Information management refers to the application of management principles to the acquisition, organization, control, dissemination, and use of information relevant to the effective operation of organizations (Wilson 1997). Information management is critical to organizational performance. Therefore, organizations continuously strive to improve information management, both within organizational boundaries and with external partners. As a result, organizations select different configurations to align information requirements to information availability. In this section, I discuss key theories on information management that relate to this alignment.
3.2.1 Information Processing Model (March and Simon 1958; Galbraith 1974, 1977) Drawing on March and Simon (1958), Galbraith analyzed the complexity of information processing in organizations (1977, p36). Galbraith considered the relationship between task uncertainty and variation in organizing modes and proposed a model linking organizational performance to information processing. The model suggested that, the greater the task uncertainty, the greater the amount of information that must be processed among decision makers during task execution in order to achieve a given level of performance. Galbraith argued that the basic effect of uncertainty was to limit the ability of the organization to preplan or to make decisions about activities in advance of their execution (1977, p36). While Galbraith’s concept of uncertainty referred to a lack of information, he defined uncertainty differently from the telemetry school and considered it a general problem of meaning within the context of organizations (Kmetz 1998, p6). Galbraith argued that uncertainty is not inherent in the task, and therefore task analysis alone cannot determine the degree of uncertainty. He considered uncertainty to be the difference between the amount of information required to perform the task and the amount of information already possessed by the organization (1977, p37). Accordingly, two factors determine the information required for a task: 1) the nature of a task, in terms of diversity of goals and the internal diversity of the organization and 2) the level of performance
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 47 required. Thus, greater task uncertainty requires greater need for information, and higher level of organizational performance necessitates considering more alternatives, more variables, and more variables simultaneously (1977, p37).
Based on this argument, Galbraith (1974; 1977) proposed two general design strategies by which organizations can fill the information processing needs created by uncertainty. First, the organization can reduce the need for information processing by creating slack resources and by creating self-contained tasks. Second, the organization can increase the capacity to process information by building vertical information systems and by developing lateral relations. Galbraith’s model was the first to explicitly consider an organization’s performance in relation to its information processing needs (Kmetz 1998, p6).
3.2.2 Information Contingency Models (Daft and Lengel 1986; Daft and Macintosh 1981; Tushman and Nadler 1978)
Tushman and Nadler (1978) built on the view of organizations as information processing systems and extended this concept to develop a model of organizational design and structure. They adopted the contingency-theory concept of “fit” between organizational components and processes and argued that an organization is more effective when its information processing requirements match its information processing capacity. They suggested that uncertainty facing organizational units was a product of three groups of variables—sub-unit task characteristics, sub-unit task environment, and inter-unit task interdependence—which determined the organization’s information processing requirements. Based on the information processing capacity of organizational sub-units, complexity of information processing requirements, and cost considerations, they suggested structures (such as rules and procedures, planning and control systems, and product teams) to coordinate activities of interdependent sub-units.
Drawing on organization theory, Daft and Lengel (1986) discussed two basic requirements to organizational information processing: task uncertainty and task equivocality. In distinguishing between uncertainty and equivocality, they argued that the principal underlying reason for organizational information processing was the need to cope with these two informational problems. Hence, Daft and Lengel differentiated Galbraith’s (1974; 1977) concept of uncertainty from Weick’s (1979) concept of equivocality. Galbraith referred to uncertainty as absence of
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 48 information. Thus, as additional information becomes available, uncertainty decreases. Weick defined equivocality as essentially synonymous with ambiguity—the existence of multiple and conflicting interpretations about an organizational situation (Daft and Macintosh 1981; Weick 1979). High ambiguity suggests confusion and lack of understanding but not lack of information. Thus, additional information is unlikely to reduce equivocality. From an information management perspective, Daft and Lengel’s (1986) framework suggests a strategy in which an organization uses existing workflows to maximize information availability (and thus deal with uncertainty). Further, the framework suggests another strategy wherein the organization develops new workflows by incorporating information systems and developing relationships with internal and external partners to improve analytical capability (and thus deal with equivocality).
3.2.3 Organizational Structuring Model (Mintzberg 1979; 1980)
Similar to Galbraith (1974; 1977), Mintzberg argued that information processing requirements determine organizational structures. He suggested a typology of four ideal-type configurations of organizational structures based on coordination mechanisms required for different types of information processing: 1) simple structure, 2) machine bureaucracy, 3) professional bureaucracy, and 4) adhocracy. In addition, he suggested a fifth form—the divisionalized structure—in which any of these four forms can exist as sub-units of a superstructure. Drawing on Mintzberg (1979; 1980), we discuss these briefly here:
• A simple structure emerges in an environment characterized by low complexity and high uncertainty. It requires a high degree of centralization and direct supervision as the main coordinating mechanisms.
• A machine bureaucracy emerges in an environment characterized by low complexity and low uncertainty, as is the case in large organizations. It requires limited decentralization with standardized work processes.
• A professional bureaucracy emerges in an environment characterized by high complexity and low uncertainty. It involves work among autonomous specialists who achieve coordination through standardization of skills.
• An adhocracy emerges in an environment characterized by high complexity and high uncertainty. It emerges when “the organization is structured into work constellations to
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 49 which power is decentralized selectively and which are free to coordinate within and between them through mutual adjustment” (Mintzberg 1980). Here, the need for collaboration in decision-making is high, owing to the expertise of the support staff. • Finally, a divisionalized form emerges as autonomous, market-based units within an
organization that can control their own decisions. It exists as an aggregate superstructure that can split into sub-units according to custom, geography, product category, or as a solution to a specific problem. Coordination among such units occurs through standardization of outputs (Mintzberg 1980).
From an information management perspective, Mintzberg’s (1979; 1980) framework can inform organizational design strategies, as shown in Figure 3.2-1. Accordingly, a machine bureaucracy is suitable for tasks with low uncertainty and complexity; an adhocracy can provide decentralized decision making for tasks with high complexity and uncertainty; a professional bureaucracy is suitable for tasks with high complexity and low uncertainty; and a simple structure is suitable for tasks with low complexity and high uncertainty.
Figure 3.2-1 Mintzberg’s Organizational Structuring Model
Organizational Structuring Model (Mintzberg 1979; 1980)
3.2.4 Information Production and Consumption Model (Ramaprasad and Rai 1996) Ramaprasad and Rai (1996) suggested an information management model based on two continuous, complementary processes that are critical to organizational performance: 1) production (they used the term “generation”), which refers to creating information about an organization (for example, about entities or processes), and 2) consumption (“dissipation”), which refers to creating organization from information (for example, decision making, plan
Adhocracy Simple structure Machine bureaucracy Professional bureaucracy High Low High Low Uncertainty C om p le xi ty
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 50 formulation, and implementation). They proposed that, in effective organizations, there is a symbiotic relationship between information production and consumption. Thus, actors produce information about business phenomena by deriving meaning from stimuli in the organization and its environment. At the same time, actors consume information when they transform it into stimuli that support and guide organizational action.
Further, Ramaprasad and Rai (1996) suggested that any mismatch between production and consumption reduces organizational performance. Therefore, an organization must ensure that the information production-consumption cycle is positively reinforcing and that production and consumption are balanced. They argued that “a positively reinforcing cycle will result in a continuously learning, effective organization; a negatively reinforcing cycle will result in a decadent, ineffective organization.” Therefore, a cycle in which production and consumption are balanced is functional; lack of balance manifests itself as dysfunctionalities such as information overload, information in jail, and misinformation. Figure 3.2-2 depicts these four scenarios showing complementarity of information production and consumption in an organization.
Figure 3.2-2 Information Production and Consumption Scenarios Information Production and Consumption (Ramaprasad and Rai 1996)
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 51 3.2.5 Organizational Information Services Model (Mathiassen and Sørensen 2008)
Mathiassen and Sørensen (2008) built upon existing theories of information management (Daft and Lengel 1986; Galbraith 1974; 1977; Mintzberg 1979; 1980; Ramaprasad and Rai 1996) and adopted information processing as an integrating concept in organizational design. Combining the notions of information processing options and information processing requirements, Mathiassen and Sørensen (2008) outlined a contingency theory that explains how organizations design, consume, and provide information services. They suggested that information exists as services in organizations, which enact in response to specific information processing requirements to support work, communication, and decision making within and across organizational boundaries. Further, they suggested that information services occur as heterogeneous portfolios of information processing capabilities enabled by people and IT. Organizational actors evoke these information services to execute tasks.
Drawing on the concepts of uncertainty and equivocality (Daft and Lengel 1986; Daft and Macintosh 1981; Tushman and Nadler 1978) and on Mintzberg’s organizational structuring model (1979; 1980), Mathiassen and Sørensen (2008) distinguished between different types of information processing. Considering uncertainty, they suggested that some types of information processing focus on using readily available information (which involves low uncertainty), while other types of information processing focus on producing new information (which involves high uncertainty). Considering equivocality, in some cases, an organization can process available information in a straightforward and standardized manner (which involves low equivocality), thereby allowing the organization to develop standardized approaches across many tasks. In other cases, the involved actors can have diverging or even conflicting interpretations of a given situation (thereby involving high equivocality) which requires close interaction and dedicated analytical effort to resolve the problem. Following this line of thinking, and drawing on Galbraith’s (1974; 1977) Information Processing Model, Mathiassen and Sørensen (2008) proposed that a fit is necessary between information requirements (which includes uncertainty and equivocality) and the portfolio of available information services that enable delivery of business services to the customer. Figure 3.2-3 shows the various types of information services.
Singh | Dissertation | INFORMATION MANAGEMENT THEORY 52 Figure 3.2-3 Organizational Information Services Model
Organizational Information Services (Mathiassen and Sørensen 2008)
The computational information services in Mathiassen and Sørensen’s (2008) framework represent day-to-day processing of work that is low in equivocality and uncertainty; adaptive information services represent high equivocality and low uncertainty; networking services represent low equivocality and high uncertainty; and collaborative information services represent high equivocality and uncertainty.
Most of these theories of information systems rely on contingency models and have common underlying assumptions of information requirements, information processing, and organizational design options. Next, we discuss limitations of these theories in explaining information management in complex organizational settings.