For definitional purposes, the term, open systems, is a perspective that holds that organizations depend on the external environment for resources, affect that environment through their output, and consist of internal subsystems that transform inputs to outputs (McShane et al., 2022). Open system theory is a biological theory that has been adapted to business organizational structure theories (Leonard 2019). It may seem odd that biology has anything to do with business, but the theory recognizes that any system is assembled by many parts that share resources or data internally, and with its external environment (Leonard 2019). My company, Memphis Light, Gas and Water, is the natio
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For definitional purposes, the term, open systems, is a perspective that holds that organizations depend on the external environment for resources, affect that environment through their output, and consist of internal subsystems that transform inputs to outputs (McShane et al., 2022). Open system theory is a biological theory that has been adapted to business organizational structure theories (Leonard 2019). It may seem odd that biology has anything to do with business, but the theory recognizes that any system is assembled by many parts that share resources or data internally, and with its external environment (Leonard 2019).
My company, Memphis Light, Gas and Water, is the nation's largest three-service municipal utility, serving more than 440,000 customers (MLGW 2023). Since 1939, MLGW has met the utility needs of Memphis and Shelby County residents by delivering reliable and affordable electricity, natural gas and water service. Memphis Light, Gas and Water is supplied with electricity by the Tennessee Valley Authority (TVA), a federal agency that sells electricity on a nonprofit basis. MLGW is TVA's largest customer, representing 11% of TVA's total load, and the agency assists Memphis Light, Gas and Water in supplying electricity for nearly 431,000 electric customers on a daily basis (MLGW 2023).
Memphis Light, Gas and Water operates under an open system because we are owned by our residential and commercial customers, which is considered the major component of the city’s external environment. Memphis Light, Gas and Water is currently undergoing a massive reorganization where strong emphasis is being placed on increased community involvement, customer inclusion, employee engagement/training and technological advancements in the products in which we serve our customers. Even though we are the largest three-tier utility company in this utility sector, our policies and procedures are regulated throughout various internal subsystems for the greater good of our main external stakeholder groups, which are our customers, who are comprised of city and county government employees as well as regular residential and commercial patrons, just to name a few.
The customers are a vital part of our organization’s success because any policy or proposal created by Memphis Light, Gas and Water can positively or negatively impact our customers. In order for our organization to remain sustainable in this sector, our executive board works simultaneously with the city government before any decision is made on any new policy or proposal prior to its implementation. All in all, Memphis Light, Gas and Water is considered the people’s utility company and because of this, our organizational culture consistently adapts daily to the organizational climate of our customers.
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