If we regard the figure as a realistic portrayal of the business cycle and we view the organization as if it were a system we can derive a clear context for business processes and can conclude that:
- The mission arises out of an analysis of stakeholder needs (there would certainly be little point in having a mission that conflicted with these needs)
- The mission is accomplished through business processes that form part of a system we refer to as the management system.
- The results the stakeholders are looking for to satisfy their needs must equate to the business outputs
- Business outputs are generated by business processes therefore the objectives for these processes are the business objectives (deliverable results)
- The management system should therefore be designed to produce outputs that satisfy stakeholder needs
- Within the management system we will find all the business processes and lower level processes which produce these outputs.
- Over time stakeholder needs and expectations change which in turn will modify the demands upon the business and its mission, and consequently the management system and so the cycle continues.
The Business Cycle
All organizations exist to fulfil a specific purpose and they need to be managed effectively to fulfil their purpose.
A system is set of elements interconnected for a purpose. In a system it is the interplay between the elements that produce the outputs, therefore the performance of the whole results from the interactions of the elements and cannot be predicted by analysing each element separately.
When we take a systems approach to management it means that we:
- Define the purpose of our system which in the context of a single organization and its owners, is its mission and vision;
- Identify the interconnected elements that enable the organization to pursue its mission and vision. Many of these will be internal to the organization but some will be external;
- Put a boundary around those elements that strongly influence or control the system outputs and name this system. The name we give to the system which produces results that serve its mission and vision is the management system.
We can therefore express the relationship between the mission and vision, the management system, the results and the stakeholders the results are intended to satisfy as a business cycle as shown below. (Pass your mouse over the graphic and follow the links)
© Transition Support Last edit 12/12/2022
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