How Organizations Perform Organizations are systems designed to achieve a goal or perform a particular function such as delivering a completed product to a customer. To illustrate our point, we will use a cafeteria analogy to describe the systematic nature of organizational processes. Although the organization asa whole is a system, it is also comprised of built-in subsystems and subprocesses. The subsystems and sub processes are designed to achieve the sub goals that are necessary to produce the overall output. For instance, the process of delivering the receipt to the customer is a sub process of the overall goal of the cafeteria.
To continue with our analogy, imagine yourself in line at a cafeteria. You come to the coffee urn and turn the spigot. Out comes some coffee. Presumably, when the liquid went into the machine, it was water—not coffee. When the coffee grounds were put into the machine, they weren't in consumable, drinkable form. The water and the coffee are the material "inputs" to the system called a coffee machine; the "output" is drinkable coffee. But someone had to add the water and the coffee grounds. This person is also an input. Furthermore, the machine will work properly only if these materials are added in the proper amount, in the proper place, and in the proper sequence. There is a technology for the machine and for making the coffee. That technology is a third vital "input" to the system. And after the machine is turned on, it takes a little time for the water to heat and the coffee to percolate;therefore, time is also an "input." So we have identified four necessary inputs to every system: material, people, technology, and time.
When you reach the end of the line, a cash register "outputs" an itemized bill for your meal—but it can do so only if the cashier "inputs" the prices. Later, when you decide you'd like another cup of coffee with dessert,you tell an attendant, who then brings that second cup to your table. The attendant provides an "output" in the same sense as the coffee machine or the cashier, but this output is different: It's a service rather than a product. The organizational processes are another component of the organizational systems. Processes represent the series of planned steps involved as an organization progresses toward its final output. The work performed within the system and subsystems transforms the inputs into outputs.
In that cafeteria, in rooms you can't see, some people create recipes and menus;others add up the bills to see how business is going and make sure that all funds are accounted for. These are the people who select the outputs, procure the materials, select the people, and establish the standards. These are the systems and subsystems of the overall processes of the cafeteria. Employees involved are called "managers" and have titles such as President, or Chief Executive Officer (CEO), or General Manager; there will be subsystems with managers for Sales, Manufacturing, Research and Development; there may even be someone called Training and Development Manager.
By definition, every system must have an output. The cafeteria must produce food; its coffee machine must make coffee; its cashier must collect money; the CEO must see that the cafeteria shows a profit. In the same way, the Sales Manager must produce advertisements and campaigns; these, in turn, produce customers. What does the Training and Development Department produce?