The System in FFVII is good, but flawed. The combat animations are slowed down by high level spells, and a lot of them freeze the time bar, thus allowing no actions to take place. A lot of this could be because of the PS1's limitations, but it also could be because there is room for improvement. Nowadays, i like to play most of my active time RPGs in wait mode, but if you ask me, FFVII's battles need a complete overhaul (among the games many other problems). It is a good system, keeps you engaged, fun to play, and just all around works, but i am actually glad that it was taken out of FF.
i really can't think of a better system without describing FFXII, but i still think FFXII's system is in need of improvement also.
Perhaps im over thinking this. FFVII is a great game, despite all the things i hate it for. And if you ask me, WRPGs are going to take over. Sure, we might still see the turnbased encounters, but they will be a little more down to earth, applying open worlds, interesting survival elements, realized worlds, voiced characters and a little more gameplay freedom. BUt im not saying that JRPGs should do away with their strenghts, like superb stories, great music, a colorful cast of characters that make up your party and strange and new locales.