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The Idea of a (Bounded) System

What is a (Bounded) System?

A business system on this site is an agglomeration of agents/actors
(employees, partners) taking inputs and processing them to create
outputs and waste in the pursuit of an overarching goal.

All business systems are legally and operationally bounded. But they
are not closed. The boundaries are permeable allowing
resources/energy and ideas to cross from and to the context in which
the system is embedded.

A bounded system is an agent/actor embedded in the context. As an
agent/actor in the context business systems (firms) share
characteristics with individuals. A business organization has goals,
motivations, culture, and exhibits behaviors. Individual actors have
their own ambitions, motivations, personality, and exhibit behaviors.

Socio-technical Systems

In the business literature, business systems are described as socio-
technical, a term developed initially by the Tavistock Institute for
studying Human Relations in the 1940s. A socio-technical system
consists of two linked forms:

● A technical system: this is the set of equipment, policies,
procedures, and processes that produce an outcome. It could be
the technical side of a factory or the body of knowledge and
processes that comprise the work side of a consultancy.
● A social system: this is the agents/actors interacting inside a
bounded organization that operates the technical system and
manages the total entity in the pursuit of on overarching

(system) goal.
Examples of socio-technical systems include firms, government
departments, military and charitable institutions, structured activist
groups; indeed, any bounded grouping that performs work in the
pursuit of a goal.

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