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Managing Organizational Interfaces:The Information Technology Factor
May 1993 CISL WP# 93-04
Constantin LangStuart E. Madnick
Stuart Madnick, E53-321
Sloan School of ManagementMassachusetts Institute of Technology
Cambridge, MA 02138
TABLE OF CONTENTS
PageChapter I. INTRODUCTION ......................................................................................... 1
1.1 Thesis Topic.....................................................................................................11.2 Thesis Questions and Hypothesis.................................................................. 11.3 Thesis Overview........................................................................................... 1
Chapter II. THE INTERFACE FRAMEW ORK............................................................... 32.1 Motivation for New Framework.................................................................... 32.2 Presentation of Framework........................................................................... 42.3 The Importance of Interfaces........................................................................ 62.4 Presentation of Related Frameworks............................................................. 6
2.4.1 Interdependence Frameworks.......................................................... 72.4.1.1 Thompson's Interdependence Model................................. 72.4.1.2 Kelley's and Thibaut's Interdependence Model................. 82.4.1.3 McCann's and Ferry's Interdependence Model................... 8
2.4.2 Human Resource Oriented Frameworks.......................................... 92.4.2.1 External Boundaries........................................................ 92.4.2.2 Boundaries around Groups ............................................... 92.4.2.3 Boundary Management.................................................... 9
2.5 The Interface Model Revisited ...................................................................... 102.6 Treating Interfaces....................................................................................... 13
Chapter III. MANAGING INTERFACES....................................................................... 153.1 Overview ..................................................................................................... 153.2 Interface Abolition....................................................................................... 15
3.2.1 Core Competencies......................................................................... 153.2.2 Empowerment................................................................................. 15
3.3 Interface Redesign......................................................................................... 153.3.1 Business Re-engineering.................................................................. 163.3.2 Outsourcing ..................................................................................... 16
3.4 Interface Smoothing..................................................................................... 163.4.1 Time Based Competition................................................................. 163.4.2 Lean Production............................................................................. 17
3.4.2.1 Just-in-Time......................................................................173.4.2.2 Total Quality Management.............................................. 17
3.4.3 The Learning Organization............................................................ 17Chapter IV. CONCEPTUAL INTERFACE DESIGN ........................................................ 18
4.1 Choosing the Right Coordination Strategy ................................................... 194.1.1 Basic Coordination Strategies........................................................ 19
4.1.1.1 Markets, Hierarchies and Networks ................................ 194.1.1.2 Organic vs. Mechanistic Strategies.................................. 194.1.1.3 Mintzberg.........................................................................19
4.1.2 Determining the Strategy.............................................................. 194.1.2.1 Classicists....................................................................... 204.1.2.2 M arkets, Technology and Task Predictability................... 204.1.2.3 Structure Driven Choice.................................................. 20
4.2 Choosing the Right Coordination Mechanism ............................................... 214.2.1 Basic Coordination Mechanisms...................................................... 21
4.2.1.1 Mechanistic Mechanisms .................................................. 214.2.1.2 Organic Mechanisms........................................................ 22
4.2.2 Determining the Coordination Mechanisms..................................... 224.2.2.1 Theories with one conditioning variable for the choice of the
means of coordination................................................................ 224.2.2.1.1 Task Uncertainty ............................................. 224.2.2.1.2 Interunit Conflict ............................................. 23
4.2.2.2 Theories with multiple conditioning variables for the choice ofthe means of coordination.......................................................... 25
4.2.2.2.1 Task Uncertainty and Degree of Interdependence....254.2.2.2.2 Degree of Interdependence and Amount of Conflict..254.2.2.2.3 Differentiation, Interdependence and InterunitC onflict ........................................................................ 25
Chapter V. CHOOSING THE RIGHT TECHNOLOGY ................................................... 275.1 Basic Communication Technologies................................................................27
5.1.1 Types of Communication ................................................................ 275.1.2 Traditional Means of Communication..............................................28
5.1.2.1 Interpersonal Communication.......................................... 285.1.2.1.1 Face-to-Face and Meetings ................................ 285.1.2.1.2 Printed Interpersonal Media..............................28
5.1.2.2 Machine Assisted Communication ................................... 285.1.2.2.1 Telegraph & Telephone ................................... 285.1.2.2.2 Fax & Teletext..................................................29
5.1.3 Computer Mediated Communication Technologies ........................... 295.1.3.1 The Importance of the New Media ................................... 295.1.3.2 Communication Means for Unstructured Information.......29
5.1.3.2.1 Voice Mail....................................................... 295.1.3.2.2 Audio Conferencing ........................................... 305.1.3.2.3 Video Telephone...............................................305.1.3.2.4 Video Conferencing ........................................... 305.1.3.2.5 Satellite Conferencing...................................... 305.1.3.2.6 Email .............................................................. 305.1.3.2.7 Bulletin Board Systems.....................................305.1.3.2.8 Computer Conferencing..................................... 30
5.1.3.3 Communication Means for Structured Information............. 315.1.3.3.1 Database Systems.............................................315.1.3.3.2 Client Server ................................................... 31
5.2 Determining the Right Technology................................................................315.2.1 Media Richness Theory .................................................................. 325.2.2 Social Influence Model of Media Choice......................................... 325.2.3 A Contingency Model of Information Technology Choice .................. 335.2.4 Implications of the Interface Model............................................... 33
Chapter VI. A CASE STUDY OF AN ALUMNI ORGANIZATION................................. 376.1 Data Collection Method............................................................................... 376.2 Alumni Related Activities........................................................................... 37
6.2.1 Activities Involving Alumni.......................................................... 376.2.2 Groups Concerned about Alumni...................................................... 376.2.3 The Alumni Database (ADDS)........................................................37
6.3 Resource Development.................................................................................. 386.4 Activities of the Schools...............................................................................386.5 Alumni Association.......................................................................................38
6.5.1 Organization of the Alumni Association..........................................386.5.2 Interfaces between the Units of the Alumni Association...................39
6.5.2.1 Information Interfaces..................................................... 406.5.2.2 Psychological Interfaces ................................................. 41
6.5.3 Interface Management .................................................................... 436.5.3.1 Conceptual Interface Management................................... 43
6.5.3.1.1 Choosing the Right Coordination Strategy ...... 43
6.5.3.1.2 Choosing the Right Coordination Mechanism........436.5.3.2 Choosing the Right Interface Technologies.......................43
6.6 Interfaces between Schools and Information Systems Group............................ 46Chapter VII. CONCLUSION.........................................................................................47APPENDIX: Logical Flow of the Thesis ........................................................................ 48BIBLIOGRAPHY...............................................................................................................49
ABSTRACT: This thesis develops a new organizational model of interface management. Thefundamental claim of the framework is that concentrating management efforts on the exchangeof matter, information and feeling within an organization will yield the highest performanceimprovements. The framework is in line with previous research in organizational behavior andthe methods of interface abolition, interface redesign and interface smoothing capture most ofthe features of the existing and ever emerging new buzz-word management philosophies.
Communication and information technology choice can be explained with the help of theinterface model. The message of the model is that technologies must be in accordance with thefeelings and the information exchanged between the units. In the case of non-correspondenceimprovement can come from a change in the feelings and the information or through theadoption of a different technology. A case study of the Alumni Association of theMassachusetts Institute of Technology is used to show how the model can be used as amanagerial tool.
Chapter I. INTRODUCTION
1.1 Thesis TopicStudents, professors and managers have to deal with an increasing number of managementphilosophies. Every new management "guru" claims to have discovered the essence of effectivemanagement. This thesis tries to develop what one might call a 'meta model' of management. Amodel that puts ideas such as lean production, core competencies and many others into oneperspective. This new model is called "Interface Management".
In a first part the thesis will show how this new model relates to existing theories and to manyof those emerging popular management philosophies. In a second part of the paper a refinedinterface model is used to analyze the choice of communication and information technologies. Acase study of the MIT Alumni Association will demonstrate that the model's descriptive andnormative qualities can explain organizational problems and help managers find solutions.
1.2 Thesis Questions and HypothesisThis thesis will try to answer the following two questions:e Is there a common denominator for the majority of new management philosophies and if
so, what does this mean for management ?e How should information systems be designed in order to be an effective tool for
supporting the ideas of the new management philosophies ?In order to answer the questions mentioned above this paper will discuss the following fourhypothesis :e All buzz-word philosophies rely on interface management and interface management is
the most important element in these theories.e The interface approach represents an effective instrument for analyzing organizations.e Organizations must choose information technologies which match the interface
supported by the technology.e The interface model helps managers to choose the optimal information and
communication technologies.
1.3 Thesis OverviewThis thesis will describe a new managment framework based on interfaces, show how it relatesto current management thinking and elaborate on the treatment of interfaces. It will discusshow organizations should design interfaces and go about choosing interface technologies. Figure1-1 gives a schematic overview over the proceedings of the paper (see also appendix).
The second chapter of this thesis will discuss some of the motivation behind the developmentof a new framework. The Interface Management framework will be presented and related ideasfrom the research community will be introduced. The chapter will conclude with a detailed
description of the new framework and its use in organizations. Chapter three will demonstratehow the Interface Management framework captures the main ideas of a number of popularmanagement philosophies. The techniques of interface abolition,
Agents Interfacel Agents
( Chapter 2)
Interface Abolition Interface Redesign Interface SmoothingCore Competencies Business Reengineering - Time Based CompetitionEmpowerment -Outsourcin gl Lean Production
-Leaming Organization
1 face Manageme
(Chapter 3)
Perfect Interface
4IInformation and Communication Technologies
Technology Chol
( Chapter 5)
Coordination Strategie Coordination Mechanisms
Conce tual Interface Desi
( Chapter 4)
Figure 1-1: Thesis Outline
interface redesign and interface smoothing will be described and related to current managementthinking.
From chapter four on the thesis will focus on psychological and information interfaces. Startingfrom the notion of the existence of a perfect information interface, the remainder of the thesiswill discuss how organizations can determine the right design of interfaces and the bestinterface technologies. This establishes an objective that can be achieved by using acombination of the Interface Management methods. Conceptual interface design methods willbe discussed in chapter four. These methods combine essentially the choice of theorganizational setup and of the coordination mechanisms employed. Chapter five will start
with an overview of available information and communication technologies, that anorganization can employ at its interfaces. After an overview of media choice theories, thethesis will show how the Interface Management framework can be an effective tool for mediachoice.
A case study of the Alumni Organization of the Massachusetts Institute of Technology willshow in chapter six how the new framework can be used in organizations and how it can help toexplain some of the problems occurring in the Alumni Organization.
Chapter II. THE INTERFACE FRAMEWORK
2.1 Motivation for New FrameworkThe 1990s will be the decade of increased global competition. The former communist countrieswill enter the world market, new south-east Asian countries will emerge as economic dragonsand the economic battle in the triad will intensify (Thurow, 1991). America will begin to feelthe negative effects of inferior productivity (Krugman, 1990) and the increasing speed ofproduct development in Japan (Womack, 1990) will lead to decreasing product life cycles.Against this background Madnick (1990) identifies four major challenges that companies facetoday: (1) An increasing globalization of business and (2) the emergence of worldwidecompetition, (3) the requirement to improve productivity and (4) an increasing volatility of thebusiness environment.
A large number of management philosophies has developed over the last decade to helpcompanies face these challenges (Figure 2-1). Managers today are confronted with a seeminglyendless float of new management ideologies. To effectively deal with the global challengesmodern management practice has produced a number of strategies. Cross border alliances, jointventures, strategic alliances and the acclaimed Japanese Keiretsu practice have all oneunderlying objective. All these strategies attempt to improve the ways companies shareresources across borders and across different companies.
Globalization/ Productivity VolatileCompdwdet Requirements Environment
Asset Allocation Just-.In-Time High Perf. InvolvementCross Border Alliances Lean Produciton EmpowermentJoint Venture MRP DownsizingKeiretsu Total Quality Mangement Teams/WorkgroupsConsolidation Time-Based-Competition Learning OrganizationStrategic Alliances Core Competencies Continouos improvement
Capabilities Based Competition Organizational FitOutsourcingBusiness Re-engineering
Interface Management
Figure 2-1 New Challenges and Proposed Solutions
Industrialized countries' survival will partly depend on their ability to maintain a level ofproductivity superior to newly industrialized countries and third world countries. As labor costsare far higher in the industrialized world it is important that the output per labor hourremains equally high. Countries such as Germany for example have performed extremely welldespite high labor cost, because of their high productivity levels. The management theorists of
the last decade have pointed out a number of areas in which productivity can be improved.Lean productioni, Just-in-Time concepts and bottleneck management try to improve the flow ofgoods through the company. Improvement mainly stems from stressing the system and squeezingout existing slack. One main objective is to reduce the amount of work-in-process inventory. Wecan interpret this as trying to improve the productivity per capital tied up in inventory. Totalquality management tries to reduce the number of faulty parts, thus increasing the productivityper unit of raw material. Time-based-competition can be interpreted as getting rid of time slackthus increasing productivity per hour. Companies also have to increase their productivity peractivity. The theories of core competencies and Capability-Based-Competition and outsourcingtry to make companies focus on those activities that are truly worth investing in. BusinessProcess Re-engineering is one of the newest stars in the list popular management ideas. Itimplies that companies should no longer focus on markets and products but on the processesinvolved in making business. In other words, the focus shift intends to increase the productivityper process.
The third main challenge comes from the increasing volatility of the business environment.Product life cycles get shorter, technological change accelerates and political as well aseconomical settings are in a period of extreme change. The increasing volatility of the businessenvironment requires high flexibility. Business experts respond with a multitude ofphilosophies. Downsizing, empowerment and teamwork are concepts which try to flatten theorganizational hierarchy by giving more responsibility to the people who work in the field.This, the experts hope, will increase a company's overall flexibility. The ideas of the LearningOrganization and Continuous Improvement similarly try to emphasize the importance of thecompany's ability to react to change. The better the organization can learn and the better themomentum of change the higher are the company's chances of adapting to new environments.
2.2 Presentation of FrameworkWhen taking a closer look, however, one will realize two astonishingly simple facts. First, onerealizes that many buzzwords essentially express similar well known ideas. Who can make areal difference between 'Empowerment' and 'high performance involvement' and where is theconceptual difference between 'Cross Border Alliances' and 'Strategic Alliances ? While it isnot the purpose of this paper to question the creativity of the business research community, thesecond surprise is more meaningful to this thesis. It is that most of these philosophies have oneunderlying theme : The Management of Interfaces consisting of interface abolition, interfaceredesign and interface smoothing (Table 2-1).
Interface Interface Redesign Interface SmoothingAbolition
e Core e Business Re- e Time BasedCompetencies engineering Competition
e Empowerment e Outsourcing a Lean Productione Learning
Organization
Table 2-1 Interface Management Interpretation
Before we examine the relationship between some of the popular management philosophiesand the Interface Management framework in more detail, it is essential to describe the ideasbehind the new concept. Any organization can be viewed as a collection of agents. There are twobasic types of agents which are the human being and the machine. However, agents can also bea set of smaller agents distinguished by, for example, local proximity, shared goals, values andnorms or similar tasks. Such agents are for example divisions, customers, suppliers or a group ofmachines. From this perspective agents are somewhat similar to territorial entities (Lee, 1992),
1 See chapter three for a more detailed discussion of some of these concepts.
which are self-centered, share resources internally and have a limited span of interest.Contrary to territorial entities the interface model's 'agent groups' do not necessarily require anindependent decision making capability, since machines are also considered to be agents. Thismakes the interface model more general.
Psychological
Interfaces
Inforrnation Material
Figure 2-2 : The Interface Framework
It is the fundamental principle of division of labor that requires agents to work together in anorganization. Agents have to contact each other to make division of labor possible. The pointsof contact between the agents shall be called interfaces. Division of labor requires the exchangeof matter, with goods flowing through the transformation process. Secondly information must beexchanged mainly for coordination purposes (sometimes, as in the case of a brokering firminformation can be the actual good). Exchange of matter and exchange of information areessential for the functioning of an organization. However - maybe unfortunately for theorganization, but certainly to the benefit of mankind - humans also exchange feelings whenthey enter into contact. Thus at the points of contacts agents can exchange basically three thingswhich are matter, information and feelings. As a result the proposed framework (Figure 2-2)distinguishes, according to what is exchanged, three kinds of interfaces : Psychologicalinterfaces, material interfaces and information interfaces. Psychological interfaces describethose relations between agents of an organization that are guided by the agents inner feelingsabout the other agent and the work involved. Psychological interfaces are the points ofconnection, where feelings are exchanged. This can be done through voice, but also through signlanguage or a particular behavior. Material interfaces describe the points of contacts betweenagents, where physical matter is exchanged. One obvious example are work in processinventories. Here output from one work station is turned over to the next function in line.Information interfaces finally describe the ways information is given from one agent to another.These interfaces can be very simple such as face-to-face contacts or they can be supported byhighly sophisticated information and communication technologies, such a video conferencingand distributed data bases. Clearly, psychological, material and information interfaces canoccur simultaneously.
Interfaces do not only occur within an organization, but also between the organization and itsenvironment. External interfaces refer to the relationships a company has with its surroundingenvironment. Every company must manage the way it does business with customers andsuppliers, every company should care about competitors and allies and every company must alsotake into consideration the interplay of its actions and the reaction of the public, institutionsand the owners of its capital. Internal interfaces on the other hand refer to the points of contactthat exist within an organization. How, where and when do interactions between variousbusiness units or divisions occur? How do employees and management communicate ? How arethe different elements of the value chain linked to each other ? All these points of contact arecritical in the performance of a company and should therefore be managed with great attention.
Before we take a look at similar frameworks that have been proposed by the research
community, we have to answer the question, why interfaces are actually so important.
2.3 The Importance of InterfacesAny organization trying to improve its performance has essentially two options : Improvementof agents or improvement of interfaces. Organizations try to improve human agents throughmeasures such as training, new hiring policies or ameliorated incentive systems. The singleemployee will thus work more efficiently towards the goal of the organization. Machineagents, on the other hand, can be improved through replacement of old machines by faster, morepowerful and more flexible equipment. Organizations have understood since long thatinvestment is a key to survival and thus the adoption of new technologies and the quality ofhuman of agents have been recognized as important issues. However, it seems to be difficult togain lasting competitive advantage through investment in agents. Other organizations can buysimilar machines and human employees can be hired away by the competition.
Effectively managing and improving the organization's interfaces is the second approach toperformance improvement. In effect, the improvement of agents will often have to be followedby a modification of the interfaces surrounding the agent. Simply putting in place a faster robot,for example, will increase the performance of the machine agent, but not necessarily theperformance of the organization. A bottleneck at another location may still slower down thetransformation process. As a result the faster robot may only create more work-in-processinventory leading to higher capital costs. Managing the interfaces around the new robot wouldprovide a smooth flow of the goods so that the increased efficiency of the agent is translatedinto increased efficiency of the whole organization.
Interfaces are not a new concept, but the interface concept is slowly being used in a broadercontext. The term "interface was originally used in computer science to describe a connectionbetween programs or program modules. Today computer scientists readily talk about userinterfaces to describe the way a user can interact with a machine. Malone (1985) defines'organizational interfaces' as "...the parts of a computer system that connect human users toeach other and to the capabilities provided by computers". He argues that organizationalinterfaces will become increasingly important for two reasons. First, the impeding growth oflocal area networks and other telecommunications facilities will stipulate a flood ofinterpersonal computer applications such as electronic computer conferencing. In addition, thedecreasing costs of hardware will shift the focus of information technologies from single userprograms to applications that are fit to serve the organizational challenges. Malone's mainfocus is on information technology related interfaces and their increasing importance. Othershave recognized the importance of managing other kinds of interfaces as well. Hammer (1990)argues that "many of our job designs, work flows, control mechanisms, and organizationalstructures came of age in a different competitive environment" 1. In addition, chapter three ofthe thesis will show that many of today's most popular management philosophies effectivelyattempt to improve interfaces. In the future investment in machines and humans will still be anecessary condition for success, but it will not be sufficient.
One of the underlying assumptions of this thesis is therefore that effectively managinginterfaces will be a most critical element for the survival and success of organizations. Ifmanagers adopt this interface view they can concentrate on the essential and much of theconfusion due to abstract organizational theories can be avoided.
2.4 Presentation of Related FrameworksOrganizational theorists have realized a long time ago that one of the basic challenges ofmanaging an organization consisting of a large number of people is the integration of theiractivities. The following section will describe two streams of managerial thought that haveaddressed this problem: Interdependence frameworks and human resource oriented approaches.
1 Hammer, 1990, p. 104
2.4.1 Interdependence FrameworksThe interdependence models focus on the business nature of the relationship between work units.Interdependence exists essentially when two or more work units have to work together tobenefit from division of labor.
2.4.1.1 Thompson's Interdependence ModelThompson (1967) proposes a framework for establishing the appropriate linking mechanismsbetween interdependent parts of a company. He defines three types of interdependence betweenvarious units of an organization:e Pooled Interdependence : Pooled interdependence exists between units that operate
independently but are part of the same organization and therefore share scarceresources. Branch banks, for example, located throughout a city may run essentiallyindependently of each other except for the common sharing of advertising andmarketing resources. Units with pooled interdependence have a minimal amount ofcoordination and linking requirements.
* Sequential Interdependence : Sequential interdependence occurs between units that arelocated on consecutive stages of the value chain. In a chemical plant, petroleumderivatives must move through different production units until an end product such aspolypropylene is ready. Groups that have sequential interdependence need closecoordination and timing so that work flows remain smooth and uninterrupted.
e Reciprocal Interdependence: In the case of reciprocal interdependence each group mustwork with each other in the production of a common product. In an advertising agency,the media, creative, and account services areas must work closely with each other inthe development of ad campaigns for their clients. This form of interdependenceimposes substantial coordination and problem-solving requirements between units.
Thompson argues that the types of interdependence follow a Guttmann scale: Sequentialinterdependence requires more information processing than pooled interdependence andreciprocal interdependence requires even more information exchange (Figure 2-3).
A. Pooled Interdependence Information -Processing
I | |RequirementsBranch Bank Brsnch BankA BC Low
ConsumerBankingDivision
B. Sequential Interdependence
Petroleum Polymer Construction HigherProducts Chemistry Products
C. Reciprocal Interdependence
Research Advanced Clinical Highest
Figure 2-3 : Forms of Interdependence1
Linking mechanism have to improve the coordination of these work interdependencerelationships. A good linking mechanism must also be able to handle work flows associatedwith emergency situations and to provide a means for exercising control throughout anorganization. The designer's challenge is to choose the appropriate set of linking mechanismsto deal with the information processing requirements so that the organization can function as awhole.
2.4.1.2 Kelley's and Thibaut's Interdependence ModelKelley and Thibaut (1978) describe interdependence between work units as a function of theamount of control one group has over its own actions and over the actions of other groups. Themodel distinguishes between three types of control : Fate control, behavioral control andreflexive control.
Fate control refers to the how much power a work unit has over what another work unit can do.If work unit A has fate control over unit B, than B relies on the outcome of A's action and A hasa choice of doing or not doing what is necessary for B. In a manufacturing plant, work unit B mayfor example depend on a certain quality of A's output in order to produce qualitatively goodoutput itself. A can therefore affect the result of B's efforts by choosing to produce high or lowquality products. Behavioral control exists whenever A has the choice to do or not do somethingnecessary for B when B is ready to receive. A university professor, for instance, has the choice ofgiving work to students no matter, whether the students have nothing else to do or areoverloaded with work. In response to fate control and behavioral control the dependent unitmay have reflexive control. Reflexive control refers to the amount of flexibility work unit Bhas to adjust to the behavior of A. Students may have hardly any reflexive control over theactions of professors, but within a company a dependent unit may choose inventories as a meansof escaping behavioral control and reliance on more than one supplier against fate control.
The model argues that large amounts of fate and behavioral control lead to highinterdependence while reflexive control reduces interdependence. The relationship betweenwork units can therefore be seen in terms of three requirements for action: Requirements for one'sown actions, requirements for actions of others and requirements for joint actions.
2.4.1.3 McCann's and Ferry's Interdependence ModelMcCann and Ferry (1979) tried to develop a model that allows more precise measurement of thedegree of interdependence between work units, by focusing on the transactions or exchangesbetween work units. They propose that interdependence is an additive function of the followingfeatures :
e Number of resources exchanged.e Amount of each resource transacted per unit of time.e Frequency of transportation per unit of time.* Amount of time before loss of resource has an impact on the units outcomes.e Value of the resources to the unit measured in the cost of substitution of the resource,
the cost of locating another supplier or user, the qualitative importance of theresource and the percentage of time needs satisfied in the past.
The interdependence models testify that the connections between elements of an organizationhave been recognized as critical variables. However, the interdependence models do notdistinguish interfaces according to what is being exchanged at the interface, while obviously,different techniques are used for the improvement of information interfaces and materialinterfaces. Finally, the interdependence models do not explicitly take into account that feelings
I Adapted from Nadler (1989), p. 141
are exchanged between agents which influence the functioning of the division of labor. This is astrength of the human resource oriented approaches.
2.4.2 Human Resource Oriented FrameworksBoundary theorists do not explicitly talk about interfaces. However, their major concern are theboundaries around entities (organizations or groups) and how these groups interact with othergroups by managing the boundaries. The focus of this school of thought are the activities at theinterface rather than the relationships between the various units.
2.4.2.1 External BoundariesIn their model Aldrich and Herker (1977) draw on the systems approach to organizationaltheory. The organization has to perform two classes of functions at the boundary between thesystem and its environment. These two boundary roles are information processing and externalpresentation.
Information processing relates to the handling of information that flows into the system.Members of the system have to protect the system against information overload and mustfacilitate the information transmittal. Information processors need to have expertise ininterpreting and filtering the information received. They also need to know who within thesystem will need a particular piece of information. Selecting, interpreting and transmittinginformation are the main tasks of the information processors.
The second boundary activity is external presentation. Those in charge of this activity mustrespond for the organization to external influences. They have to achieve a compromisebetween organizational policy and environmental constraints. They must choose strategic movesto overcome these constraints and create conditions in which the organization's autonomy isseldom challenged.
2.4.2.2 Boundaries around GroupsAncona and Caldwell (1991) focus on the boundaries surrounding groups within an organization.They identify four types of external interactions a group has with its environment. Specificmembers of the group are usually assigned to represent the group in these interactions withoutsiders.
" Ambassador Activities : The goal of these activities is to represent one's group tothe environment. Moreover, aggression from outsiders is buffered by the individualsin charge of the ambassador activity.
- Task Coordinator Activities : Feedback from outsiders is filtered by the taskcoordinators. They also represent the group in negotiations with non-groupmembers.
* Scout Activities : In their need for information from outside groups scan theirenvironment for information relevant to the group.
- Guard Activities: Even though groups want to receive information from the outsidethey are very often not willing to release information to the outside. The guardactivity protects the group from unwanted information drain.
2.4.2.3 Boundary ManagementIn order to increase flexibility many companies are today trying to create a corporation withoutboundaries. General Electric's Jack Welch has described this new development in GE's 1990annual report. "Our dream for the 1990s," Welch wrote, "is a boundaryless company... where weknock down the walls that separate us from each other on the inside and from our keyconstituencies on the outside." Hirschhorn and Gilmore (1992) examine the results andimplications of these restructuring efforts. They argue that as traditional boundaries ofhierarchy, function, and geography disappear, a new set of boundaries becomes important.
* Authority Boundary : Even in a boundaryless organization some people will leadand others will follow. Despite the removal of the hierarchical gap an authoritygap may persist. Subordinates must have the courage to critic their managers and topropose new solutions. Managers in this new organization must, on the other hand,be open enough to accept critic and help from subordinates.
- Task Boundary : Division of labor and specialization are probably the roots of theeconomic success of the 20th century. However, specialization must go hand in handwith understanding the big picture. Workers must understand how their taskcontributes to the system as a whole. Only if workers understand what others do toachieve the organization's goal they feel proud of their own contribution andcomfortable about dependence on other. Therefore managers in the boundarylessorganization must eliminate task boundaries as well.
e Political Boundary : One of the promises of the boundaryless organization is tomake the company into "one big happy family" and eliminate politics from theworkplace. Politics involve the interaction of groups with different interests.Political activity can actually be an effective way of mobilizing the differentinterests and perspectives that together add up to a comprehensive view of theentire situation. Political activity becomes detrimental only when people areunable to negotiate and bargain in productive ways. Managing the politicalboundary means defining one's interest without undermining the effectiveness andcoherence of the organization as a whole.
e Identity Boundary : Identity boundaries separate the different informal groupswithin a company. People who share similar values form groups and develop a"who is and who isn't us" perspective. Identity boundaries can be energizing andmotivating for group members, but they also run the risk of disrupting the broaderallegiances necessary to work together. The challenge here is to create group spiritswithout devaluating the potential contribution of other groups.
These new boundaries are psychological and thus often invisible to the manager rather thantangible and formally defined. The implications for the proposed interface model are that thepsychological side of the points of contacts between agents will become increasingly important.A "good" interface between two agents should therefore have the capability of overcoming thepsychological boundaries as well.
The interdependence and human resource models focus on the interactions between differentunits of an organization. These interactions require functioning interfaces. The boundary schoolof thought adds the element that interfaces develop their own characteristics independent ofthe business relation between the agents. In the light of these models the next section willdescribe the interface model in some more detail.
2.5 The Interface Model RevisitedNow that we have seen a variety of approaches and models that treat the subject ofinterconnection between parts of organizations, the proposed interface model must be examinedto determine why it is new and to what degree it comprises certain features of previous models.
The interface model's purpose is to help managers identify any kind of interface existingwithin an organization. Once the interface is identified and classified the model helps themanager to make decisions regarding the improvement, the redesign or the abolition of theinterface. Three types of interfaces are distinguished : Psychological interfaces, materialinterfaces and information interfaces (Figure 2-4).
High Lowinvolvement involvement
Psychological
Interfaces Relatively highvalue per unitof time
Relatively lowvalue per unit
Non-repetitive Repetitive of timeInformation information
Figure 2-4 Interfaces
Material interfaces are the points of contacts between agents at which actual physical goodsflow. During the transformation process of raw material to finished goods physical matter ispassed on between the different links of the value chain. Moving the work in process materialfrom one station to another represents the interface. The Kanban system is a successful interfacemanager, because it makes sure that the receiver is ready to receive when the work in processarrives. This creates a smooth interface with small work in process inventories. However,material should not be interpreted to closely. Paper, of course, is a physical good, but in the casethat it is used to transport information, the point of contact where the paper changes ownershipshall be considered an information interface. A consulting company, for example, may deliver awritten report to a client. Since the contents of the report is information, the deliverance of thereport shall be considered an information interface. Drawing on McCann's and Ferry'sinterdependence model, one can distinguish material interfaces by the value of materialexchanged per unit of time. Obviously, improving high value interfaces would effect theoverall performance more than improving low value interfaces. However, the purpose of thisthesis is not to analyze material flow, but the information technology factor. Materialinterfaces are merely included to show how the interface idea can be applied to all aspects ofan organization.
Information interfaces are the points of contact where information is exchanged. Two basicallydifferent types of information exchange can be distinguished : Repetitive information exchangeand non-repetitive information exchange.
Repetitive information exchange usually involves larger amounts of data, which arerelatively frequently exchanged. The exchange process is a fairly routine activity for theagents involved and the data elements are defined, so that few misunderstandings occur.Examples for information interfaces with a repetitive character can be found in the monthlyreporting activity, in material demands from the production department to invoicing or incafeteria bulletin board messages about the meal plan of the week. In general repetitiveinformation exchange relies on accuracy of the data, low cost of data procurement, fast speed ofdata delivery, availability of the data and a common understanding of the meaning of thedata.
Non-repetitive information is exchanged in special projects, such as the development of astrategic plan or the organization of a Christmas party. The information exchanged tends to bemore subject to individual interpretation and is thus more ambiguous. Amounts of dataexchanged tend to be small, but the impact of the data on the whole organization tends to be
relatively greater than the impact of repetitive information. Finally, the receiver and thesender of the information may change their perceptions about the information whileinformation is exchanged, because of feedback from the other party. Through a process of trialand error with feedback loops information is transformed into knowledge and a decision.
Psychological interfaces try to capture some of the features of the human resource orientedboundary approaches. They refer to those connections that an individual or a group of peoplehave towards other individuals or groups of people on a psychological basis. The assumption isthat agents within an organization shelter themselves and develop a feeling of me or us andthem. Whenever material or information is exchanged between two agents, the actions of theparties involved are influenced by their feelings. In contrast to the exchange of information andmaterial the exchange of feeling is not essential for the functioning of the organization.However, psychological interfaces are part of the every day life in organizations and must beconsidered. For structuring reasons we will distinguish between three types of feelings.
1. Feelings that exist before the contact is established2. Feelings that occur at the moment of contact3. Feelings that influence the behavior after the contact
Each type of feeling can be roughly divided into feelings of high involvement and feelings oflow involvement (Table 2-2).
High Involvement Low Involvement
Pre Contact Feeling Hate, Love IndifferenceContact Feeling Contact provokes Contact does not
immediate good or affect agents directlybad feelings for oneagent
Af ter Contact Feeling affects future Feeling may exist,Feeling cooperation b u t ha s no
consequences
Table 2-2 : The Psychological Interface
Pre-contact feelings against other people are strongly affected by whether one perceives his orher interlocutor as 'superior' or 'inferior' or 'equivalent'. The perception of hierarchy does notonly depend on authority given by the working environment but can also be attributed toexternal factors such as "..she is better/worse looking,..he is much smarter/dummer,..she is abetter/worse tennis player,..he has more/fewer friends". Moreover, at the work place differentpeer groups may emerge. The members will communicate differently according to whether theytalk to a group member or an outsider. Likewise, departments within a company may seek togain power and influence for their personal pride or benefit. When members of such adepartment interface with members of an "opposing" department their behavior will beaffected. These feelings of high involvement are contrasted to situations, where neither one ofthe two agents cares about the status of the other or where feelings cannot affect the businessoutcome. Contact feelings can arise at the moment of getting together. An obvious example forcontact feelings those triggered by motivation or critique. Pep talks or organized dinners withsubordinates create positive feelings at the moment of contact, while critiques may evoke theopposite. After contact feelings are important, because often continuing cooperation is necessarybetween the agents. If one of the agents is hierarchically superior the importance of feelings isdiminished as he can command the other agent to follow.
Any interface between two agents can incorporate all of the three interface types describedabove. During the budgeting process, for example, information about targets and requirements ispassed up and down through the company. Managers continuously set goals for their employeesand control their achievements. Clearly information interfaces exist. However, this exchangeof information takes place at a vertical relationship with a psychological interface. Anotherexample are customer relationships. When a customer buys a product physical matter, theproduct itself changes hands. At the same time the sales person usually instructs the customeron the use of the product and information is exchanged. Finally the sales person wants to leavea good impression of the customer, so that he will buy from him again (after contact feeling ofhigh involvement). His behavior in terms of friendliness and consideration will be accordingly.
2.6 Treating InterfacesThe first step in the interface approach is to identify the existing interfaces. This must be donethrough analysis of the production work flow (flow diagrams) and of the formal structure of theorganization (organizational chart). Direct interviews with members of the organization arealso necessary in order to find out about existing informal interfaces and the psychologicaldimension of the formal and informal points of contact. Figure 2-5 describes the basic sequence ofinterface management activities. Once an interface has been identified, three possible measurescan be adopted : (1) Interface abolition, (2) interface redesign, (3) interface smoothing.
For all agents and interfaces between them do :
Identify IF
T
Is IF part Noof process Interface Abolition
T Yes
to IF necessar No Interface Redesianwork
Yes
s n e ace No< smooth Interface Smoothina
Figure 2-5 : The Interface Management Process
In order for interfaces to make sense an interface should be part of a process and thus help theorganization achieve its overall goals. Process can be divided into (1) processes that add valueand are part of the transformation process, (2) processes that exist for planning and controlreasons and (3) processes that motivate employees (Table 2-3).
Transformation Monitoring Motivation ProcessesProcesses ProcessesInbound Logistics Budgeting PartiesOperations Reporting Pep-talksOutbound Logistics Accounting Performance ReviewMarketing/SalesService
Table 2-3 : Types of Processes
For every identified interface one must first determine whether the interface is part of such aprocess. If no process can be identified the interface can be abolished. For example, a companymay have installed a private telephone line between headquarters and a particular division.However, most of the time information exchanged between the two agents is eithercommunicated through letters or through personal visits. Clearly, the standing telephone lineis not part of a process and can be disconnected. Another example may be a user that has globalaccess rights to all databases of an organization, even though he only needs to use certain filesin some databases. Abolishing those of his access rights to databases he doesn't need is possibleand probably even better for cost and security reasons.
The next question should address, whether the interface is actually necessary to make theprocess work. Let us, for example, take a look at the reporting process within a company. Rawdata is gathered at the forefront of the organization and then passed along the hierarchicallines of the company until it reaches its point of destination. It may be possible to cut out anumber of interfaces by sending the data directly from the data collector to the person up thehierarchy thus bypassing several layers of the organization. The speed and cost advantagesshould be apparent. This is the case of interface redesign, since some interfaces have to be
abolished but one new interface between the sender and the final receiver of the message mustbe established. The essence of the reporting process, namely the collection and presentation ofdata for management is still alive. However, the way the process functions has been redefined.
Interfaces remaining after these first two steps must be investigated in terms of their efficiency.The performance of the organization can be further improved by smoothening the necessarilyremaining interfaces. Otisline, the dispatching network of Otis Elevator is an example whereinterface smoothing has increased effectiveness. Among the many aspects of Otisline one of itsgreatest strengths was the increased speed of the elevator mechanics due to the newdispatching network, which provided better routing and scheduling of the mechanics. Otislineincreased the service speed and the reliability of Otis elevators by smoothing the interfacebetween the mechanics and Otis's central dispatching headquarters.
Chapter III. MANAGING INTERFACES
3.1 OverviewThe following section will show that most of the existing popular management frameworks areessentially ways of managing interfaces. Companies have basically three options whenconsidering what do to with the existing interfaces. They can obviously try to improve theefficiency and the effectiveness of the interface, what we call interface smoothing. Secondly,companies can choose to change the structure of the organization by eliminating some interfacesand creating new ones. We call this process interface redesign. Finally, a company may decideto get rid of an interface altogether. This is the case of interface abolition. Most probablycompanies will employ a combination of these techniques simultaneously, according to theimportance of the interface and the costs of managing it.
3.2 Interface Abolition
3.2.1 Core CompetenciesWhen we go back to our list of buzz-words it becomes clear that the ideas of Core Competenciesand Core Capabilities are essentially ways of eliminating interfaces. According Prahalad andHamel (1990) few companies are likely to build leadership in more than five or six corecompetencies and top management should not just be another layer of accounting consolidation,which it often is in a regime of radical decentralization. After the period of diversificationduring the 1970s many companies found themselves in a situation where it became tremendouslydifficult to manage all those decentralized and diversified divisions and subsidiaries at thesame time. The Interface Management theory's interpretation is that the interfaces that werecreated between completely unrelated business units were a heavy burden to companies. Byreducing the variety of business units and focusing on a few core ideas companies can reduce thenumber and complexity of interactions necessary in the organization.
3.2.2 EmpowermentEmpowerment1 is another answer to the problem of moving knowledge and information to thepeople who actually make decisions. Very often employees know better what the real problemsof the company are than their managers. A good example are sales representatives, whoexperience daily how the market responds to new products. It is very difficult for companies tomake sure that valuable information gathered in the field is moved up quickly to management.By flattening the organization and giving more power to employees, companies try to make surethat the people who have knowledge also have the means to use it productively for the benefitof the whole organization. By empowering employees the interfaces that once existed betweensubordinates and managers are partly abolished, as it is no longer necessary to always ask forpermission.
3.3 Interface Redesign
1 The idea has been renamed more times than Elizabeth Taylor
3.3.1 Business Re-engineeringRe engineering is the hottest word in consulting these days. The father of the idea, MichaelHammer argues (Hammer, 1990) that companies, instead of simply installing computer systemsto automate existing processes, should consider tearing down those processes and starting fromscratch - straighten rather than merely pave the cow paths. Business re engineering is thefundamental rethinking and radical redesign of an entire "business system" - the businessprocesses, jobs, organizational structures, management systems, and values and beliefs - toachieve dramatic improvements in critical measures of performance1 .
Arguably Hammer would like to eliminate all existing business patterns and install acompletely different system : "Re-engineering cannot be planned meticulously andaccomplished in small cautious steps. It's an all-or-nothing proposition with an uncertainresult."2 Processes, in Hammer's definition are sequences of activities that create something ofvalue for customers. Re- engineering sets out to improve these processes, which will mostcertainly be achieved by cutting out processes that are inefficient and by creating a new flow.This is essentially what interface redesign is all about, because rearranging the work flowrequires cutting down existing interfaces and creating new more effective interfaces between theremaining processes of the work flow.
3.3.2 OutsourcingOutsourcing can be interpreted as another way of redesigning interfaces. Outsourcing refers tothe idea of eliminating one function of an organization and ordering the same service from anoutside supplier. Internal interfaces are abolished and new interfaces to suppliers arise. But thenature of these interfaces is often easier to manage. When Kodak outsourced it's IT activities itfollowed the philosophy that information should be like electricity coming out of the wall.Legal contracts replaced internal hierarchy. Problems with providing information could beopenly attributed to the service provider after the outsourcing without risking internalcomplications. Moreover, Kodak was more flexible in choosing its external IT provider.Competition between service providers may potentially drive down the price of the service andgive Kodak a better bargaining position.
3.4 Interface SmoothingSmoothing is the most common way of handling interfaces. Again back to the popularmanagement thinking it will be clear after this section that the following theories arebasically interface smoothing refinements
e Time Based Competitione Lean Production (Just-in-Time, Total Quality Management)* Learning Organization
3.4.1 Time Based CompetitionTime (speed) is becoming a principal basis of competitive battles and strategic advantages ordisadvantage. Honda can develop a car five times as fast as America's Big Three can, Compacis twice as fast as IBM in developing a new computer and Wal-Mart can make decisions aroundtwelve times faster than Sears3 . Why are some companies faster than others ? George Stalk Jr.,who coined the term time-based-competition would probably answer, that these companieshave understood that time, like cost, is manageable and a source of competitive advantage.More concretely, these companies were able to reduce wasted time in activities that did not addvalue to the company. Everes a personal computer manufacturer in Fremont, CA calls itself the"zero-response-time-company". Everes shifts its production mix every two hours, based oncontinuous polling of its telemarketers. This company has effectively smoothed the interfacesbetween the customers, the marketing department and production. Flexible manufacturing
1 "What is Re engineering ?", InformationsWeek, May 4, 1992, p. 102 Hammer (1990), p. 1053 "Speed becomes a 'leading edge' "; Industry Week; June 19, 1989
systems, advanced information systems, high employee involvement and the choice of theright organizational structure are the key tools for the implementation of time-based-competition. In the light of the interface management approach these elements all serve thepurpose of improving the interfaces between the agents of an organization.
3.4.2 Lean ProductionThe word "Lean Production" came up in 1990, when James. P. Womack and his colleagues at theMassachusetts Institute of Technology published their five year study of the world'sautomotive industry. They dubbed Japan's breakthrough a system of "Lean Production"developed mainly by Toyota Motor Corp. in the 1950s and 1960s. With this approach Japan'sindustry has leapfrogged the mass-production system created by Henry Ford and Alfred P.Sloan. While mass-production relies on specialization, rigidity and top-down traditions, "LeanProduction" requires flexibility, teamwork, egalitarianism and cooperation throughout thecompany and with customers and suppliers.
Cooperation can be directly viewed as a form of interface smoothing, because cooperationrequires that the different agents and processes communicate with each other. A smoothinterface fosters communication necessary for the functioning of the business, but also requiresthat no time is wasted at the interface. In other words, cooperation is useful but too muchcooperation can be counterproductive. Teamwork and egalitarianism are nothing but ways toassure smooth interfaces. Within a team information is usually shared more freely and teammates often motivate each other through the exchange of ideas. The psychological interfacedimension is better in this environment and therefore the interface is smoother. Flexibility, canonly be obtained if companies find a way of making sure that information about newdevelopments is quickly passed on to the persons in charge. In the traditional Tayloristicsystems, decision makers hardly get into contact with the people on the front. Therefore, theseorganizations often suffer from extreme inertia, as the interface between top management andemployees are usually poorly matched. By using teams, many of the decision making process ispushed down to the shop-floor, abolishing unmanageable interfaces.
3.4.2.1 Just-in-TimeJust-in-Time (JIT), a tool used in lean production, tries to smooth process interfaces between thevarious stages of production, by ensuring a continuous flow of material through the entireproduction process. Elimination of waste is the main goal of JIT and the principal measure ofsuccess is how much or how little inventory there is. Virtually anything that achieves this endcan be considered a JIT innovation. Reducing machine set-up times and eliminating rawmaterial inventories can also be interpreted as improving the interfaces between the value-adding processes of transformation.
3.4.2.2 Total Quality ManagementTotal Quality Management (TQM) or Total Quality Control, as the Japanese call it, is amanagement style based heavily on processes. Key elements of TQM are customer orientationand employee involvement. Customer orientation calls for closer relationships between thecustomer and the company. Japanese auto-manufactures such as Toyota, have realized a longtime ago that losing an existing customer cannot be compensated for by gaining a new customer.Customer orientation makes it necessary to improve the external interface a company has withits customers. Employee involvement on the other hand is a direct response to the informationflow problems between shop floor workers and quality engineers. In traditional mass-productionplants production mistakes are only found at the very end of a production line. With employeeinvolvement, the interface between workers and quality inspectors has been abolished, becauseworkers are now themselves responsible for checking the quality of a product.
3.4.3 The Learning OrganizationThe theory of the learning organization claims (Senge, 1990) that corporations shouldencourage everyone at every level to learn more, become more proficient, and see the company'swork from an overall perspective. Fragmentation, secrecy, and strict authoritarian rules are no
longer wise or profitable. According to Senge five elements contribute to the learningorganizationi-
e Systems thinkinge Clear mental modelse Building a shared visione Teamse Personal mastery of work
Many elements of systems thinking itself form the basis for the interface managementframework. Interface management relies on the notion of agents, which corresponds to elementsin systems theory. Moreover, the distinction between internal and external interfaces can beseen as the outgrowth of the notions of system boundaries and system environment in systemstheory. Having clear mental models and building shared visions can only be achieved ifinformation is floating freely throughout the organization. Wherever such free flow ofinformation seems impossible it is advisable to get rid of the interface, an approach partlytaken in team formation.
One may argue now that the "Learning Organization" is actually more than an interfacemanaging system as it incorporates the notion of personal mastery of work. Personal mastery ofwork would refer to the optimization of the processes and the agents itself and is thus not a partof the interface philosophy. However, interface management purposefully neglects this aspect.The idea is that an organization must be able to replace its agents and processes by othersimilar elements. For example, an employee may retire or a production process is revised. Whatwill remain is the interface. It clearly is important to have well working agents and elements,but the argument of this paper is that the quality of interfaces is more critical to theperformance of a company than the quality of agents and processes (see Section 2.3).
Chapter IV. CONCEPTUAL INTERFACE DESIGNThe interface framework described in the earlier chapters is applicable to material,information and psychological interfaces. Nevertheless, the remainder of the thesis willconcentrate on information interfaces and the psychological dimension. An in-depth study ofmaterial interfaces would be beyond the scope of this paper.
The apparent question that emerges when thinking about managing information interfaces isthe direction towards which the interface should be modified. Is there such a thing as a perfectinterface design for a given organization ? The next two chapters of the thesis will outline howorganizations can choose the right interface setup, both at a conceptual and a technical level.Unfortunately the literature on organizational design, organizational coordination andorganizational communication somewhat lacks a rigorous and clear definition of terminology.For the purpose of transparency this thesis will divide the processes of improving the flow ofinformation and coordination and managing interfaces into three steps or levels of decision.
The first level of decision concerns the choice of the underlying organizational strategy fordesigning interfaces. Strategy here shall be defined as the fundamental decision concerning thestructure and the overall setup of the organization. Once an appropriate strategy is found thesecond choice concerns the right coordination mechanisms to be employed. Coordinationmechanisms, such as plans or teams, should be in line with the strategy chosen. Coordinationstrategy and coordination mechanisms have implications for the general characteristics of theinformation and psychological interfaces of the organization. The third level of decisionconsiders the right means and specific technologies employed at the information interfaces.Chapter five will show how the technology decision is influenced by the choice of theunderlying organizational setup.
1 Management Bookshelf; March 18, 1991; p. 18
4.1 Choosing the Right Coordination Strategy
4.1.1 Basic Coordination Strategies
4.1.1.1 Markets, Hierarchies and NetworksWilliamson (1975) distinguishes two basic strategies of coordinating the flow of goods andinformation : Markets and Hierarchies. Markets regulate the flow through the forces of supplyand demand. Hierarchies, on the other hand, coordinate through control and directing. Thebasic trade-off between the two alternatives are the costs of coordination and the transactioncosts. While markets tend to lead to lower coordination costs than hierarchies, the transactioncosts such as information gathering are generally higher in markets than in hierarchies. Thenetworked organization is an information technology enabled concept that tries to overcome thedilemma between transaction and coordination cost reduction. Different organizations ordifferent units within an organization can be tied together through information technology andalso be separated whenever necessary. The dynamic structure relies on rules and membershipand helps to increase the flexibility of the organization. These three forms vary in thestability of their interfaces, with hierarchies having stable relations, followed by networksand finally markets.
4.1.1.2 Organic vs. Mechanistic StrategiesBurns and Stalker (1961) concentrate on coordination strategies within organizations. Theyidentify three dimensions for distinction between coordination strategies, which are formality,cooperativeness and localization. Formality refers to the amount of rules and formalestablishments that determine the coordination activities of an organization. The degree ofcooperativeness is a reflection of the understanding between vertically related units of theorganization. The opposing extreme of cooperation is control. The third dimension, localization,distinguishes centralized and decentralized organizations. Two basic coordination strategiesexist, which differ along those three dimensions. Mechanistic strategies have formal,centralized and control characteristics, while organic strategies, on the other hand, are moreinformal, decentralized and cooperative.
4.1.1.3 MintzbergA good systematic of coordination strategies is given in Mintzberg (1979). Mintzberg identifiesfive basic strategies companies use and can use to coordinate their activities and to thus enjoythe benefits of division of labor. The five strategies are mutual adjustment, direct supervision,standardization of the work process, standardization of the work output and standardization ofworker skills. Mutual adjustment achieves the coordination of work by the simple process ofinformal communication. Under mutual adjustment, control of the work rests in the hands of thedoers. Direct supervision coordinates by having one individual take responsibility for the workof others, issuing instructions to them and monitoring their actions. Work can also becoordinated without mutual adjustment or direct supervision. In this case, standardization ofthe process, of the output or of the workers' skills and qualifications ensures coordinated workbefore the work actually begins. Mintzberg argues that mutual adjustment is the means ofcoordination used in very simple organizations but also in the most complex ones, as all othermeans of coordination fail to work. Mutual adjustment can be classified as a organic strategysince its strength stems from its inherent flexibility.
The choice of the coordination strategy determines the characteristics of interfaces within anorganization. Networks have less stable interfaces than hierarchies. In organic structuresinterfaces tend to be more lateral then in mechanistic setups with implications for thepsychological interface dimension. Finally, coordination through mutual adjustment and directsupervision requires much more interfacing on the job than coordination throughstandardization. It is important to realize how the strategy choice affects the interfaces. Thefollowing section will describe some theoretical opinions about determination of the rightstrategy.
4.1.2 Determining the Strategy
4.1.2.1 ClassicistsThe classicists are generally divided into the school of scientific management (Taylor,Gilbreth) and the school of administrative theory (Fayol, Mooney, Weber). Both streams ofthought were mainly concerned with differentiation and integration. The dominant questionwas, how to divide the tasks of an organization and how to maintain integration within theorganization. Many classicists felt that "Coordination expresses the principles of organizationin toto" (Mooney, 1931). The classicists answer to the coordination problem was hierarchy. Thechain of command was seen as an entirely rational automatic means for achieving integration.The rigid organizational structure restricts communication to a few, formalized channels. Thisreduces the number of messages and avoids confusion. Interdepartmental coordination isachieved through formalized weekly manager meetings.
The classicists solution was probably appropriate for the stable, pre World War II businessenvironment. In today's environment of fast changing markets, however, flexibility has becomeone of the greatest assets a company can have. The examples of IBM and General Motors testifythat inflexible, hierarchical companies can no longer survive.
4.1.2.2 Markets, Technology and Task PredictabilityThe contingency school of organizational structuring tries to determine the variables thatcondition the strategy choice. Burns and Stalker (1961) conducted one of the first empiricalstudies in 20 British and Scottish manufacturing firms. Their findings where that for marketscharacterized by rapid changes in products and technologies an organic organizational setupseemed more appropriate. The mechanistic form, on the other hand, was more effective inmarkets that were stable and had little change in technology. A second study involving 100English manufacturing firms reported comparable findings. Woodward (1965) believed that thetype of production process used by the firm determined its choice of the organizational form.Her study finds evidence that the spans of control of the management hierarchy decreasedwith increases in the technological complexity of the production process. Low technologicalcomplexity was to be found in job shop settings while high complexity was found in processindustries such as oil refineries. Harvey (1968) took a similar approach. By measuring theamount of change in firms products, he believed to capture what Woodward had calledtechnological complexity. Hall (1962) introduced a variation to the previous views. While thefirst three studies focused on the market served and the technology used by a company Hallgeneralized by proposing that the degree of task predictability accounts for variations in theorganizational structure. Companies with predictable tasks had well defined hierarchies ofauthority, greater division of labor, and made greater use of procedures. Departments with lesspredictable tasks exhibited these characteristics to a lesser degree.
4.1.2.3 Structure Driven ChoiceMintzberg (1979) believed that the coordination strategy chosen by an organization must becoherent with the formal structure of the entity. Mintzberg identifies five types of structuralconfiguration, which determine the choice of coordination mechanism:
e Simple Structure : The simple structure is as the name says very simple. Typically, it haslittle or no technostructure, few support staffs, a loose division of labor, minimaldifferentiation among its units, and a small managerial hierarchy. Young, smallenterprises in dynamic environments tend to follow this structure. Direct supervisionemerges as the dominant coordination mechanism, with coordination usually residing withthe head of the organization.
e Machine Bureaucracy : In this environment one finds routine operating tasks, veryformalized procedures, a proliferation of rules and reliance on the functional basis forgrouping tasks. Power for decision making is relatively centralized. These settings can befound in older companies in mature markets with relatively simple production processes.The preferred strategy of coordination for this kind of organization is standardization ofwork process. Coordination is thus achieved prior to the actual transformation process.
e Professional Bureaucracy : This type of structure is common in universities, generalhospitals or school systems. The environment requires decentralization of the decisionpowers, but the work performed is relatively stable. The professional bureaucracy relies onstandardization of skills for coordination. This is achieved through training and carefulhiring processes.
" Divisionalized Form : This type of formal organization is most widely used in the privatesector of the industrialized economy. Each division is itself organized according to themachine bureaucracy form and is thus relatively independent of the other divisions of thecompany. Headquarters usually monitor divisions by defining top goals such as budgets andmarket shares. Coordination is done with the help of these monitoring parameters. In otherwords the divisionalized form relies on the standardization of outputs as its majormechanism for coordination.
e Adhocracy : Adhocratic organizations have a highly organic structure, with littleformalization of behavior. They are found in complex, dynamic environments. In order tomaintain flexibility they rely on mutual adjustment as their mechanism of coordinationand favor the existence of liaison devices.
The choice of the organizational setup and the underlying coordination philosophypredetermines the basic characteristics of the organization's interfaces. Changing the structurecan therefore be interpreted as interface abolition or interface redesign. Restructuring occurs,however, relatively seldom. More frequent are changes in the coordination mechanisms anorganization uses.4.2 Choosing the Right Coordination Mechanism
4.2.1 Basic Coordination MechanismsCoordination mechanisms are defined as the organizational tools an organization uses tocoordinate its activities. The sum of the coordination mechanisms determines theorganization's structure. Therefore organizations will chose coordination mechanisms that arein line with their coordination strategy choice.
Independently of the organizational structure physical, spatial coordination mechanisms andbuffers can be used to improve interfaces. Retailers, for example, often choose to locate regionaldistribution centers close to the customers. This eliminates some of the coordination difficultiesand improves the interface between the magazines' sales personnel and the inventorymanagement. Slack resources are the second generic mechanism used to improve coordination bydecreasing the amount of interdependence. Managing interfaces obviously means to eliminatethis costly means of coordination.
4.2.1.1 Mechanistic MechanismsOrganizations, the purposes of which are best served by a mechanistic organizational setup,will predominantly use mechanistic mechanisms. Mechanistic companies usually make theirchoice out of the following list of mechanisms:
e Rules and programs are the mechanisms used to coordinate work units throughstandardization of processes. The primary virtue of rules is, to the extent that the jobrelated situations can be anticipated in advance, that they eliminate the need forfurther communication among the subunits.
e Reliance on direct management contact at all levels with a clear definition ofauthority is used in exceptional situations which cannot be handled by the existingrules. The exceptions are referred to higher levels within the hierarchy up to thefirst position where a shared superior exists for all affected units.
e Planning and goals are very similar to rules, in that coordination is achieved throughstandardization of outputs. The acting unit usually has some margin in choosing theway of fulfilling the goal. In this case performance control systems serve to measuregoal achievement and to motivate.
- Action planning emerges as the means by which the non routine decisions and actions
of an entire organization, typically structured on a functional bases, can be designed asan integrated system.
e Vertical information system increase the information processing capacity of theorganization, by strengthening the organizations hierarchy. Examples aremanagement information systems or the reduction in the plan-replan cycle.
e When a considerable amount of contact is necessary to coordinate the work of twounits, a "liaison" position may be formally established to route the communicationdirectly thus bypassing the vertical channels.
4.2.1.2 Organic MechanismsOrganizations with an organic strategy tend to manage integration through liaison devices.These more people oriented mechanisms are generally used where work is, at the same time,horizontally specialized, complex and highly interdependent. Liaison devices improve lateralinterfaces and provide more flexibility, but they also tend to result in a proliferation of themanagers in the organization. Any combination of the following liaison devices can be found inorganic organizations.
e Direct contacts between the work units, e.g. the members of two departments willincrease mutual understanding and therefore improve the interfaces between theunits.
e Cross functional teams or cross-departmental teams are institutionalized ways ofimproving communication and coordination between different work units. The taskforce is a temporal team formed to accomplish a particular task and then disband.The standing committee is a more permanent interdepartmental grouping, that meetsregularly to discuss issues of common interest.
- Independent integrators for coordination : Integrators differ from liaison personnel(direct contacts and teams) in that integrators are independent of the departmentsthey coordinate. Instead, they report to the common manager that the departmentswhich are coordinated also report to.
e Integrative departments may be used to coordinate the efforts among functional units.
4.2.2 Determining the Coordination MechanismsNaturally the question arises, which coordination mechanism should be used under what kindof circumstances. As stated earlier the classicists believed that hierarchy was the one and onlyeffective coordination mechanism. However, organizational scientists have understood sincelong that this view is too simplistic. The contingency school of organizational theory believesthat there is in effect no single best way to coordinate the activities of an organization.
Once this was accepted the search for the independent variables, that determine the choice ofcoordination mechanisms began. Over time a number of studies and theoretical works haveproduced a variety of possible determinants for the choice of coordination mechanisms. Themain conditioning variables believed to influence the choice are:
" Degree of Differentiatione Degree of Interdependencee Degree of Interunit Conflicte Degree of Non correspondencee Predictability / Uncertainty of Task
4.2.2.1 Theories with one conditioning variable for the choice of the means of coordination
4.2.2.1.1 Task UncertaintyLawrence and Lorsch (1967) define coordinationi as "the quality and the state of collaborationthat exists among departments that are required to achieve unity of effort by the demands of
I Lawrence and Lorsch refer to coordination as integration
22
the environment" ( p. 11). In their view organizations differentiate into subunits to simplifymanagement processes and to accumulate expertise driven by shared goals and objectives.Differentiated subunits differ in goal orientation and in the formality of their structure.Integration is the force that has to hold differentiated companies together. According toLawrence and Lorsch the means of integration depend upon the uncertainty of the tasksperformed by the subunits. In their study of companies in the plastic, food and container businessthey found that in uncertain environments (plastics and foods) coordination was achievedthrough special departments or special individuals. In certain environments (containers) theuse of hierarchy showed better overall performance.
Van de Ven, Delbecq and Koenig (1976) conducted a study among supervisors and personnel inoffices of the administrative headquarters of a large state employment agency. They sought todetermine the relation between task uncertainty facing a work unit and the coordinationmechanism employed. Six methods for achieving coordination were considered:
e Rulese Planse Vertical channelse Horizontal or informal channels* Unscheduled meetings- Scheduled meetings
Their findings were, that as the degree of uncertainty of the tasks undertaken by a work unitincreases, the use of impersonal coordination techniques like rules and plans decreasessignificantly and the use of personal and group coordination increases significantly (Figure 4-1).
10 Rules
Extent towhich Plans ---- Unscheduled Meeting.coordinationmechanisms 6 Vertical Channels ,-are used
4 Horizontal Channe- Scheduled Meetings
2
0Low Medium High
Task UncertaintyFigure 4-1 : Choice of Coordination Mechanisms1
Increased uncertainty seems to result in the increased use of "unprogrammed", personal types ofcoordination mechanisms like horizontal channels, unscheduled and scheduled meetings.
4.2.2.1.2 Interunit ConflictMarch and Simon (1958) believed that managers faced with interunit conflict prefer unilateral(rules, programs) rather than multilateral (bargaining, confrontation) coordinationmechanisms to resolve conflict.
Rubin (1980) conducted a study focusing on the degree of interest and goal conflict as
I Adapted from Dessler ( 1986) p. 158
determinant of coordination strategy. He found evidence that in situations where third partyintervention is likely to be needed most - when the conflict is intense - the anticipation of suchintervention may prove least helpful, leading participants to freeze their positions andthereby create an impasse. Conversely, it is when the third party's services are least essential- when conflict is relatively small - that the anticipation of intervention may lead thedisputants to make concessions and arrive at a settlement sooner than they might haveotherwise. This analysis focuses, however, on the anticipation of third-party involvement.Other findings (Bartunek, 1975) suggest, that once actual third party entry has occurred, activeintervention in an intense conflict may facilitate concession making and settlement. From acoordination point of view this means that the best solution to manage interunit conflict wouldbe to leave the agents alone. However, in any organization members are aware of possible thirdparties - superiors - that might intervene. Since this is not avoidable it seems to be moreeffective to adopt an active mechanistic strategy in situations of strong interunit conflict.
Shapiro (1977) points out that conflict can ensure effectiveness and efficiency. Topmanagement's task is to maintain a constructive amount of tension by making sure that bothparties understand the need for a balanced situation but still strongly represent their owninterests. Shapiro proposes that management should employ a number of techniques to balancethe interface. Mediation, arbitration, explicit policies, modified performance measurements,and encouragement of informal meetings should be used together.
4.2.2.2 Theories with multiple conditioning variables for the choice of the means of
coordination
4.2.2.2.1 Task Uncertainty and Degree of InterdependenceGalbraith (1969) introduces an information processing view of the organization. Hehypothesizes that the information processing capacities of the organization must equal itsinformation processing requirements. The information processing requirement in turn is a functionof uncertainty of the tasks performed and the amount of interdependence, measured as acombination of the number of units and the degree of Thompson interdependence between theunits. A continuum of coordination methods exists as task uncertainty and interdependenceincrease. In simple situations companies will use rules, followed by authority of hierarchy andplanning. As the number of exceptions begins to overload the hierarchy the organization canattempt to reduce its information processing requirements through slack resources and greaterself containment of the subunits. The alternative is to increase the information processingcapacity through vertical and lateral information systems.
4.2.2.2.2 Degree of Interdependence and Amount of ConflictVictor and Blackburn (1987) based their study on the Kelley/Thibaut interdependence modeldescribed earlier. They felt Thompson's model was unusable because of its ordinal scale inmeasuring degrees of interdependence. They also rejected McCann and Ferry's transaction modelbecause it does not consider reciprocal interdependence explicitly enough.Their study supported the following two hypothesis. First, increases in the amount ofinterdependence created by the division of labor should be associate with the selection andeffectiveness of increasingly lateral, organic coordination strategies. Second, increases in thenon correspondence of outcomes created by the division of labor will be associated with theselection and effectiveness of increasingly vertical or mechanistic coordination strategies.Figure 4-2 outlines the coordination strategies adopted in various situations.
HighChain of MatrixCommand
Amountof non-correspon-dence Rules or Mutual
SOPs Adjustment
Low
Low High
Amount of InterdependenceSOP: Standard Operating Procedure
Figure 4-2 : Coordination Mechanisms
The results of the study are in line with Thompson's (1967) predictions, that as the degree ofinterdependence increases organic coordination strategies will be more effective.
4.2.2.2.3 Differentiation, Interdependence and Interunit ConflictVictor (1990) conducted a controlled laboratory experiment with 104 MBA students toinvestigate how differentiation, interdependence and interunit conflict between work unitsdetermine the choice of a coordination mechanism. The results of the study were, that a highdegree of interdependence, as well as a high degree of differentiation would lead students to
choose an organic strategy. A high degree of interunit goal and interest conflict led to the choiceof a more mechanistic organizational form.
This chapter has given a short description of the evolution of theories about organizationalcoordination. The development has led to a contingency view, that identifies the degree ofuncertainty, the amount of conflict and the degree of interdependence as the three mainconditioning variables for the choice of proper coordination strategies and mechanisms.
Low InterdependenceLow UncertaintyHigh Conflict
Mechanistic Setup
HighInterdependenceHigh UncertaintyLow Conflict
Organic Setup
Psychological Low Involvement High InvolvementInterfaces e Standards e Direct Contact
e R u l e s & e HorizontalPrograms Channels
e Plans e Cross Functionale Formal Liaison Teamse Hierarchy
Information Repetitive Non-repetitiveInterfaces Information Information
e Standards e Horizontal" Rules & Channels
Programs e Cross Functional" Clear Goals Teams
0 Task Forcese Unprogrammed
CoordinationFigure 4-3 Influence of Conceptual Choice on Interface Dimensions
Figure 4-3 summarizes how organizations adapt best to the values of the three mainconditioning variables, uncertainty, interdependence and conflict. Clearly, other combinationsof the values of the conditioning variables are possible, but the point to be made is that theresulting choice of the organizational setup has general implications for the characteristics ofthe information and psychological interfaces of the organization. In a mechanistic settinginformation tends to be more repetitive and psychological involvement is relatively lower.Although conflict in the environment that prescribes a mechanistic setup is higher at theoutset, the adoption of clear hierarchies and authority will in general lead to psychologicalinterfaces of relatively lower involvement. Organic setups, on the other hand, tend to fosterhigher psychological involvement and the exchange of non-repetitive information, since theyare less formalized and rely more on mutual adjustment.
PsychologicalDimension
HighInvolvement
LowInvolvement
RepetitiveInformation
Non-repetitive InformationInformation Dimension
Figure 4-4 : Interface Characteristics in Organizational Setups
In a matrix spanning the dimensions of psychological and information interfaces (Figure 4-4),interfaces in organic structures will tend to be in the upper right hand quadrant, whileinterfaces of mechanistic settings will be in general in the lower left-hand quadrant. Chapterfive will describe how these findings can be transformed into the choice of the right interfacetechnology.
Chapter V. CHOOSING THE RIGHT TECHNOLOGY
5.1 Basic Communication Technologies
5.1.1 Types of CommunicationCommunication means can be categorized along a number of dimensions. A useful categorizationis to distinguish between type A, type B and type C communication (Christie, 1985). Type Acommunication corresponds to person-to-person communication with real time responsepossibility. Type B communication refers to communication via a storage medium, such as aletter, in which no immediate feedback is possible. Type C finally is defined as communicationbetween a person and an "intelligent" machine, e.g. an expert system. Other dimensions aretechnological sophistication of the medium, availability of the medium, the possiblerelationship between the number of senders and receivers (one-to-one, many-to-many) and thenumber of senses involved in the information exchange (sight, written, voice). Table 5-1 gives anoverview over available communication systems and defines their specific attributes.
Medium iyp Availabi Relatio Sensese lity M
Face- to - Face A High all allLetter B High OO+,O written
M
Flyer B High OM writtenTelephone A High 00 voiceFax B Medium OO,OM writtenTeletext B Low 00 writtenDatabase B,C Medium all writtenClient Server B,C Low all written
e.g. High Conflict,Low Uncertainty, OrganicHigh Interdependence Settings
Mechanistic e.g Low Conflict,High Uncertainty,
Settings Low Interdependence
Medium Availabi Relatio Senses
Voice Mail B Low 00 voiceEmail B Low O0,OM writtenVideo Telephone A Low 00 voice,
sight
Audio Conferencing A Low all voiceVideo Conferencing A Low all allSatellite Conferencing A Low OM allComputer Conferencing A,B Low all writtenBulletin Board Systems B Low OM,M written
0
00 : One-to-One-Relation; OM One-to-Many-Relation;MO : Many-to-One-Relation; MM : Many-to-Many-Relation
Table 5-1 : Categorization of Communication Media
5.1.2 Traditional Means of Communication
5.1.2.1 Interpersonal Communication
5.1.2.1.1 Face-to-Face and MeetingsVirtually every empirical study of managerial time allocation draws attention to the greatproportion of time spent in verbal communications with estimates ranging from 57 % of timespent in face-to-face communication by foremen (Guest, 1956) to 89 % of episodes in verbalinteraction by middle managers in a manufacturing company (Lawler, Porter and Tennenbaum,1968). Rosemary Stewart (1967) who collected the most extensive data, found that conversationconsumed 80 % of the middle manager's time. Mintzberg's (1973) finding were approximatelythe same. He found that verbal interaction accounted of 78 % of the five managers' time hestudied and 67 % of their activities. Studies among technical and professional employees yieldsimilar results. Klemmer and Snyder (1972) reported that employees working in acommunications research and development laboratory spent around 50% of their workdaytalking. Similarly, Graham, Wagner, Gloege and Zavala (1967) studied informalcommunication among scientists and engineers and found about two-thirds were face-to-facemeetings.
As a verbal medium face-to-face communication can send messages through voice inflection andthrough delays in reaction, in addition to the messages contained in the words used. Moreover,face-to-face media carry information transmitted by facial expression and by gesture.Mintzberg (1969) reported also, that executives prefer verbal communication since letter writingis more time consuming and words to be documented must be chosen more carefully.
5.1.2.1.2 Printed Interpersonal MediaLetters, memos, flyers and bulletin board announcements are type B means of communication.The invention of the printing press is often referred to as one of the great steps in humancommunication. The twentieth century may, however, well enter the history books as thecentury of paper. The recent proliferation of computer word processors and high performancecopying and printing devices has drastically increased the ease of using paper basedinterpersonal media.
5.1.2.2 Machine Assisted Communication
5.1.2.2.1 Telegraph & TelephoneBefore the telegraph, introduced in the mid-nineteen's century, information traveled at thespeed of humans and goods. The telegraph collapsed distances for communication bytransmitting alphanumeric text converted into Morse code rapidly across the country.
The telephone was introduced only a few decades after the telegraph. It permitted the
transmission of voice. Suddenly people could communicate across long distances and exchangefeelings, as the voice permits the use of intonation. Today 90% of the US households have atleast one telephone.
5.1.2.2.2 Fax & TeletextFacsimile today provides rapid document exchange and even some low resolution graphictransmission. The technology was already invented in 1843 by Alexander Bain. However, theproliferation of fax machines took only place in the 1980s, due to the introduction ofinternational standards by the CCITT, a sharp drop in prices and increases in the quality oftransmission. In 1986 projections were that by 1990 one million fax machines would be in use inthe US. However, already in 1989 3.2 million fax machines were installed in the US notincluding fax boards in computers. In 1991 Sharp Corporation introduced the first color faxmachine and in June 1992 Sony announced the release of a portable fax weighing merely 1.5kilogram. Similarly to the telephone the value of a fax machine increases as the number ofother users rises and one can therefore expect the fax market to enter private households in thenearest future.
Teletext is an upgrade of a much older system, telex. Contrary to telex, which used telegraphcircuits, Teletext uses the telephone network. In conjunction with television sets Teletextprovides Videotext features and offers a fast method for sending high quality text from user touser.
5.1.3 Computer Mediated Communication Technologies
5.1.3.1 The Importance of the New MediaThe advent of computer mediated information technologies is likely to have similar if not moreimportant consequences than the invention of the telephone. IT networks eliminate data entryand conversion steps anddatabases reduce conversion and processing steps. More information is available more quickly tothe user. Examples as the Sabre airline reservation system, Baxter's invoicing system and Otis'sdispatching network clearly manifest the profound effects information technologies can have.As IT reduces cost and time of communicating information it can be argued (Benjamin, 1986) thatelectronic markets and electronic hierarchies will dominate in the future.
Within the organization information technology (IT) was originally used to support largebatch processing activities. The proliferation of local area networks and distributed hasopened new opportunities for information technologies. Information technology provides a newapproach to effectively managing interdependence (Rockart, 1989). In a study of 16 companiesRockard found that information technology enables value chain integration and within functionintegration. Moreover IT supports team work, improves integration of planning activities andsupports integration within the IT function itself.
5.1.3.2 Communication Means for Unstructured Information
5.1.3.2.1 Voice MailVoice mail or voice messaging provides store and forward advantages to voice messages. Inessence, voice mail, is an advanced answering machine. Voice mail is an asynchronous,computer-mediated technology that uses the telephone as its access device. The analog speechtransmitted via the telephone line is digitized, stored in computer memory and reconstructed toanalog form when requested by the recipient (Finn 1986). The market for voice mail systemsgrew rapidly during the late 1980s from $ 5 million in 1984 to $ 623 million in 1989. Voiceresponse systems, which provide the caller with a menu choice, also have become extremelypopular, with sales figure rising from $ 10 million in 1984 to $ 350 million in 1989. Studiesestimate that 50% of all telephone calls are simply made to convey information and do notrequire a two-way conversation1 . Voice mail and voice response systems thus reduce the amount
1 Telecommunication Market Review, p. 156
of time spent returning phone calls. As an audio based medium voice mail allows for exchange ofintonation, but no immediate feedback is possible.
5.1.3.2.2 Audio ConferencingAudio conferencing is a natural extension of the telephone device. Instead of two parties a groupof people can talk to each other simultaneously over the telephone.
5.1.3.2.3 Video TelephoneVideo telephones serve for two way desk-to-desk interactions between two people. Thistechnology has not been used very often until now. However, ISDN with 64 KB bandwidthcombined with improved compression techniques will increase the quality of the transmissionin the near future.
5.1.3.2.4 Video ConferencingVideo conferencing is the media that probably comes closest to a face-to-face meeting. Thistwo-way fully interactive video device has been used increasingly during the second half of the1980s. General Motors, for example, used video conferencing to gather 3500 managers at 24plants and JC Penney employed video conferencing to show its latest clothing line to itsdepartment stores. However, until now projections about the dimensions of use of videoconferencing were all too high. In 1984, companies that offered video conferencing servicesearned revenues of $ 370 million. Projections estimated these revenues to rise to $ 3.4 billion by1991, but in reality the market size was only $ 630 million. Problems with the transmission oflarge amounts of bits as well as no universally accepted standard (the CCITT introduced theH.261 standard in 1992 only) may be reasons for this development.
5.1.3.2.5 Satellite ConferencingSatellite conferencing refers to one-way broadcasting to many viewers. Interaction capabilitiesare usually limited. This is due to the fact that transmitted images must have very goodquality, since they are displayed on large screens. High resolution requires higher bandwidthand interaction is limited because of capacity constraints.
5.1.3.2.6 EmailEmail is a computer-mediated messaging system that uses computer text processing andcommunication tools to provide a high-speed information exchange serve. It is text-based andrequires access to a computer device with a terminal, keyboard and communication software. Tosend an email message, it is typed on a keyboard. It is received by being read on a terminalscreen or on a printed hard copy. Most email systems have features for composing and editingmessages and for directing the message to an individual or group. Email systems allow receivedmessages to be saved, filed, printed, forwarded, or deleted.
5.1.3.2.7 Bulletin Board SystemsComputer Bulletin Board Systems (BBS) are the logical extension of regular E-mail services. Ina BBS all E-mail that pertains to a specific topic can be put onto the proper bulletin board,where it can easily be found by someone scanning a list of special interest topics. Thiseliminates the need for specific mailing lists. However, the topic of the bulletin board must bedefined narrowly, otherwise the user will have to wade through long lists of messages of nointerest.
5.1.328 Computer ConferencingComputer conferencing was first developed by Murray Turoff in 1971 for the federal government.Known as EMISARI his system was designed to support the need for rapid dissemination ofinformation about the Nixon administration's wage/price freeze to ten regionalimplementation centers. Today, the best known system is called "Participate" and it is in use atcompanies such as Citicorp, Toshiba and the Harvard Law School.Computer conferencing exists in two forms : Synchronous conferencing and asynchronousconferencing. Synchronous conferencing allows for immediate feedback. Each participant sittingin front of his or her terminal receives all comments in real time and responds on the spot. In theasynchronous mode discussions can last weeks or months. The need to meet at a specific place at
organizational communication invariably have assailed the lack of theoretical infrastructurebehind the myriad research reports (Fulk, 1991). After an overview of three existingframeworks on media choice, we will discuss the implications and predictions of the interfacemodel.
5.2.1 Media Richness TheoryThe Media Richness Theory (MRT) of media choice in organizations has achieved considerableprominence in organizational communication. It is based on the information processing model ofthe organization (Galbraith, 1969) and suggests that organizational communication isinfluenced by two forces : uncertainty and equivocality.
Uncertainty can be defined as the absence of information. Communication media appropriatefor uncertainty reduction are those that facilitate the exchange of large amounts of accurate,objective, or numerical data. Equivocality, on the other hand, refers to ambiguity and multiple,conflicting interpretations of situations. Media appropriate for equivocality reduction need topromote the ability to clarify and explain. Richness is defined as the media's ability to reduceequivocality. Richness is a function of four factors : feedback capability, cues (voice or toneinflection), personalization (transmission of personal feelings), and language variety.Communication media are proposed to vary in their capacity to process rich information along aone-dimensional continuum that includes, in order of decreasing richness: face-to-facediscussion, phone calls, written addressed communication and written unadressedcommunication.
The fundamental claim of MRT is that, for effective communication, individuals should matchmedia to communication tasks. Six implications for managers can be deducted from the model:
1. Send non-routine and difficult communications through a rich medium, such as face-to-face.
2. Send routine, simple communication through a lean medium such as a memo.3. Use rich media such as discussions and meetings to make your presence felt
throughout the organization.4. Use rich media for implementing company strategy.5. Use multiple media on critical issues to make sure your message is heard correctly.6. Evaluate new technologies critically instead of assuming that they are
appropriate for the entire range of managerial tasks.
Several studies have found empirical support for MRT's ability to account for differences in theways individuals choose among traditional media and between traditional and new media(Daft, Lengel and Trevino 1987). However, it appears that MRT is unable to account forindividuals' choice among new media. In a study comparing individuals' choice between emailand voice mail El-Shinnawy and Markus (1992) found, contrary to the predictions of MRT, thatnot voice mail but rather email was the preferred medium in equivocal communicationsituations. Voice mail, although obviously the richer medium, was preferred for short,spontaneous messages, rather than for typical equivocal communication which tends to belengthy and ongoing. The results of the study indicated, however, that, in accordance withMRT, email was preferred over voice mail for the exchange of information to reduceuncertainty. The results of this study suggest that MRT may not be general enough to account forthe choice among computer mediated technologies.
5.2.2 Social Influence Model of Media ChoiceOne attempt to cope with anomalous findings has been the development of a contrasting modelfor newer communication media. The Social Influence Model of Technology Use (FulkSchmitzand Steinfield, 1990) begins with the alternative assumption that perceptions of electronicmedia vary across individuals in systematic ways and that this variance is as important formedia selection as is any constant component identified in the media richness model. The model
proposes that media perceptions and media choice are in part socially constructed. Socialinfluence through direct statements of co-workers or social definitions of rationality explainmedia choice.
The prediction of the model is that media use within groups will follow similar patterns,while across groups differing patterns will be found. There is some evidence to support thismodel (Rice and Shook, 1989; Ryu and Fulk, 1991). Implications for managers having to choose anew technology are (1) to consider the receiver of the message, (2) to think carefully aboutorganizational norms regarding what things should be written down and what can beaccomplished verbally, (3) to overcome social resistance through peer training and (4) toremember that organizational policies have important influences on media use.
5.2.3 A Contingency Model of Information Technology ChoiceGalbraith (1968) distinguishes information systems along two dimensions : The timing, whenthe system is used and the scope of information transmitted through the system. Timing can becontinuous or periodic, while scope can be divided into local and global. A warehouse clerk, forexample, who places orders every Friday needs to retrieve data periodically from a local database. The airline reservation systems are an example of a global, continuous system. Informationis extracted and updated continuously and each travel agent needs to have a global view ofother agents' booking activities.
Galbraith argues that the choice of information system is determined by two conditioningvariables : The amount of specialization within the organization and the amount of taskuncertainty (Figure 5-1).
Low task uncertainty H i g h t a s kuncertainty
Low process Local, periodic local, on-linespecialization system p r o d u c t o r
geographicorganizational dept.
High process global, periodic on-line, real-timespecialization system or local, on-line with
I buffers
Scope: local - access only to own data vs. globalTime: periodic (every "Monday" database update) vs. continuous (on-line)
Figure 5-1: Information Technology Choice
In a study of the commercial airline division of Boeing Galbraith established that there is noone best information system, but that the choice of it depends on the degree of task uncertainty,the degree of specialization and the ease of use of buffers. Moreover, in any organizationinternal consistency between the information system, the level of buffer use, the degree ofspecialization and the task uncertainty must exist.
5.2.4 Implications of the Interface ModelThe interface model, as described in chapter two of the thesis offers itself to determine whatmeans of communication should be chosen under what circumstances. The underlying idea is,that the technology in use should be in line with the type of interface involved. Thisassumption is similar to what other models of media choice are based on. The predictions aremade by a matrix spanning the information interface and the psychological interface dimension(Figure 5-2).
PsychologicalDimension
Highinvolvement
LowInvolvement
Repetitive Non-repetitive InformationInformation Information Dimension
Figure 5-2 : An Interface Model for Media Choice
Along the information interface dimension we can identify a continuum of communication andinformation technologies that serve the needs of repetitive and non-repetitive informationexchange. Repetitive information is characterized by large amounts of data and a frequent useof the interface. The exchange is fairly routine and the data elements are commonly defined sothat few misunderstandings occur. A communication medium must respond to these requirementsby four characteristics :
1. High availability of medium2. Low cost of use3. High speed of data procurement4. High ease of use
For non-repetitive information exchange these four criteria are less relevant. Non-repetitiveinformation is exchanged for special occasions such as top executive meetings or generalannouncements and the amount of data is generally small. Moreover, the data is often subject toindividual interpretation, since no clear definitions exist. If the information is exchangedamong a smaller group of people, interactive media are more appropriate. In one-to-manycommunication situations, such as a speech of the CEO, it must also be possible to make themedium available to larger numbers of audiences. Since the use of the medium is relativelyinfrequent cost consideration are secondary in non-repetitive information exchange.
Table 5-2 ranks the technologies presented earlier in this chapter along theirappropriateness for information transmittal from repetitive to non-repetitive information.Face-to-face communication can be used in both, repetitive and non-repetitive informationexchanges. For example, line workers that work next to each other on the shop floor exchangeinformation about the quality of the raw material on a regular basis. Face-to-facecommunication used in non-repetitive information exchanges can be found in a top executiveconference. But contrary to the workers here the medium is not easily available for theexecutives. They often have to fly in from different parts of the world incurring high"communication" costs. Memos, letters, Teletext and computer conferencing are somewhat in themiddle because transmitting information via these media is more costly for the parties in termsof time spent to communicate.
As described in chapter three psychological interactions are divided into those with highinvolvement and those of low involvement. Table 5-3 ranks the available technologies along
their usefulness for the different psychologicalinvolvement the
Repetitive Information Interface
Non-RepetitiveInterface
Information
interfaces. In situations of high psychological
Client ServerDatabase SystemsTelephoneFace-to-FaceVoice MailFaxEmail
MemoLetterTeletextComputer Conferencing
FlyersBBSSatellite ConferencingAudio ConferencingVideo ConferencingFace-to-Face
Table 5-2 : Technologies' Appropriateness for Information Interfaces
technology must be able to convey the feelings of the agents accordingly. Clearly media thatprovide information exchange through a number of senses(voice, written, sight) such as face-to-face communication or videoconferencing are better than single sense media. Secondly, mediathat allow immediate feedback are more appropriate for high involvement situations.Moreover, it appears that voice media are better suited than written media to express feelings.In low involvement situations media that cover up feelings are more desirable. Moreover, in thecase of low
I Medium / Technology
Low Involvement PsychologicalInterface
High Involvement PsychologicalInterface
Client ServerDatabase SystemsFlyersBBS
Computer ConferencingEmailTeletextMemoFaxLetterVoice MailSatellite Conferencing
TelephoneAudio ConferencingVideo ConferencingFace-to-Face
Table 5-3 : Technologies' Appropriateness for Psychological Interfaces
involvement, immediate feedback may not be desirable, since the informationshould have time to "sink-in" based on its content and not on the feelings associated with therelation between sender and receiver.
Combining table 5-2 and table 5-3 yields the technology choice matrix shown in figure 5-3. Thismatrix indicates, under which circumstances, which technology should be used. Managementcan use this matrix to determine, whether existing technologies are appropriate for theinterfaces. It also gives management a way of selecting new technologies for the organization.
PsychologicalDimension
HighInvolvement
LowInvolvement
RepetitiveInformation
Figure 5-3 : Media Choice through
Non-repetitive informationInformation Dimension
the Interface Framework
After chapter four had shown what parameters determine the organizational setup and thegeneral interface characteristics, chapter five has now described, how the informationtechnology factor fits into the picture. Now, that the theoretical Interface Managementframework has been laid out it remains to be shown, that the model can actually be used in a
I Medium/ Technology
face-to-face meetin.t*l*ph*"* video conferencii
audio conferenci:
fax satellite conferencimemo
lett ratel textcor iputer conferencing
email bulletin board systeclient serverdumb terminal flyer
real organization. This is the purpose of the remainder of this thesis.
Chapter VI. A CASE STUDY OF AN ALUMNI ORGANIZATIONThe primary goal of this case study is to demonstrate the applicability of the interfaceframework. The study explores the alumni organization of the Massachusetts Institute ofTechnology and identifies its agents and the interfaces between the agents. Relating to theproblems that exist within the organization the question addressed, is, whether the existinginterfaces make sense. Moreover, it will be determined whether the means of communicationused by the organization for specific interfaces are in accordance with the predictions of theinterface model and if not so, whether there may be room for improvement: Of the organizationor the interface model.
6.1 Data Collection MethodThe data for the case study was obtained through semi-structured interviews with members ofthe various departments involved. The study examines the interfaces between the InformationSystems group and the other departments and offices at the university. A special focus has beenplaced on the interface between the Information Systems group and the Alumni ActivitiesAssociation. Accordingly the majority of the interviews was conducted with members of thesetwo offices.
The persons interviewed were asked about their view of the organization as a whole and theirindividual function within this organization. Moreover, they were asked to evaluate therelationships between their own group and the other groups involved. A third group ofquestions focused on the problems perceived within the organization and possibilities forimprovement.
6.2 Alumni Related Activities
6.2.1 Activities Involving AlumniEvery year approximately 2000 students graduate from the Massachusetts Institute ofTechnology (MIT), one of America's most prominent universities. Keeping contact with theschool's alumni is done for two reasons : Raising money and serving the alumni. Indeed, fortyfour percent of the 81,000 alumni make an annual donation to the school, raising thusapproximately $120 million per year.
6.2.2 Groups Concerned about AlumniThree groups in the university are involved in the activities targeting former students : theAlumni Association, the Resource Development Department and the various schools of theinstitute.
The Alumni Association is in charge of providing services to the alumni and raising money fromapproximately 95% of the alumni through annual funds. The Resource Development Office is incharge of those alumni, whose gifts fall among the highest 5%. In addition to these centralizeddepartments the schools keep separate contacts to the alumni. The Sloan School ofManagement, for example, has created its own alumni relations department in 1992, whichtargets only students graduating from the Sloan School.
6.2.3 The Alumni Database (ADDS)Everybody relating to alumni relies on one central database, called the ADDS (Alumni DonorDevelopment Schools Database) system, for accurate and timely information on alumni. Thedatabase contains mainly biodata and gift information about the 81,000 alumni. The system isorganized as a networked database with over 40 files.
The technical responsibility for the database lies with the Administrative SystemsDevelopment group. Three other offices are in charge of the contents of the fields. TheTreasurers Office maintains about 3 files and the Resource Development group is in charge ofeight files. Most files, around 40, are updated and maintained by the Information Systems
group, which is part of the Alumni Association. Figure 6-1 gives an overview over the groupsusing information from the ADDS database.
Alumni Treasurer'sAssociation Office
Resource
ADDS Development
AdministrativeSystemsDevelopment
SchoolsFigure 6-1 : Users and Guardians of ADDS
Input for the database comes from a variety of sources. Approximately 95% of the initialstudent data are electronically transferred from the Registrar's office. Due to errors andprocessing difficulties five percent of the students enrolled in the university are "lost" in theRegistrar's database. The Information Systems group is responsible for entering these fivepercent who usually contact the alumni information group themselves to request to be input inthe database. In addition, around 30% of the address data contained in the mainframe has to beupdated every year by the Information Systems group. Updates of addresses come insporadically. Sometimes a department of the university provides a more recent address list, butmost often changes are made when an alumni indicates an address change at the occasion of anactivity. The Information Systems group also enters information about gifts and pledges.
6.3 Resource DevelopmentThe Resource Development group employs around 100 people. This group is in charge ofsoliciting alumni donors that give more than $ 5000 annually. Efforts of this group are muchmore targeted than of the Alumni Association. The Resource Development Office employs itsown data base people, essentially programmers who extract relevant data from the ADDSsystem for the purposes of the office. The primary interest lies in biodata and gift information.Through the so called "Prospect Control System" users can interface the database through aMacintosh which serves as a dumb terminal. A few standard reports are delivered to the userson hard copy on a regular basis and special requests are handled by the programmers of thegroup.6.4 Activities of the SchoolsInformation from the database is requested by special departments of the five schools of theuniversity. Departments may ask for an updated list of its former students or demand mailinglabels for their own activities. The Sloan School of Management, for example, started its ownalumni relations office in the fall 1992. This group is in charge of organizing activities such asdinners, clubs and reunions for the over 15,000 Sloan alumni. Another example is the UrbanStudies school that uses ADDS address labels for the mailing of quarterly news letters toalumni.
6.5 Alumni Association6.5.1 Organization of the Alumni Association
The Alumni Association employs 90 people and consists of three departments: AlumniActivities, Alumni Information Services and Resources and Technology Review (Figure 6-2).The Technology Review department is essentially responsible for the publication of the MIT
Technology Review magazine. For the purposes of this study, however, the focus will be onAlumni Activities and the Alumni Information Services and Resources group.
ExecutiveVicePreddent
William Hecht
Review Activities Services and Resou ngesJoseph S. Collin Katherine R. Cochrane
Funds Relations Information InternalJoe Recchio Systems Administration
John Blake, David LibbyMarc Jacobs
John Quinlan
Figure :6-2 Organizational Chart of the Alumni Association
The Alumni Activities group is the heart of the organization and in charge of fund raising andalumni relations. The group consists of 41 employees and used to be divided into funds andrelations until the mid 1980s. The two functions were probably merged to give rise to someeconomies of scope, because according to Joe Collins, head of the department, "alumniinvolvement is the key to large gifts". Fund raising activities yield annual gifts from 28,000alumni raising approximately $ 18 million per year. Alumni services are provided byorganizing class reunions and travel opportunities. Regional clubs are supported and specialconferences are organized. New ideas for service to alumni are an alumni ID card, an emailaccount for alumni and an 800 number.
The third group of the Alumni Association, Alumni Information Services and Resources group, isthe result of a recent merger between the InformationSystems group and the Internal Administration group of the Alumni Association. TheInformation Systems part is in charge of the ADDS system. Inputting information about alumniand generating reports for other departments are the two main tasks of the Information Systemsdepartment. The administration section manages the organization's budget and initiates actionprograms involving all parts of the organization such as the F.U.T.U.R.E. (Finding UniversalTechnologies Users Really Enjoy) group.
The Alumni Association is spread over four different locations. The core of the organization,consisting of the Alumni Activities department and the administrative section of the AlumniInformation Services and Resources department, is located in the first floor of building 10 in theareas 10-110 and 10-140 which are about a 20 second walk apart from each other. TheTechnology Review group is situated in building W59, far away from the rest of theorganization. The Information Systems group, the other half of the Alumni InformationServices and Resources group is to be found in the basement of building 12. Commuting betweenthe building 12 and the building 10 offices takes about two minutes, passing through relativelyugly basement floors.
6.5.2 Interfaces between the Units of the Alumni AssociationThe primary focus of this case study are agents and interfaces. More specifically, the studyfocuses on the relationship between the Information Systems group under the leadership of JohnBlake and the rest of the organization, in particular the Alumni Activities group (Figure 6-3).
InternalAdministration
David Libby
Figure 6-3 : Focus Interfaces of the Case Study
In the following sections the psychological and the information interfaces between theInformation Systems group and the Alumni Activities group will be analyzed. To summarize inadvance, the analysis will show that for most of the interfaces involved the predictions of theinterface media choice model can be sustained. In three cases, however, the interface modelrecommends different technologies. These three interfaces correspond to activities identified asproblematic by the members of the association. The lack of correspondence between theinterface and the technologies used may therefore explain some of the difficulties therelationship between these two groups has been experiencing.
6.5.2.1 Information InterfacesInformation between the two groups flows in two directions, resulting in output from ADDS andinput into ADDS. The bulk of the output requests for data to the Information Systems groupcomes from the Alumni Activities department. The requests fall into three categories. (1)Special and standard reports, for example on the giving records of alumni, (2) mailing lists forsolicitation or reunion purposes and (3) address labels used for mailing. This kind of informationis clearly of a repetitive nature. The data is organized in a database and thus clearly defined.Requests are frequent and have been going on for a long time. However, misunderstandings aboutrequests persist. This seems to have nothing to do with the nature of the information, but ratherwith insufficient documentation and training about the possibilities of the database among themembers of the Activities group.
Data is also transmitted from the Activities group to the information systems group. This datacomprises some address updates, but the majority comes from gift and pledge entries. Pledging ispart of the annual fund raising process. Alumni promise to give a certain amount of money toMIT over the course of the year. Once the money arrives the pledge is canceled out through agift entry.
The process works as follows : The pledge forms are designed, generated and sent out by JoeRecchio from the Activities group. The alumni, willing to pledge, sends this form directly tothe information systems groups indicating the amount of his pledge and the fund he wants topledge for. Occasionally an alumni includes the check at the same time, but most often he sendsthe gift at a later point in time to the Information Systems group. The pledge and the gift of the
40
alumnus are then entered into the database. The association receives around 12,000 pledges peryear with about 1,000 pledges not leading to a gift.
Recently there has been a major concern about mistakes occurring during the pledge and giftentry process. Joe Collins, head of the Alumni Activities group, stated that " handling pledgescorrectly is important because errors create an element of doubt in donors about the competence ofthe organization". However, he also explained that he only knew of one case, where an errorcaused a donor to stop supporting the institute. Be it as it is, the data integrity question hasraised a lot of concern.
Joe Recchio, from the Activities group believes that the data quality has been deterioratingsince the person in charge of data input was replaced. Since no documentation and data entrystandards existed in written form the new person in charge, John Quinlan, had difficulties doinghis job. Joe Recchio also believes that John Blake and John Quinlan have limited understandingof the annual fund, since they are not adequately trained. To solve the problem Joe Collinsbelieves that a verification mechanism is needed because mass entry of the pledges simply mustlead to errors. This verification device should, in his opinion, be developed by the InformationSystems group.
John Quinlan agrees that the lack of documentation makes it difficult for him to work.According to him, the pledge entry problem stemmed from a change in the input screen forefficiency reasons. In the former screen information could only be entered about one donor at atime. With the new screen, up to twelve donors can be entered. However, the person entering thedata can no longer see the exact status of the donor on the same screen. This leads to wrongentries. Moreover, programming mistakes, had caused errors in the updates of the data base.
Katherine Cochrane head of the recently merged Information Systems and Administrativedepartment, seems to be the only person understanding both sides. She believes that part of theproblem stems from a poor design of the pledge form, which leads to misunderstandings, andthat the other half of the problem is the change in the input screen.
6.5.2.2 Psychological Interfacesa) Pre-contact FeelingsThe pre-contact psychological relation between the two groups is negative and can becharacterized as highly involved. Even before any contact is established stereotypes about themembers of the other group shape the behavior of the individuals involved in the exchange.Three sources can be held accountable for the adverse feelings : (1) The impression thatteamwork can't exist in the institute, (2) a wrong opinion about the other groups' understandingof the goals of the organization and (3) an attitude of superiority among the members of theAlumni Activities group.
"Teamwork is an ongoing challenge at MIT !", this clear statement by Joe Collins indicates whycooperation between the two groups is difficult at the outset. Moving around in theadministration of the institute is a rare thing and therefore everybody develops loyaltytowards his or her group. Joe Recchio, for example, declared that the people in the InformationSystems group "don't know what's going on in Alumni Activities and vice versa". But heapparently makes few efforts himself to change this. Joe Recchio is in the unique position tohave worked in the Information Systems group himself before and he thus knows some of theirroutines. When problems with the pledge entry process occurred he tried to help out, but henever told John Quinlan that it was John Quinlan's resposibility had to find out what pledgeswere tied to which gifts. (Tying these two together had created the data integrity problems.)Instead Joe Recchio simply pointed out the errors and recommended to John Quinlan to "ask oneof [his] subordinates about how the process works" (John Quinlan). If everybody feels, however,that teamwork is not possible, then teamwork really becomes impossible.
Every person that was interviewed defined the objectives of the organization as "...twofold :One is bringing in funds and the second piece is serving the alumni" (Katherine Cochrane).However, it is not clear how well the members of the organization understand what theorganization's goals really mean. Joe Collins believes that "sometimes the people who put indata are not fully aware of what the mission is". John Blake, on the other hand, believes thatthe organization should provide more service to the alumni by opening access to database, but,he continues "...the Alumni Activities people don't want to give out that information".Katherine Cochrane stated that : " One year ago [I] felt that there was enormous tensionbetween the database people and the rest of the Alumni Association. They didn't talk and haddiffering goals." The problem may stem from a fuzzy definition of the goals. While success inthe fund raising business is easily measurable in terms of money raised, it is less obvious, how todefine good service. Katherine Cochrane believes that recording the number and quality ofvolunteers staying involved could be a possible measure. In addition, she continues, that in thisarea a less quantified goal may actually be preferable. However, it appears that defining thegoals precisely is vital for cooperation.
The third problem seems to be the composition of the members of the two groups. The peopleworking in the Alumni Activities group are generally younger, better educated and have moreopportunities. Fluctuation among them is high and "people in the Information Systems groupare often perceived as second class citizens by Alumni Activities people" (KatherineCochrane). The fluctuation coupled with a negative perception, leads Alumni Activitymembers to question the quality of the database. David Libby feels that the system is notadequate to support the goal of providing service, while Marc Jacobs from the InformationSystems group argues that "the database is no dinosaur system and could provide servicewithout problems".
b) Contact FeelingsPsychological relations at the contact level occur at the output and the input informationinterfaces. At the output interface a language problem exists. In the words of David Libby the".. Information group knows the fields and Alumni Activities group knows what the fieldsmean". This leads to misunderstandings between the person requesting information and theperson extracting this information from the database. This in turn results in frustration amongthe members of both groups and an enforcement of their original negative views about the othergroup.
The information input side's psychological dimension suffers from the already described lack ofstandards and the distance between the groups.Joe Recchio thinks that "the lack of documentation has made it difficult for John Quinlan toassume the gatekeeper role held by his predecessor". Therefore, Joe Recchio has taken on acontrol responsibility, showing to the members of the entry group where mistakes have beenmade. Clearly, feelings between a critic, who is not a superior, and the receiver of the critiquecannot be very good. The second area of concern is the frequency of personal contact between themembers of the groups. John Quinlan feels that there is no constant communication with thepeople from Alumni Activities. The people from the Activities group "mainly communicatewith the us when they either need something done in a hurry or a problem has occurred" (JohnQuinlan).
c) After Contact FeelingsCooperation between the two departments is necessary and therefore contacts between themembers of the groups should not worsen the psychological dimension. Some mistakes havebeen made in the past. Using Joe Recchio as a liaison person, with a certain bias towards theActivities group, can not be a strong motivator for cooperation for the Information Systemsgroup. Moreover, it is unclear why John Quinlan was excluded from the interdepartmental
F.U.T.U.R.E. group for a long time. Data integrity, which was one of the group's concernsclearly is his domain. Exclusion cannot lead to improved cooperation. A good idea was themerger of the Information Systems group and the Internal Administration under the new leaderKatherine Cochrane. Katherine Cochrane understands the needs of the Activities group andhas the hierarchical authority over the Information group to force cooperation when necessary.
6.5.3 Interface Management6.5.3.1 Conceptual Interface Management
6.5.3.1.1 Choosing the Right Coordination StrategyA change in the organizational structure towards a clearer defined hierarchy would probablyhelp since the Alumni Association operates in a fairly certain environment, with highinterdependence and potential for conflict. For a non-profit organization the chain of commandmay be a concept difficult to accept. However, the people of the information systems group needa strong representative in the administrative hierarchy. Katherine Cochrane's integration ofthe internal administration and the database group goes into the right direction. ThroughKatherine Cochrane the interface between the two groups has been redesigned by formalizingthe official interface and making communication part of the reporting process in theorganization.
6.5.3.1.2 Choosing the Right Coordination MechanismTwo types of coordination mechanisms are currently used in the organization: Communicationbetween the heads of the departments and liaison personnel. Joe Recchio and to some extendDavid Libby have become the liaison persons representing the Activities group, because bothare somewhat more knowledgeable about computer issues than the others. This liaisonsituation suffers from two aspects. First, the personnel is biased towards the Activities group.Second, and maybe even more important, the integrators help, whenever it is in their bestinterest. John Quinlan has the impression that "Joe Recchio tries to help out mainly in thepledge process, because pledge processing is one of Joe Recchio's responsibilities in theActivities group." Possible solutions would be the abolition of the liaison personnel interface orthe establishment of an official liaison position (interface smoothing), with clearly definedresponsibilities. Communication to clarify issues between the two groups will always benecessary. It may be better that every member of the Activities group learns to interact withthe data base people. Redesigning the interface in this way would assure more frequentcommunication and better mutual understanding through increased contacts.
Interdepartmental communication exists already. The F.U.T.U.R.E. group which consists ofleading members of the various parts of the organization is a step in the right direction. Thisgroup tries to identify strategies for improving the organization in the future. However, theorganization has not yet realized that the group can be used for integration purposes. Such agroup has the potential of creating a team spirit across the boundaries of the departments.Two additional coordination mechanisms should be put in place. First, goals, expectations andprocedures must be defined more rigorously and documented thereafter. Especially the highfluctuation among the members of the Alumni Activities group make such documentationnecessary. It appears that many misunderstandings and high involvement psychologicalrelations could be avoided through an open clarification of all issues. The Alumni Associationoperates in a fairly stable environment, conflict potential is high and interdependence betweenthe groups clearly exists. In this situation organizational theory (see chapter four) prescribes amechanistic setup partly based on standards and rules. The second improvement can come frominterdepartmental training. Members of the Information Systems group must learn about theActivities group and vice versa. This will eliminate speculations about the qualifications ofthe partner and thus avoid conflict, moving the psychological interfaces towards lowinvolvement.
6.5.3.2 Choosing the Right Interface TechnologiesCommunication between the two groups can be divided into communication related to data
retrieval, communication for data input and other communication. The following sections willdescribe which interface technologies the organization chooses in each one of the categories.The predictions of the interface media choice model will then be compared with reality.
In the past the Alumni Activities used a written "blue form" to request data, such as reports andmailing labels from the Information Systems group. A programmer would then sit down andwrite a program to extract the requested information from the database. To reduce the volumeof direct requests and the workload for programmers the Information Systems group developeda menu driven interface, an "on-line blue form". Members of the Activities group can now sitdown in front of a dumb terminal and access the data base directly without contacting theprogrammers of the data base group. Blue forms and on-line blue forms can be used for around90% of the requests. A client server solution would be desirable from the point of view of theActivities group, since formatting data and generating nice looking reports can be done easily ona Macintosh. Therefore many users have downloaded part of the database onto theirMacintosh. However, as David Libby says ".. it is a problem to get data from the mainframedown to the MAC." Consequently updating of the "Macintosh data bases is not so easy and notdone frequently", leading to data inconsistencies.
For more complex queries or in the case of problems the groups interact through telephone orface-to-face communication. In the past, secretaries, with often insufficient training, from theActivities group were asked to call or go see someone in the information group. KatherineCochrane has now initiated that for difficult special requests the Activities person demandingthe information should go see a programmer and discuss the query in person.
Data input requires communication for the actual data and for control purposes. In the case ofthe pledge process a predesigned form is used to indicate what data has to be entered into thedatabase. Misunderstandings occur because the form is designed by the Activities group, but itmust be interpreted by the data entry people. Data entry is checked on a regular basis by theActivities group. Joe Recchio, for example, checks the data entry reports every week. In thecase of small problems he writes a short note to the information group. For more severeproblems, he uses the telephone or even goes to see John Quinlan in person. The decision aboutwhat is severe and what isn't is, by the way, up to Joe.
Other communication between the two groups is mainly done on the manager level. The lucidrole of Katherine Cochrane has certainly helped to improve the managerial communicationbetween the departments. Meetings and telephone calls are frequently used means ofcommunication. Recently, the organization has introduced Quick Mail, an easy to use emailsystem for Macintosh. The Quick Mail system connects the three MAC networks of theTechnology Review, the Alumni Activities and the Information Systems group into onenetwork. So far around 1500 messages per/week including broadcast are transmitted throughthe system. Katherine Cochrane believes that the "Quick Mail link to building 12 [InformationSystems group] makes a huge difference. People don't feel so isolated any more". However, JoeRecchio estimates that there is only "a limited amount of Quick Mail [sent] to building 12".Moreover, John Quinlan, from the Information Systems group apprehends that he can't getfeelings across using Quick Mail. The connection between the Technology Review and theActivities group seems to be better with, according to David Libby, "..500 Quick Mail messages[sent] per week between W59 and building. 10".
In order to analyze these six communication situations it is useful to place each one in the mediachoice interface model (Figure 6-4). It may be surprising to find communication of pledge dataand critique of data entry
PsychologicalDimension
pecialDataARquestHighInvolvement Enty
PegdEnfy Critque
Lowinvolvement
Repetitive Non-repetitive informationInformation Information Dimension
Figure 6-4 Interfaces Categorization of the Alumni Association
mistakes in the upper left quadrant. Pledge data is communicated through a standardized formon a frequent basis. However, the misunderstandings resulting from the misinterpretationscreate an environment of high involvement. The recommendation of the interface model wouldtherefore be to alleviate the tensions and to move this communication down into the lower left-hand quadrant. As far as critique of errors in data entry is concerned, it is obvious that thisshould be a non-repetitive communication. Errors are to be eliminated at the source. Continuouscritique creates high involvement, which worsens the working relationship. Critique should, ifpossible, be moved into the lower right hand quadrant. Here critique would not occur often,because errors are rare and the mentioning of errors would not result in adverse feelings but beseen as a communication necessary for the best of everybody.
One can also match the interface technologies used in the organization with the purposes ofcommunication (Figure 6-5). The means of communication chosen for managerial communication,for special data requests and for normal data requests are in line with the predictions of theinterface model.
PsychologicalDimension
High le hon E DInvolvement
nf al
memo municationmemoN
LowInvolvement Quic mail
Repetitive Non-repetitive InformationInformation Information Dimension
Figure 6-5 : Technologies Used at Interfaces
Problematic, in the light of the model, are the use of the pledge form and Quick Mail. Asmentioned above, the pledge process interface actually belongs in the lower left quadrant, inwhich case the pledge form would be appropriate. (The pledge process form can be somewhatcompared to a database). Finally, Quick Mail, does not seem to fit according to the interfacemodel. Quick Mail, incorporates in a way the features of email and bulletin board systems.Both are however adequate for communication with low psychological involvement. Clearly,this is not the case between the Activities group and the Information Systems group. This mayexplain, why Quick Mail is not used actively between these groups. Katherine Cochrane isoverly enthusiast, if she believes that Quick Mail will provoke an "..IT induced culturalchange". To eliminate psychological barriers between the two groups other means ofcommunication must be employed. At the outset face-to-face meetings between all members ofthe two groups could help to diminish some tension and misunderstanding. Frequent use of thetelephone should be encouraged in cased of repetitive information interfaces. These media helpto reduce the tension. At a lower level of psychological involvement Quick Mail may thenbecome more widely used.
6.6 Interfaces between Schools and Information Systems GroupAs described above, the five schools of the institute maintain independent relationships totheir alumni. The Sloan school of management is probably the best organized school with anindependent alumni relations group. To access data from ADDS the group relies on help fromthe Resource Development Office and the Information Systems group of the AlumniAssociation.
Sloan has been equipped with a menu driven user interface to extract data from ADDS.However, combined searches are difficult and it is not possible to make use of all the details ofthe database. For example, the menu interface allows searches per region, but a search per citycode is not possible, even though the database contains the necessary information. As LindaCarter, head of the Sloan Alumni Relations states " you need to be an expert to do specificsearch and therefore must ask for a professional programmer". In this case, the group makes aspecial request over the telephone, which will usually be fulfilled within the next day, by oneof the programmers of the central organizations.
Working relations between the central database programmers and the Sloan school are in goodterms. In the words of Linda Carter, the database people are "extremely helpful people". Thepsychological interface between the groups seems to be one of low involvement except for some
frustration caused by Sloan's inability to use ADDS to its fullest extend.
These interfaces are again in line with the interface model. For routine data requests Sloan usesan on-line menu system. For special requests it calls up a programmer of the information groupsand the output is delivered through the mail the following day. No direct personal contacts arenecessary, since the psychological dimension of the interface is of low involvement.
Chapter VII. CONCLUSIONThe first underlying question of this thesis was whether a common denominator for the largenumber of popular management philosophies can be identified. The interface managementframework is such a denominator. The new framework allows to reinterpret the essence of manymanagement ideas in a simple and stringent way. Interfaces are the points of contacts betweenagents and can be divided into material, information and psychological interfaces. Managingthese interfaces through interface abolition, interface redesign and interface smoothingemerges as a promising source of improvement of organizational performance.
The second question this thesis attempted to answer was how organizations should design theircommunication and information systems. The paper has described how uncertainty,interdependence and conflict influence the organizational structure choice and how this choicepreconditions the selection of the interface technologies employed. In chapter five the thesisshowed how interface technologies can be chosen based on the characteristics of the interface.Once the optimal interface design is identified organizations can then use the interfacemanagement techniques to achieve this configuration.
The case study has shown that the interface framework is capable of correctly describing andpredicting the use of communication technologies for specific interface types. In the case ofprocessing pledge forms, where members of the organization expressed concern about problems,the interface model showed that the chosen interface technologies were not in line with thepsychological and informational characteristics of the interface. The model proposed tomodify either the interface setting or the technology in order to reach congruence.
The intention of this thesis was to propose a new framework for thinking about organizationalstrategies, management philosophies and interface technology choice. Further study will haveto test the model more rigorously in a larger number of settings. Moreover the elements of themodel that were beyond the scope of this paper will have to be refined. Especially in thematerial interface dimension, the framework needs further improvements.
APPENDIX: Logical Flow of the Thesis
InformationInterfaces
OrganizationalTheories
PsychologicalInterfa
Materialces Interfaces
Interfacesa(;re important)
Interface Framework
Perfect Information Interface
Teical Realization
Perfect Material Interface
7000*7InterfaceManagementI
Interface SmoothingInterface RedesignInterface Abolition
ManagementTheories
4further research
I Environment New utiaiiengesNew Challenges || Environment
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