System-Based Approach

The definition of the enterprise as a productive social system makes it clear that the enterprise as a whole should be viewed as a system and is made up of a number of subsystems. This description explains the company and its actions using system-based concepts. Several questions arise in relation to system-based management theory: how did system theory arise? What is generally understood by a system? What form do the effects of system theory take on management studies? System theory is a relatively young science, still in the process of development. It is significantly influenced by the findings of philosophers and academics from various disciplines (e.g., biologists, mathematicians, physicists, engineers, sociologists, psychologists). The company is seen as a system with a lot of interactions and unmanageable variables and not as a machine.