Chapter 6
Systems ConceptsSystems Concepts
Four Model Types Four Model Types
1)
1) Physical modelsPhysical models
– Three dimensional representation such as a scale Three dimensional representation such as a scale
model
model
2) Narrative models 2) Narrative models
– Spoken or writtenSpoken or written
3) Graphic models 3) Graphic models
– Abstraction of lines, symbols, or shapesAbstraction of lines, symbols, or shapes
4) Mathematical models 4) Mathematical models
– Equation(s)Equation(s)
Cost
Order Quantity
0
EOQ
Total cost
Mainten
ance co st
Purchasing cost
A Graphic Model of the A Graphic Model of the
A. A Flowchart A. A Flowchart
Sales
Orders
Orders
Report
Enter Sales Order Data
Prepare Sales Order Report
Sales Order History
File
B. A Data Flow Diagram B. A Data Flow Diagram
Customers Enter Sales
Enter Sales Orders Orders
Edit Sales Edit Sales Orders
Prepare Sales Order Report
Sales Order History File
Uses of Models Uses of Models
All four models facilitate understanding and All four models facilitate understanding and
communication.
communication.
The mathematical model also helps predict The mathematical model also helps predict
the future.
The General Systems The General Systems
Model Model
Graphic diagram with an accompanying Graphic diagram with an accompanying
narrative that depicts all organizations in a
narrative that depicts all organizations in a
general way, using a systems framework
general way, using a systems framework
The Physical SystemThe Physical System
Transformation Process
The Physical System of the The Physical System of the
Firm Firm
Input
Resources
Output Resources
The Conceptual System The Conceptual System
Open-loop systemsOpen-loop systems
Closed-loop systems (feedback loop)Closed-loop systems (feedback loop)
Management controlManagement control
Transformation Process
Control Mechanism
Input Resources
Output Resources
A Closed-Loop System A Closed-Loop System
Management
Transformation Process Input
Resources
Output Resources
Information Information
The Physical System of the Firm The Physical System of the Firm
Information is Gathered Information is Gathered
from All of the Physical from All of the Physical
System Elements System Elements
Management
Transformation
Process ResourcesOutput
Input Resources
Management Information Processor
Output Resources Input
Resources
Information Information
Data
Transformation Process
The Information Processor Transforms The Information Processor Transforms
Conceptual System (cont.) Conceptual System (cont.)
Dimensions of InformationDimensions of Information
– RelevancyRelevancy – AccuracyAccuracy – TimelinessTimeliness
– CompletenessCompleteness
Conceptual System (cont.) Conceptual System (cont.)
Standards Standards
– Measure of acceptable Measure of acceptable
performance
performance
– Usually stated in specific Usually stated in specific
terms
terms
– Used to control physical Used to control physical
system
system
– Consists of:Consists of:
» ManagementManagement
» Information processorInformation processor » StandardsStandards
ObjectivesObjectives
– Overall goal that a Overall goal that a
system is to obtain
system is to obtain – Systems have one or Systems have one or
more objectives
Output Resources Input
Resources
Management InformationProcessor
Transformation Process Standards
Information Information
Data
Performance Standards are Made Available Performance Standards are Made Available
to Both Management and the Information to Both Management and the Information
Conceptual System (cont.) Conceptual System (cont.)
Management by exceptionManagement by exception
– Compares standards with information output of Compares standards with information output of
system
system
– Manager becomes involved when system falls Manager becomes involved when system falls
outside range of acceptable performance
Standards
Management Information
Processor
Output Resources
Transformation Process Input
Resources
Data
Information Decisions
Changes are Made in the Changes are Made in the
Physical System Through the Physical System Through the
Conceptual System (cont.) Conceptual System (cont.)
Decision FlowDecision Flow
– Data is transformed into information by the Data is transformed into information by the
information processor
information processor
The General Systems Model of the
The General Systems Model of the
Firm
Firm
Standards
Management Information
Processor
Output
Resources Physical
Resources Information and
