Organizational information processing theory

Acronym
OIPT

Alternate name(s)
Not to be confused with Miller's Information Processing Theory

Main dependent construct(s)/factor(s)
Information processing performance

Main independent construct(s)/factor(s)
information processing needs, information processing capability

Concise description of theory
This theory identifies three important concepts: information processing needs, information processing capability, and the fit between the two to obtain optimal performance. Organizations need quality information to cope with environmental uncertainty and improve their decision making. Environmental uncertainty stems from the complexity of the environment and dynamism, or the frequency of changes to various environmental variables.

Typically, organizations have two strategies to cope with uncertainty and increased information needs: (1) develop buffers to reduce the effect of uncertainty, and (2) implement structural mechanisms and information processing capability to enhance the information flow and thereby reduce uncertainty. A classic example of the first strategy is building inventory buffers to reduce the effect of uncertainty in demand or supply; another example is adding extra safety buffers in product design due to uncertainty in product working conditions. An example of the second strategy is the redesign of business processes in organizations and implementation of integrated IS that improve information flow and reduce uncertainty within organizational subunits. A similar strategy is creating better information flow between organizations to address the uncertainties in the supply chain.

Source: Premkumar, G., Ramamurthy, K., & Saunders, C. S. (2005). Information processing view of organizations: An exploratory examination of fit in the context of interorganizational relationships. Journal of Management Information Systems, 22(1), 257-294)

Diagram/schematic of theory


Source: Galbraith, J.R. Designing Complex Organizations. Reading. MA: Addison-Wesley, 1973

Originating author(s)
Galbraith, Jay

Seminal articles
Galbraith, J.R. Designing Complex Organizations. Reading. MA: Addison-Wesley, 1973. Galbraith, J. R. (1974). Organization design: An information processing view. Interfaces, 4(3), 28-36.

Originating area
Organizational Behavior

Level of analysis
Firm

IS articles that use the theory
Anandarajan, M., & Arinze, B. (1998). Matching client/server processing architectures with information processing requirements: A.. Information & Management, 34(5), 265.

Anandarajan, Murugan, & Arinze, Bay. (1998). Matching client/server processing architectures with information processing requirements: A contingency study. Information & Management, 34(5), 265.

Andres, H. P., & Zmud, R. W. (2001). A contingency approach to software project coordination. Journal of Management Information Systems, 18(3), 41.

Argyres, S, N. (1999). The impact of information technology on coordination: Evidence from the B-2 "stealth" bomber. Organization Science, 10(2), 162.

Bolon, S, D. (1998). Information processing theory: Implications for health care organizations. International Journal of Technology Management, 15(3,4,5), 211.

Burke, K., Aytes, K., & Chidambaram, L. (2001). Media effects on the development of cohesion and process satisfaction in computer-supported workgroups: An analysis of results from two longitudinal studies. Information Technology & People, 14(2), 122.

Chidambaram, Laku. (1996). Relational development in computer-supported groups. MIS Quarterly, 20(2), 143.

Cooper, R. B., & Wolfe, R. A. (2005). Information processing model of information technology adaptation: An intra-organizational diffusion perspective. Database for Advances in Information Systems, 36(1), 30.

Fairbank, J.F., Labianca, G., Steensma, H.K., & Metters, R.D. (2006). "Information Processing Design Choices, Strategy and Risk Management Performance." Journal of Management Information Systems, 23: 293-319.

Francalanci, C., & Galal, H. (1998). Information technology and worker composition: Determinants of productivity in the life insurance industry. MIS Quarterly, 22(2), 227.

Gallivan, M. J., Spitler, V. K., & Koufaris, M. (2005). Does information technology training really matter? A social information processing analysis of coworkers' influence on IT usage in the workplace. Journal of Management Information Systems, 22(1), 153.

Gattiker, T. F., & Goodhue, D. L. (2005). What happens after erp implementation: Understanding the impact of inter-dependence and differentiation on plant-level outcomes. MIS Quarterly, 29(3), 559-585.

Gattiker, T. F., & Goodhue, D. L. (2005). What happens after erp implementation: Understanding the impact of interdependence and differentiation on plant-level Outcomes1. MIS Quarterly, 29(3), 559.

Gattiker, T. F., & Goodhue, D. L. (2004). Understanding the local-level costs and benefits of ERP through organizational information processing theory. Information & Management, 41(4), 431.

Goodhue, L, D., Wybo, D, M.,& Kirsch, J, L. (1992). The impact of data integration on the costs and benefits of. MIS Quarterly, 16(3), 293.

Hamilton, M. A., & Nowak, K. L. (2005). Information systems concepts across two decades: An empirical analysis of trends in theory, methods, process, and research domains. Journal of Communication, 55(3), 529-553.

Hobman, E. V., Bordia, P., Irmer, B., & Chang, A. (2002). The expression of conflict in computer-mediated and face-to-face groups. Small Group Research, 33(4), 439.

Jain, H., Vitharana, P., & Zahedi, F. (. (2003). An assessment model for requirements identification in component-based software development. Database for Advances in Information Systems, 34(4), 48.

Jarvenpaa, L, S., Ives, & Blake. (1993). Organizing for global competition: The fit of information technology. Decision Sciences, 24(3), 547.

June Wei, & Salvendy, G. (2004). The cognitive task analysis methods for job and task design: Review and reappraisal. Behaviour & Information Technology, 23(4), 273-299.

Kahai, S. S., & Cooper, R. B. (1999). The effect of computer-mediated communication on agreement and acceptance. Journal of Management Information Systems, 16(1), 165.

Kyu, K. K., & Umanath, S, N. (1992). Structure and perceived effectiveness of software development subunits: A task contingency analysis. Journal of Management Information Systems, 9(3), 157.

Kyu K, K., & Umanath, N. S. (1992). Structure and perceived effectiveness of software development subunits: A task contingency analysis. Journal of Management Information Systems, 9(3), 157.

Lin, H. X., Choong, Y., & Salvendy, G. (1997). A proposed index of usability: A method for comparing the relative usability of different software systems. Behaviour & Information Technology, 16(4), 267-277.

Macpherson, K. (2004). An information processing model of undergraduate electronic database information retrieval. Journal of the American Society for Information Science & Technology, 55(4), 333-347.

Premkumar, G., Ramamurthy, K., & Saunders, C. S. (2005). Information processing view of organizations: An exploratory examination of fit in the context of interorganizational relationships. Journal of Management Information Systems, 22(1), 257.

Reddy, S. B. (1995). Information Technology and the Structure of the Multinational Enterprise Palgrave Macmillan Ltd.from http://search.epnet.com/login.aspx?direct=true&db=buh&an=9602160497

Rice, R. K., & Shook, D. E. (1990). Relationships of job categories and organizational levels to use of communication channels, including electronic mail: A meta-analysis and extension. Journal of Management Studies, 27(2), 195.

Rogers, P. R., & Bamford, C. E. (2002). Information planning process and strategic orientation the importance of fit in high-performing organizations. Journal of Business Research, 55(3), 205-215.

Sicotte, H., & Langley, A. (2000). Integration mechanisms and R&D project performance. Journal of Engineering and Technology Management, 17(1), 1.

Stock, G. N., & Tatikonda, M. V. (2004). External technology integration in product and process development. International Journal of Operations & Production Management, 24(7), 642.

Tatikonda, M. V., & Rosenthal, S. R. (2000). Technology novelty, project complexity, and product development project execution success: A deeper look at task uncertainty in product innovation. IEEE Transactions on Engineering Management, 47(1), 74.

Thow-Yick, & Liang. (1996). The basic entity model: A theoretical model of information processing, decision making and information systems. Information Processing & Management, 32(4), 477.

Tractinsky, Noam, & Jarvenpaa, L, S. (1995). Information systems design decisions in a global versus domestic context. MIS Quarterly, 19(4), 507.

[http://ssrn.com/abstract=1611646 Trkman, P., McCormack, K., de Oliveira, M. P. V., & Ladeira, M. B. (2010). The impact of business analytics on supply chain performance. Decision Support Systems, 49(3), 318–327.]

Tuggle. F. D, & Gerwin, D. (1980). An information processing model of organizational perception, strategy and choice. Management Science (Pre-1986), 26(6), 575.

Umanath, S, N., & Campbell, L, T. (1994). Differential diffusion of information systems technology in multinational enterprises: A research model. Information Resources Management Journal, 7(1), 6.

Viator, R. E. (2000). Accounting information systems doctoral dissertations: 1999. Journal of Information Systems, 14(2), 151.

Walther, J. B., Loh, T., & Granka, L. (2005). Let me count the ways: the interchange of verbal and nonverbal cues in computer- mediated and face-to-face affinity. Journal of Language & Social Psychology, 24(1), 36-65.

Zmud, R. W. (1979). Individual differences and mis success: A review of the empirical literature. Management Science (Pre-1986), 25(10), 966.

Links from this theory to other theories
Information processing theory, Absorptive capacity theory, Transactive memory theory

Original Contributor(s)
Hossam Ali-Hassan Please feel free to make modifications to this site. In order to do so, you must register. Return to Theories Used in IS Research