System software includes your operating system and the utility programs that help manage the computer. The operating system handles communication between your programs (applications) and the hardware. Without an operating system, your computer can do little more than light the screen up with a message.
The operating system makes the applications take turns using the processor, giving each one a number of time slices based on how important that task is. Background tasks get less time that the foreground task. It also manages the flow of data in and out and how memory is used. It includes at least basic file and disk management and security features and can measure its own performance in several ways.
Some operating systems allow only one program to run at a time, like some smart phones and tablets. Others can handle multi-tasking, like normal desktop computers do. Windows is currently the most popular operating system for desktop computers. Other operating systems are popular for smart phones and tablets, especially the iPhone and iPad operating systems. All operating systems will eventually stop receiving updates, especially security updates.
Utilities often come with the operating system but third-party companies try to create programs that work better or do more. Often included with the operating system are defragmenting, backup and recovery, memory management, and data compression. Security software is needed to keep your computer free from malware like viruses, trojans, and worms.