Unit 34-LO1 Evaluate the contribution of business systems to organizational performance-BTEC-HND-Level 4 & 5

Course: Pearson BTEC Levels 4 and 5 Higher Nationals in Business

Evaluating the contribution of business systems is an important part of determining how to improve organizational performance. This involves implementing a system for collecting and analyzing data as well as assessing current practices and forecasting plausible future scenarios. Once all this information is collected, we’ll determine which systems are requiring more attention than others, identify where processes may be improved or eliminated completely, and recommend new opportunities for efficiency that have the potential to transform your company.

The technical analysis component includes evaluating what technology should be in place to support efficient workflow management while gathering metrics on financial performance, quantity delivered, or services rendered, all while measuring speed-to-market assembly lines to ensure superior customer experience each time transactions are processed.

Identifying where improvements can be made requires deep technical knowledge, and is critical when applying Lean Six Sigma principles.

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Also Read: Analyse the internal and external factors which have an impact on systems and processes

Supporting the effectiveness and efficiency of an organization:

Definitions of business systems vs business processes

Business systems

  • Business systems are the procedures in place to accomplish specific tasks that need to be accomplished each day. It is “a unit of an organization that has a specific function or set of functions, such as accounting or personnel”.
  • Business Systems primarily serve as administrative routines such as hiring/firing employees and payroll etc.

Business processes

  • Business processes are “a sequence of activities within a company that transforms inputs into outputs”.
  • Business Processes involve designating the flow and procedure through which product(s) or service(s) will be produced so it doesn’t all have to start from scratch every time something changes.

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How do business systems enable complex organizations to function?

A business system is an integrated set of procedures, practices, and policies used by a company in its day-to-day operations. Complex organizations use them to ensure the input of relevant information, to process it effectively and efficiently, and to output it in forms that are critical for decision making. Several interwoven business systems exist within a single organization like finance, marketing management, or supply chain management.

The core idea of the development of business systems is the question of what should be captured in order to support organizational needs?

Business processes typically start with gathering data on inputs (e.g., customer demand) which are then transformed through a number of functional steps (e.g., planning or logistics). The process is then captured as an output (e.g., sales contract) and delivered to the customer.

How do business systems restrict or promote sustainable organizational performance?

Businesses have traditionally been focused on a culture of expansion and self-profit at all costs. These business systems restrict sustainable organizational performance because they perpetuate unsustainable practices such as stealing from natural resources, unfair labor practices, environmental degradation, and dependence on fossil fuels.

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However, the use of sustainable business principles can encourage corporate social responsibility through supporting mechanisms that are environmentally friendly including renewable energy technology, green building design, and construction methods, recycling techniques for unusable material, and responsible sourcing. Multiple studies have shown a positive correlation between moving away from traditional business system models to more sustainable ones results in economic growth while preserving our natural resources for future generations.

Integrated business systems

Integrated business systems provide tools that extract data from the central database to make projections and give organizations a detailed, accurate picture of how they are doing. Canned or ad hoc reporting tools allow you to generate reports on demand so you can stay ahead in any situation.

Five benefits of Business Integrated System:

Improve customer service to increase sales. Provide workers with a better work environment and more time, which will allow for increased productivity and make them feel happier as well! More hours means the worker can potentially earn more money in just one month than they could if their wage was lowered.

Perceptions and perspectives of systems


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Perceptions are the way we see things in a certain light. Systems have been designed to give people positive perceptions so they will continue to consume them. This is done to keep people buying and selling as much as possible. People are persuaded into thinking that these systems in a way benefit them, even though sometimes they do not. Although this may be true on some occasions, the meaning of “well-being” has been distorted by the persuasive power of advertising.


The perspective of a system can best be explained through two different perspectives.

  • The first is the systems as viewed by their own components, which would be from the inside out. This perspective exposes to the observer how each subsystem is functioning and what needs to happen for an event to succeed within the organization.
  • The second perspective of a system is looking at it as an outsider – this gives you a view on how those in control are managing it and what deficiencies there might be that need attention and repair such as customer service, meeting deadlines, allocating resources, etc.

The Systems Thinking approach and the use of Systems Thinking

Systems Thinking is about exploring interconnected, interdependent systems and seeing how they affect the way we run our businesses. Systems Thinking is less about having a particular ideology or philosophy than it is about understanding your business in an ever-changing world with new challenges and opportunities.

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A commonly used system for managing a business activity with a complex group of elements that interact intelligently with each other. If you’re not familiar with the concept, here’s an easy example that will help make it more clear: imagine three people sitting on one side of the room, and one person at the other end where you can’t see them–this would be an unstable situation–noticeably rotating around until someone close to them stops them from moving; this is an example of a complex system.

A strategic approach to business systems

Business systems are a critical part of any successful organization. So what is the best way to approach your business system needs?

A strategic approach can help you identify and prioritize your requirements so that they fit with your budget, timeline, industry, or size of the company. Here’s how it works:

1) Understand the current state of your business and develop an understanding of what success looks like for you in five years;

2) Research the market to understand what solutions are available and how they would work for you;

3) Meet with potential vendors to get a sense of their capabilities, while also checking out their references (this will be important if you decide to move forward);

4) Evaluate vendor offerings against what has been learned so far about desired benefits.

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Business systems and the global context

Systems are the key components of any company. Employers need systems for processes, employees have to follow a career system, and so on. Without these systems in place, companies could not run efficiently or productively.

The global context is important because it affects solving problems such as unemployment which are faced globally and involve the human scale of enterprises at work. The two come together when we look at how certain organizations offer services that meet both organizational needs across boundaries and global opportunities to learn from our counterparts with dual-level learning potential.

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