rules for actions. Due to the repetitive action-condition based
nature of decision making, Computers may alone solve structured problems by pre-written human
instructions (in machine language), where managers have little or no role to play. Structured decision-
making are mostly required at the lower level (operational level), which keeps on decreasing until at the
top level, where there is least structured decision making.
 Unstructured problems. Situations arise where predetermined reactions to situations can not be
predicted. Such decisions cannot be made purely on pre-determined rules because the situation for which
rules are to be framed, are unknown or unpredictable. These types of problems are known as unstructured
problems and associated decision-making is known as Unstructured Decision making. Unstructured
decision making are complex in nature. Further more, the risks involved are maximum. Such decision
making are mainly used by Top management, and keeps on decreasing with the level of management.
Unstructured problems must be solved by managers (i.e., human tact, knowledge and expertise), with
computer support.
 Semi-structured problems. With structured problems on one extreme and unstructured problem on
another extreme, in between the two are semi-structured problems. Such problems are partly structured
and partly unstructured. Semi-structured problems required Semi-structure decision making. Managers
and Computers may solve semi-structured problems by working together.
There are two types of measures: proactive measure (measure taken before happening) and reactive measure
(activities following as an effect of something that has already happened).

2.1 Personal factors influencing problem solving

The problem-solving style differs from manager to manager, which influences problem sensing, information
gathering and information using, discussed below.

2.1.1 Problem sensing

Managers have to become aware of the problem. He has to ‘sense’ the problem. There are three categories of
problem sensing:
Styles Attitude Problem-Sensing technique used
Problem avoider Assumes everything to be Attempts to block out possibility of problem by ignoring
fine. or bypassing information regarding problems
Problem solver Solves problems when Neither blocks-out nor avoids problems, but solved
they arise. problems whenever they arise.
Problem seeker Enjoys solving problems. Seeks to find out problems, in order to solve them.

2.1.2 Information gathering

The next step to problem sensing is developing of alternatives for decision making. Managers can exhibit one of the
following two attitudes towards the total volume of information available to them, which is known as Information
gathering.
Styles Attitude towards total volume of information
Perceptive Style Manager screens out everything that is not relative to the area interest.
Receptive Style Individual information is reviewed and evaluated to see as to whether it suits
the area of interest, or it suits the area of interest of some one else in the
organization.

2.1.3 Information using

Relevant information gathered needs to be put into actual use in order to solve problems.
Information using styles Attitude towards using information
Systematic Style Manager pays particular attention to follow a prescribed method of problem
solving, such as the systems approach.

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Chapter .7
Intuitive Style Manager does not favour any certain method or style, but tailors the approach
to the situation.

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