What does systems theory suggest about organizations?

Systems theory posits that organizations are complex entities made up of various components that are interconnected and interdependent, which aligns with the understanding that these components or activities do not operate in isolation but rather influence each other. This viewpoint emphasizes that organizations function as a whole, where the relationship between different parts can significantly impact overall performance and effectiveness. Recognizing that activities within an organization are interrelated allows for better management and optimization of processes, as changes in one area can affect others. This emphasis on interconnectedness differentiates systems theory from other organizational theories that may suggest a more fragmented or hierarchical view of operations.