To illustrate efficiency, Dell keeps no inventory in warehouses and instead depends on the suppliers to deliver products to them on demand. Dell also promotes and delivers products in such a timely manner that its customer base continues to expand, therefore being effective. The performance is shown by selling more products and increasing profits (Daft, 2003, p. 58).
2. Identify the major components of systems theory. Is this perspective primarily internal or external? Explain.
Systems theory, an extension of the humanistic perspective, takes place in organizations that interact with the environment. Organizations are interested in profitable outputs of products or services, which please employees and customers. To achieve that goal, the need inputs like raw material, money and labor. Production technology and well-organized management will help to transform inputs into outputs. Most companies are open systems, which are based on environmental interaction. The environment helps companies gather sufficient resources and also provide feedback for the next production cycle. (Daft, 2003, p. 52).
The organization of the subsystems is another component of systems theory. Managers group their company into different departments and allow the departments to perform specific independent tasks to benefit the entire organization. Since all departments are dependent on one another, changes in one part of the company will influence other departments. Therefore, when all departments work efficiently and effectively, the entire organization is productive. .
The departments also must be dedicated to working together to achieve a common goal. An organization's goals must be set above the goals of individuals or department's. When the company functions as a whole instead of separate entities, the organization can become successful. This concept is known as synergy.
There are essential internal factors such as production technology, labor management and organization but it evident that the external issues are more important than the internal ones in the systems theory.
