System Concept: Components, Characteristics, Elements

What is a System Concept?

The term “System” is derived from the Greek word systema. It means an organized relationship among functional units or components. We can define a System as a combination of resources or functional units working together to accomplish a given task.

The term “working together” in system definition is very important as all the components are interrelated and interdependent and cannot exist independently. As the definition says, these components interact with each other to accomplish a given task, which is actually the objective of the system.

Components of System

The components that comprise a system may be the various inputs required by the system, the outcomes or the outputs of the system, the resources required to make the system functional, etc. The system concept includes the following components of systems:

  1. Environment and Boundaries
  2. Natural and Human-Made Systems
  3. Theoretical Framework
  4. Process and Transformation Process
  5. Subsystem
  6. System Model
  7. System Architecture

Environment and Boundaries

Systems are considered as a complex system of interconnected parts. System defining its boundary; this means choosing which entities are inside the system and which are outside – part of the environment. We then make simplified representations (models) of the system in order to understand it and to predict or impact its future behavior. These models may define the structure and/or the behavior of the system.

Natural and Human-Made Systems

There are natural and human-made (designed) systems. Natural systems may not have an apparent objective but their outputs can be interpreted as purposes. Human-made systems are made with purposes that are achieved by the delivery of outputs. Their parts must be related; they must be “designed to work as a coherent entity” – else they would be two or more distinct systems.

Theoretical Framework

An open system exchanges matter and energy with its surroundings. Most systems are open systems; like a car, coffeemaker, or computer. A closed system exchanges energy, but not matter, with its environment; like Earth. An isolated system exchanges neither matter nor energy with its environment. A theoretical example of such a system is the Universe.

Process and Transformation Process

A system can also be viewed as a bounded transformation process, that is, a process or collection of processes that transforms inputs into outputs. Inputs are consumed; outputs are produced. The concept of input and output here is very broad. E.g., the output of a passenger ship is the movement of people from departure to destination.


A subsystem is a set of elements, which is a system itself, and a component of a larger system.

System Model

A system comprises multiple views. For the man-made systems, it may be such views as planning, requirement (analysis), design, implementation, deployment, structure, behavior, input data, and output data views. A system model is required to describe and represent all these multiple views.

System Architecture

A system architecture, using one single integrated model for the description of multiple views such as planning, requirement (analysis), design, implementation, deployment, structure, behavior, input data, and output data views, is a kind of system model.

Characteristics of System

There are five types of characteristics for a system. They are:

  1. Organization
  2. Interaction
  3. Interdependence
  4. Integration
  5. Central Objective


Organization implies structure and order. It can also be defined as the arrangement of components that helps to achieve objectives. For eg: – in the design of a business system, the hierarchical relationships starting with the president on top and leading toward the workers represent the organization structure.

This gives the authority structure and specifies the formal flow of communication. Likewise, a computer system is designed around an input device, a central processing unit, an output device, and one or more storage units.


Interaction refers to the manner in which each component functions with other components of the system. i.e., there should be an interrelationship between each component of a system. For eg: – in an organization, there should be an interaction between the purchasing department and production department, the same way advertising with sales, and payroll with personnel.

In a computer system, the central processing unit must interact with the input device to solve a problem. In turn, the main memory holds programs and data that the arithmetic unit uses for computation.


This is one of the important characteristics of a system. Interdependence means the parts or components of an organization or computer system depend on one another. Each component or part should depend on other components of an organization. One component or subsystem depends on the input of another subsystem for proper functioning, i.e., the output of one subsystem is required input for another subsystem.

For example: A decision to computerize an application is initiated by the user, analyzed and designed by the analyst, and programmed and tested by the computer operator. In the below figure: none of these persons can perform properly without the required input from others in the computer center subsystem.


Integration refers to the holism of systems. Synthesis follows analysis to achieve the central objective of the organization. It is concerned with how a system is tied together. It is more than sharing a physical part or location. It means that parts of the system work together within the system even though each part performs a unique function.

Central Objective

The last characteristic of a system is its central objective. Objectives may be real or stated. The important point is that users must know the central objective of a computer application early in the analysis for a successful design and conversion.

Elements of System

The following are considered the elements of a system in terms of Information systems:

  1. Outputs and Inputs
  2. Processor
  3. Control
  4. Environment
  5. Feedback
  6. Boundaries and Interface

Outputs and Inputs

A major objective of a system is to produce an output that has value to its user. Whatever the nature of the output (goods, services, or information), it must be in line with the expectations of the intended user. Inputs are the elements (material, human resources, and information) that enter the system for processing.

Output is the outcome of processing. A system feeds on input to produce output in much the same way that a business brings in human, financial, and material resources to produce goods and services. It is important to point out here that determining the output is the first step in specifying the nature, amount, and regularity of the input needed to operate a system.

For example, in systems analysis, the first concern is to determine the user’s requirements of a proposed computer system that is, the specification of the output that the computer is expected to provide to meet user requirements.


The processor is the element of a system that involves the actual transformation of input into output. It is the operational component of a system. Processors may modify the input totally or partially, depending on the specifications of the output. This means that as the output specifications change so does the processing. In some cases, input is also modified to enable the processor to handle the transformation.


The control element guides the system. It is the decision-making subsystem that controls the pattern of activities governing input, processing, and output. In an organizational context, management as a decision-making body controls the inflow, handling, and outflow of activities that affect the welfare of the business.

In a computer system, the operating system and accompanying software influence the behavior of the system. Output specifications determine what and how much input is needed to keep the system in balance.

In systems analysis, knowing the attitudes of the individual who controls the area for which a computer is being considered can make a difference between the success and failure of the installation. Management support is required to secure control and support the objective of the proposed change.


The environment is the “supersystem” within which an organization operates. It is the source of external elements that impinge on the system. In fact, it often determines how a system must function. For example, the organization’s environment, consisting of vendors, competitors, and others, may provide constraints and, consequently, influence the actual performance of the business.


Control in a dynamic system is achieved by feedback. Feedback measures output against a standard in some form of cybernetic procedure that includes communication and control. Output information is fed back to the input and/or to management (Controller) for deliberation.

After the output is compared against performance standards, changes can result in the input or processing and consequently, the output. Feedback may be positive or negative, routing or informational. Positive feedback reinforces the performance of the system.

It is routine in nature. Negative feedback generally provides the controller with information for action. In systems analysis, feedback is important in different ways. During analysis, the user may be told that the problems in a given application verify the initial concerns and justify the need for change.

Another form of feedback comes after the system is implemented. The user informs the analyst about the performance of the new installation. This feedback often results in enhancements to meet the user’s requirements.

Boundaries and Interface

A system should be defined by its boundaries – the limits that identify its components, processes, and interrelationships when it interfaces with another system. For example, a teller system in a commercial bank is restricted to the deposits, withdrawals, and related activities of customers’ checking and savings accounts. It may exclude mortgage foreclosures, trust activities, and the like.

Each system has boundaries that determine its sphere of influence and control. For example, in an integrated banking-wide computer system design, a customer who has a mortgage and a checking account with the same bank may write a check through the “teller system” to pay the premium that is later processed by the “mortgage loan system.”

Recently, system design has been successful in allowing the automatic transfer of funds from a bank account to pay bills and other obligations to creditors, regardless of distance or location. This means that in systems analysis, knowledge of the boundaries of a given system is crucial in determining the nature of its interface with other systems for successful design.

FAQs About the System Concept

What are the components of system?

These are the components of a system:
1. Environment and Boundaries
2. Natural and Human-Made Systems
3. Theoretical Framework
4. Process and Transformation Process
5. Subsystem
6. System Model
7. System Architecture.

What are the characteristics of a system?

Organization, Interaction, Interdependence, Integration, and Central Objective are the characteristics of the system.

What are the elements of system?

Outputs and Inputs, Processes, Controls, Environments, Feedback, Boundaries, and Interfaces are the elements of a system.

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