Information is the raw material of managerial work. The daily activities of managers involve the processing of information. In order to arrive at decisions within organizations, managers interpret the external environment, co-ordinate internal activities, handle problems, participate in meetings, and send and receive reports (Daft and Macintosh, 1981; Daft and Huber, 1987). These are all information-processing activities.
The processing of information demands the use of communication media. Since the early 1990s, companies have relied increasingly on new communication technologies to improve their performance (Davenport, 1997). This trend can be observed across various countries and in companies of different sizes. There are two major reasons for this increased emphasis on communication technologies within organizations. The first is that managers spend 70–80 per cent of their time managing information, using a wide range of communication media (Mintzberg, 1973). The time allotted to this task has been validated for both industrialized (Kurke and Aldrich, 1983; Mintinko and Gardner, 1990) and developing countries (Montgomery, 1986). In addition, with the introduction of new communication technologies, the effective and efficient use of the increased number of communication media has become an ever more difficult task. According to Davenport et al. (1992, p. 53) ‘broadening information access and usage and enhancing the quality [of information exchange] are key to improving business performance’. Although this argument sounds convincing, Malhotra 1997 noted that, despite an investment of $1 trillion by US companies, little improvement in the efficiency and effectiveness of information management through the usage of new communication technologies has been realized.
With the introduction of new communication technologies the basic economic laws of information processing are changing. The ability to unbundle information from its physical carrier is having an impact on the trade-off between ‘richness’ and ‘reach’ (Evans and Wurster, 1997). Richness refers to the amount of information that can be transferred and its ability in changing human understanding – for example, voice mail is less rich than face-to-face communication, since it does