The Systems View of Business

Question 1

System

Answer 1

An interconnected and coordinated set of elements and processes that converts inputs to desired outputs

Question 2

Managing Systems for Peak Performance

Answer 2

Help everyone see the big picture
Understand how individual systems really work and how they interact
Understand problems before you try to fix them
Understand the potential impact of solutions before you implement them
Don’t just move problems around-solve them
Understand how feedback works in the system
Use mistakes as opportunities to learn and improve

Question 3

Value Chain

Answer 3

All the elements and processes that add value as raw materials are transformed into the final products made available to the ultimate customer

Question 4

Outsourcing

Answer 4

Contracting out certain business functions or operations to other companies

Question 5

Value Webs

Answer 5

Multidimensional networks of suppliers and outsourcing partners

Question 6

Offshoring

Answer 6

Transferring a part or all of a business function to a facility in another country

Question 7

Pros of Offshoring

Answer 7

Companies have a responsibility to shareholder interests to pursue the lowest cost of production
Offshoring benefits U.S. consumers through lower prices
Many companies don’t have a choice once their competitors move offshore
Some companies need to offshore in order to support customers around the world
Offshoring helps U.S. companies be more competitive

Question 8

Cons of Offshoring

Answer 8

Endangers future of good domestic jobs
Hidden costs and risks
Diminished responsiveness
Knowledge transfer and theft issues
Product safety issues
National security and public health concerns