What you should know about business systems?

Business systems provide a framework of principles and practices for the organization to apply to personnel, machines, and procedures. This framework aims to minimize inefficiencies in the organization and help develop operations. Business systems are created to form a competent group of interrelated processes focused on realizing the organization’s goals and objectives.

Business systems cater to the various functions of the organization. Common business systems are Accounts Receivables, Accounts Payables, Sales Conversion, Lead Generation, Customer Services, Inventory, and Logistics. Each of these will be directed by the organization’s policies and strategies to fulfill system-level purposes which contribute towards the larger objective. Many of these will be customer-centric as they will aim to increase revenues and profits by optimizing processes and reducing costs and inefficiencies.

Good business systems must adhere to the guidelines of being simple, with focused objectives. Constant recording and evaluation of the systems, so they can be updated or optimized as needed, is also a crucial part of the process. And the hierarchy of accountability, within each system and among the different systems, ensures the involvement of multiple people in each strategy formulation and policy implementation. The entire set of business systems within an organization should work in harmony to facilitate this.

There are several types of business systems that can exist within a single organization, and each type plays a specific role and contributes to the overall purpose. Some commonly found types of business systems in organizations are man-machine systems, pure machine systems, sub-systems, super-systems, physical systems, permanent systems, and temporary systems. Generally speaking, business systems tend to be permanent man-machine systems which exist from the formation of the organization to its dissolution although some may exist from the point that the organization grows to a certain extent or steps into new ventures.

Organizations that want to clearly define the purpose and scope of the different business systems, should first take the time to understand why they want to set up the system before evaluating the most suitable type of system for the task at hand. Upon identifying the type of system, the organization should then outline the system and ensure that it will have all the characteristics of a good business system. Post this they should formulate the appropriate strategies and policies to create the system or modify it, as the need may be. This will empower the organization through the creation of an optimal business system that caters to the organization’s goals.

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