2. “INFORMATION” VS “COMMUNICATION”
THE BATTLE TO INFLUENCE DECISION MAKING
Information and communications technologies (ICT) have revolutionized the way we work. But do we really understand their organizational
impact? In recent research, Raffaella Sadun, Thomas S. Murphy Associate Professor of Business Administration in the Strategy Unit at
Harvard Business School, argues that, in spite of the shared acronym, the effects of information technologies and communication
technologies should not be lumped together. In fact, their influences within the enterprise not only differ but actually diverge. Better
communication pushes decision making up the organizational hierarchy while better information decentralizes and pushes decisions down,
giving greater autonomy to workers. Sadun talked to MIT Sloan Management Review about whether a more nuanced understanding of these
transformative changes should make us rethink how we view ICT, and the role of leadership in harnessing its value.
The effects of information technologies and communication technologies should not be lumped together. Better communication pushes
decision making up the organizational hierarchy while better information decentralizes and pushes decisions down
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Let’s begin with the relative roles of information and communication technologies. If more information pushes decisions down and better
communication pushes decisions up, is it desirable to focus on one rather than the other? This is something that was initially studied by
Luis Garicano. We tend to conflate technologies that have very different effects on the allocation of decision making authority within the
firm. But if you look more carefully at what these technologies do, you will find very different effects on decision making and where it
happens in a company. Let’s begin with information (or knowledge acquisition) technologies: The easiest starting point is to think about
the technologies that help front-line workers and functional managers gather knowledge that would otherwise be inaccessible to them. In
manufacturing, enterprise resource planning (ERP) software is a good example. It’s a technology that gives the plant manager a
tremendous amount of visibility about what happens elsewhere across the firm, from the supply chain to operations to customer relations
and so on; this information enables them to act much more autonomously.
So to the extent that you can find the skilled employees who complement the technology, and that managers at the top of the hierarchy are
time constrained, it shifts the decision making down in the hierarchy. This is what we consider the empowering effect of knowledge
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Now let’s look at the communication aspect of these new technologies. Think about the role of foreign diplomats before communication was cheap. Countries
would send representatives to foreign territories with a tremendous amount of autonomy. Ambassadors would routinely make decisions that their headquarters —
their countries of origin — wouldn’t necessarily have been able to validate on a daily basis because communication technology was tremendously expensive and
very slow. The diplomat was the only representative of the country who could really understand what was happening on the Raffaella Sadun, Thomas S. Murphy
Associate Professor of Business Administration in the Strategy Unit at Harvard Business School ground, and thus, they were empowered to respond quickly and
independently to events. They were almost like mini-kings.
When communication becomes fast and cheap enough — and right now we are working in a world of instantaneous communication that is virtually free — we
reach a point where it’s more efficient for headquarters to monitor and engage directly.
Communication technology has generated many advantages for individuals, business and society. These advantages include the following:
There is more information available to individuals at a much quicker pace. It presents a means for fast long-distance communication. It
provides a base for mass communication.
There are many advantages of modern means of communication, including Transmission speed:
Messages can be sent or received within a few seconds.
Expansion of coverage areas: the process of communication covered all parts of the world so that the world has become a small
village.Through internet communication, time and money are saved. This is because it is much cheaper and quicker to transfer information
around. It also becomes faster and efficient to contact a business partner or a relative. We can now communicate with anyone around the
world through emails and text messages instantly.
Modern Technology Waste our Time.
Technology Causes Distraction from Work and Study.
Technology Reduce the Creativity of People.
Technology Causes Social Isolation of the People.
Technology Causes Environmental Problems.
Addiction to Technology of the People.