The Information Processing Theory of Organization

Managing Technology Accession in Complex Systems

John L. Kmetz

• Publisher: Routledge
• Year: 2018
• ISBN:
  9780429780837
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

First published in 1998, revised in 2021, this volume develops and tests an information-processing model of organization, within the context of the accession of a new generation of a production technology. The model conceptualizes organizations as systems which accomplish their objectives through the processing of information. The book begins with the conceptual basis of the theory, developing the fundamental concepts of information, information processing, and technology. The accession of an automatic avionics tester during the 1970s and 1980s is the change in production technology used to test the theory. The theory is tested by mapping and analysing performance with a three-wave longitudinal field experiment and objective performance measures in the workflow of a very complex system, the U.S. Navy's avionics maintenance organization. The information processing capacity of the system is shown to be the primary determinant of system performance, with or without the use of information technology. Additional support for the theory comes from newer test and information technologies deployed in the 1980s and 1990s. Implications of this theory for current generations of test technology are provided in the final chapters, along with further development of the theory and its general application to many types of organizations.

1 Foundations of IPT: the Information Processing Theory of Organization

DOI: 10.4324/9780429433054-1

Introduction

This chapter is written primarily for academics and researchers interested in complexity theory, general systems theory, and information processing theory. There are parts of it which will be difficult to get through and understand without a background in the professional literature, and I apologize for that. On the other hand, many scholars may find my treatment of this material overly brief, but my primary interest is in their applicability to the study undertaken here, and for this material to serve as a framework for some of my own ideas.

After a brief introduction of the general IPT model that will serve as the framework for the study and related topics of this book, we will examine information, information processing (IP), and organizational information processing (OIP), in that order. After these short reviews, more detailed and comprehensive treatment of all these variables will be given in the latter part of the chapter, along with a brief overview of systems and complexity theory.

The General IPT Model

The general model of IPT postulates that organizational performance is the dynamic interaction of information and information processing, within the context of a cybernetic system linked internally and to its external environment by information flows. The general form of the IPT model is:

$$\text{G}\text{=}\text{f}\left(\text{I}\times \text{S}\times \text{C}\right)$$

• where G = Goal attainment (organizational performance),
  I = Information,
  S = Information Processing Structure, including Information Technology,
• and C = Cybernetic System dynamics.

Conceptualizing organizations as streams of information and IP activities, linked dynamically as conceptualized by cybernetics theory and systems theory (hereinafter “cybernetic systems theory”), is a unified way to understand organizational processes and outcomes. In this model, Information interacts with the information processing Structure to form organizational information. Similarly, the information processing structure interacts with the Cybernetic Systems dynamics to form the information processing capacity of the organization. I use the term “cybernetic system” to mean the larger organization within which organizational information is created and used, and also to connote specific properties of systems, explained later in this chapter. Similarly, I use the term “information processing structure” to differentiate it from organization structure. Thus, organization performance is a function of organization information interacting with the capacity to process that information. This model can apply to a single goal, which is unlikely to be the case in most organizations, but can easily be generalized to encompass multiple goals, even in situations where those goals conflict.

At the outset, it should be noted that IPT is concerned with information processing rather than information content. This does not mean that content is immaterial or that it is ignored by the theory. On the contrary, there is one body of content which is requisite to IPT, as will be discussed later in this chapter. However, the model is intended to be general, where the content of information is largely specific to the organization being considered. Content is therefore treated implicitly in most of IPT.

In the foreword to this book I said that I have come to think of IP as the “physics” of organizations. The essential point to recognize at this juncture is that information and IP are related to each other in ways analogous to the dynamic relationship between matter and space-time: matter tells space-time how to curve, and space-time tells matter how to move. One cannot fully comprehend either in isolation from the other.

Much of this chapter will be given to consideration of the basic concepts of information and IP. Interestingly, more work has been directed by earlier contributors to the organization structure and design implications of IP than to these underlying matters. Developing a fuller understanding of these fundamental variables requires consideration of each separately despite their inseparability, but it should always be borne in mind that any partition of them is artificial. Organization design implications are discussed later, but are of less immediate concern than these basic concepts.

Information And Information Processing: Conceptual Groundwork

A number of authors have contributed to the development of the information processing model of organization, including both scholars and practitioners. As Galbraith noted (1977: 24), major earlier contributors were Barnard (1938), Simon (1957), and Cyert and March (1963). Most of the ideas about information processing have emerged in parallel with the development of other concepts of complexity theory and organization during the past 40 years. As is usually the case, these early developments left many pieces incomplete and many concepts poorly defined. Indeed, even the definition of fundamental terms like “information” and “information processing” are not fully explained in these works. Therefore, my first objective in this chapter is to develop more complete definitions of these terms.

Information

For those with either a practical or theoretical interest in information and IP, one of the groundbreaking works in the field was published by Shannon (1948), who wrote a treatise on the theory of information transmission from the engineering perspective of the early telephone and telegraph industry, followed by Shannon and Weaver’s (1949) book. The study of information and feedback processes was also formalized as “cybernetics” theory by Wiener (1948). Cybernetics had considerable impact in both science and philosophy, being used in General Systems Theory as a way to study dynamic relationships between all manner of living and nonliving systems (von Bertalanffy, 1968). Cybernetics concepts have been incorporated into IPT, as will be seen.

1. The telemetry school. Alluisi (1970) points out that Shannon and Weaver and most of the early contributors to information theory gave no consideration to the content of the communication, but were concerned only with the transmission of messages. In recognition of the engineering and telecommunications focus of this early work, I refer to these authors as the telemetry school. The telemetry school focused on the bandwidth capacity and signal clarity of the transmission medium (i.e., “noise” in the transmissions, an engineering problem to be taken literally), so for engineering analysis one needed have no concern over content that was transmitted, only that the method worked, and “signal loss” was the principal criterion to gauge that.
   The telemetry school conceptualized “information gain” to be identical to “uncertainty reduction.” The concept of uncertainty, which is fundamental to much subsequent work in development of information processing concepts, follows directly from the telemetry theorists’ work. By definition, if one gained information, uncertainty was reduced relative to an unspecified previous level of knowledge; in fact, Sayre (1976) referred to “information” as simply a difference between two levels of uncertainty. Interestingly, the telemetry school was concerned with effective communication, but their idea of communication was a primitive view based on closure of a connection—it was assumed that if there was a successful transmission, someone or something on the other end got the message, and thus communication had occurred. The two major legacies derived from the telemetry school are the initial focus on information, and the concept of uncertainty, which is still pervasive in much of our thinking about information and IP.
2. The content school. The question of what was conveyed by information was the concern of the second school of information theorists, the content school. This is a loose aggregation to which I have assigned many subgroups, including information technologists, to whom we owe the conceptual distinction between data and information. Information is not raw data; the computer I am using to write this book manipulates electrical impulses (which we interpret as “1” and “0”), and this is simply meaningless data. By structuring these impulses in a defined way, we convert them into meaningful symbols, an alphabet which I can recognize and use.
   Another subgroup in the content school is concerned with how human beings extract meaning from the streams of data and information they receive. Many of these have contributed to the study of how humans acquire and process information for decision making, as well as for other purposes. I refer to this latter subgroup as the cognitive information processing (CIP) group, of whom we will hear more below.
   Also included in the content school are a large number of communication theorists from the social sciences.¹ One of the early contributions to the study of communication in organizations was the work of Farace, Monge, and Russell (1977). They defined information as “pattern recognition in matter/energy flows.” A stream of symbols lacking any discernible pattern lacks information, which is therefore uncertainty. They also point out that information depends on the perceiver (1977: 23); there are no “objective” patterns which universally constitute information. Among other possibilities, this point addresses a shortcoming found in other models: in the content school, how does one accommodate coded messages when the objective of a code is to communicate accurately on one hand, while preventing those with whom you do not want to communicate, on the other?
3. The psycho-social school. A third subgroup is the psychological or social process school, who argue that the meanings that we receive from information are socially or behaviorally mediated. In this subgroup, the content of information may be socially determined through reference groups, or through culture. Others in this group, including many communication social scientists, argue that much of information is not the content alone, but the interpretation mediated by the context; this group focuses on attributions made to nonverbal and other cues as well as the message itself, i.e., CIP. This group also brings with it a perspective that is often either ignored or unappreciated by many others, and that is the importance of political and interpersonal interactions in determining the content and meaning of information. Most of the theorists who have chosen a political perspective, in fact, are rather isolated from others. The different perspectives within the psycho-social school strongly suggest the reciprocal relationship between information and IP mentioned earlier. If information depends on internal CIP or social or other mediation to become information in the first place, then it is essentially meaningless to consider information in isolation from IP.
   Together, these concepts suggest that information must be conceptualized in a way that takes into account not only the medium by which information is transmitted, or the success of those transmissions in purely telemetric terms, but must also account for the meaning conveyed. Further, since meaning is considerably dependent on the perceiver, the mediating role of the communication process cannot be excluded.

Information Processing

Having considered the concept of “information,” I would like to briefly turn attention to information processing and then combine these within the context of organizations. As I mentioned, IP has received more theoretical and applied attention than the concept of information. However, that does not mean that the concept of IP is necessarily more completely developed or integrated into the literature than “information.” In fact, IP has fared little better in this regard.

Information do...

Table of contents

• Cover Page
• Half Title Page
• Title Page
• Copyright Page
• Dedication Page
• Original Title Page
• Original Copyright Page
• Contents Page
• List of Figures Page
• List of Tables Page
• Acknowledgments Page
• List of Abbreviations Page
• Foreword Page
• 1 Foundations: Systems, Complexity, and the Information Processing Theory of Organization
• 2 Avionics Maintenance and Technology Accession
• 3 VAST and Avionics Maintenance
• 4 The VAST Shop Effectiveness and Efficiency Studies
• 5 Coping with Complexity in the Avionics Maintenance System
• 6 “Experiment 2”—IP Capacity, Organization Performance, and Organization Slack
• 7 New Technologies and “Experiment 3”
• 8 Extending IPT, ATE Lessons, and a Technology Accession Model
• Postscript and Post-Analysis, 2021
• Photo Appendix
• Index