Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members


A system, we had defined, as being a collection of interconnected elements that is open and exchanges matter, energy and information with the environment. Deriving from this simple definition several societal artifacts qualify to be labelled as systems, organizations being one such entity. These organizations, both business and government, are an important and significant part of the institutional framework of any nation and therefore needs to be managed extremely well. In fact, studies have revealed that countries with well-managed institutions are the ones that are most prosperous. Hence managing systems is arguably the most significant task in the governance of any nation/society and needs to be done with all the seriousness at one’s disposal. Efficacy of the task of management is greatly facilitated by a greater understanding of the entity to be managed and hence the need, in this case, to identify characteristics of systems.

Systems abound in nature as well as in society and many among them have exhibited excellence in operations and exceptional longevity. Scientists have studied systems to understand what are their common characteristics, but before dwelling on the characteristics I would like to stress on a prerequisite. This prerequisite, if satisfied, would establish that the collection of interconnected elements is indeed a system and shall therefore exhibit all the traits identified with systems. This prerequisite is that the collection be open to the environment and exchange matter, energy and information with the latter. Obviously, these exchanges impact the way a system functions and influences its quality of operations and eventually its life. If a collection of interconnected elements is not open to the environment, despite it appearing to be a system, will not exhibit the characteristics of one.


At first acquaintance with systems one fears that understanding a system is going to be far more difficult and time consuming as compared to that of a problem situation in the traditional management approach. A system, as has been reiterated, views not only a problem situation or an entity under study but also the associated significant influencing factors and that, in today’s world, could introduce many more entities to be studied. However, this necessity is obviated by the fact that a system is a unified entity and not merely a collection of entities. Elucidating this point further, when one explains the concept of systems one mentions the need to incorporate influencing factors in any inquiry and most listeners conclude that many more factors will need to be studied. This conclusion derives from our usual practice of viewing things in isolation. If however, we realise that a system is a whole then we don’t have to consider factors sequestered from each other but through relation that one element bears to others. The surfeit of factors that characterises any problem situation are related to each other to form a whole a fact that though not apparent is discovered when these are subjected to closer scrutiny.

One legitimate question at this stage is what is the significance of declaring a system as a unified whole? To really understand this let us take help of basic Chemistry. We had, in school, learnt about ‘mixture’ and ‘compound’. The former is a physical mixture of two or more elements whose resultant output exhibits characteristics of its constituents while a compound is an output of a chemical combination and gives rise to  a new product with independent characteristics. A system is akin to the latter and is not just a cumulation of independent elements but is a different entity altogether. Consequently a unified system’s behaviour would be internally consistent and would attempt to reinforce the system. For instance if environmental changes render the curriculum invalid in an education system the attempt will be to modify the curriculum to meet altered requirements. The system readjusts itself to continue doing whatever it was doing.

The next question is does every system have the ability to adjust to the environment as easily as others or are some systems more capable in this direction? If you recall the one prerequisite I had mentioned about being an open system? Well, this is the reason for the prerequisite. A system has to be continually open to the external world and be sensitive to changes taking place therein. Organizations that are unable to do so will, eventually if not immediately, be adversely affected this lacuna. You will recall how established players in the telecom sector fell to the emergence of the Android operating system and that was because they were not able to change with environmental changes!! Systems that are authentically designed are empowered with organizational limbs to capture external feedback and possess competence to identify trends and initiate internal changes consequent to the external ones. This combination of a mechanism to capture external feedback, interpret the same, initiate corrective action and ensure implementation of action plan is the true manifestation of a unified entity — the system.

Another related point that emerges from this assertion of unity is one cannot address a part of the system in isolation. If, for instance you wish to improve on one aspect of a system’s functioning you will necessarily need to address all associated issues that, in an integrated set up, bound are to arise. Most problems in implementation of major initiatives surface because certain concomitants have not been cognized with. Just to explain this further a friend spent good amount of resources upgrading the customer facing User Interface (UI) software and left the backend as it was. After the initial good feedback from customers he was compelled to bring down the new UI and strengthen the back end before it was finally accepted. Besides resources his company lost goodwill that would take months to recover.


We, as managers or professionals are often exhorted to look at the big picture before taking a decision or drawing up a plan or executing any non-trivial action; but has anyone ever mentioned what is meant by the ‘big picture’. Is it a large picture that highlights many many more elements or is something else? While the term is often used in day-to-day parlance and whose meaning is at best nebulously understood, it means something else. In my opinion it means a complete picture of the entity under study and its context. It is the enveloping unified entity that constitutes the ‘big picture’. It would immediately observed that it is not the ‘bigness’ that makes any picture a big picture but the completeness of the picture that makes it a big picture and this derives actually from the unified nature of a system.


In conclusion we can say that significant societal artifacts can be classified as systems given the way we have defined it earlier. Organizations and their functioning constitute major institutions of any society/nation and their proper management is quintessential to prosperity and growth. Management of such organizations is greatly facilitated by a deeper understanding of systems, their prerequisites and characteristics, and their behaviour under different conditions as far as it is possible to learn. Accordingly we have presented one important characteristic of systems that any manager needs to bear in mind while managing a system and that is its unified nature. It is not a collection of independent entities but a complete entity by itself. It means that viewing a system in terms of constituent entities is likely to be erroneous. One has to the underlying entity behind the   ostensibly independent elements. Secondly one cannot touch any part of the system without considering its effects of other parts as is inevitable in an integrated product. Lastly it is this unified entity that comprises the big picture. A picture is a whole where each part ahs a role to play and so is the case with systems. It is this unity of elements that makes for a big picture and not its bigness.

Authored by

Prashun Dutta

Prashun has around 35 years of varied corporate experience, former CIO at Reliance Infrastructure and Tata Power, an Electrical Engineer and a fellow in Management of the IIM(C). He is well known for his contribution to the electric utility sector where the systems implemented by him at RInfra and Tata Power have been adopted throughout the country. He is now a freelancing consultant to corporates.

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members