Subsystem: Definition & Explanation

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  • 0:01 Subsystem Defined
  • 0:53 Business Examples
  • 2:10 Lesson Summary
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Lesson Transcript
Instructor: Dr. Douglas Hawks

Douglas has two master's degrees (MPA & MBA) and a PhD in Higher Education Administration.

In this lesson, you will learn how to identify a subsystem and why it is important to define each subsystem within an organization. Then, test your knowledge with a quiz.

Subsystem Defined

A system is defined as an assemblage or combination of things or parts forming a complex or unitary whole. It's important to understand the difference between a process and a system. Business processes occur within a business system. Processes are an organized set of steps intended to take some input and generate a desired output. Systems don't generate outputs, but they provide the structure and environment within which a process can reside.

A subsystem, while a system in itself, is also wholly contained within a larger system. An online retailer may have a complex and extensive distribution system and within that system would be subsystems, such as delivery, order fulfillment, and inventory management.

Business Examples

You may have heard the term 'system' used to describe specific parts of a business, such as a distribution system or an information technology system. Both of these reside within a larger system - the organization of which they're a part - and even the organization is part of a larger economic system.

A distribution subsystem includes the people, processes, equipment, and policies that exist to distribute products or services from an organization to individual customers. These components might include delivery trucks, an order entry process, inventory, and employees to make it all happen.

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