Management Department

 

Date of this Version

1976

Citation

Academy of Management Journal, 1976 Volume 19, Number 2, pp 328-332.

Comments

(c) 1976 Academy of Management. Used by permission.

Abstract

Computerized information systems have a tremendous impact on management decision-making in all modern organizations. Electronic data processing (EDP) departments generate, coordinate, and disseminate much of the information that is used in modern management decision-making. How much influence is this computer generated information per se having on the choice activity of the human decision-maker? To date, very little is known about the answer to this question. Yet, if management is to improve the effectiveness of the decision-making process, the implications of computer generated information must be better understood. Organizationally, there is evidence that the computer has changed traditionalline- staff relationships. In reality, EDP departments may be becoming more line (decision-making authority) oriented as opposed to their traditional staff (advice) role. Such a development can be explained by the reactions of decision-makers to computer generated information. A hypothesis worthy of testing would be that if the decision-maker places a great deal of confidence in the computer, then the EDP department functions more in a line capacity. By the same token, if the decision-maker has little confidence in the computer, then the EDP department becomes more of a staff function. In other words, it may be that the way in which the EDP department influences the decision-making process depends, in part, on the reaction of the human decision-makers to the computer itself. Today's managers can be placed on a continuum of knowledge and practical familiarity with computerized information systems. At one extreme are those managers who are extremely knowledgeable about all aspects of the computer's capabilities, limitations, and functions, and have a great amount of practical experience. On the other extreme are those managers who have virtually no understanding or experience with the computer and its role in decision-making. For the purpose of this study, the subjects are considered to fall into one of two categories-those that tend to have some knowledge and familiarity with the computer's capabilities and limitations (termed "experienced") and those who tend to have very little, if any, familiarity with the computer's capabilities and limitations (termed "nonexperienced") . It was hypothesized that the computer experienced subjects would be more suspicious or less confident of computer derived information than would the nonexperienced. Computer experienced people have often been frustrated by the computer and know its limitations. On the other hand, nonexperienced people may hold the computer in awe and thus place too much 'confidence in computer generated information. The study reported in this paper was designed to test this hypothesis.

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