materials, labor, and capital. We see a technological process cre ated for transforming raw materials into finished product. linished product, in turn, is sold to a customer. Financial
institute tions, the labor force, suppliers, and customers are all part of the environment, as is government. the degree to which a system is opened or closed varies within systems. An open system, for instance, may become more closed if contact with the environment is reduced over time. The reverse would also be true. General Motors, from its through the carly1960s, operated as if it were basically a closed system. Man agreement decided on the products it wanted to sell, produced those products, and offered them to customers. GM assumed that what ever it made would sell, and for decades it was right. Government was generally benign, and consumer-advocate groups were non existent or had little influence. GM virtually ignored its environ ment, for the most part, because its executives saw the environment as having almost no impact on the company's performance. While some critics of GM still attack the firm for being too insulated from its environment, GM has certainly become more open. The actions of consumer groups, stockholder’s, government regulators, and reign competition have forced GM to interact with, and be more responsive to, its environment. So while it may not be the model for an open system, GM is more open today than it was thirty years ago. Characteristics of an Open System. All systems have inputs, trans formation processes, and outputs. They take things such as raw materials, energy, information, and human resources and convert them into goods and services, profits, waste materials, and the like. Open systems, however, have some additional characteristics that have relevance to those of us studying organizations. 1. Environment awareness. One of the most obvious characteristics system is its
recognition of the interdependency between the system and its environment. There is a boundary that