Informal information flow and strategy in the international firm

Abstract

The demands of structure and control in the organisation accord information from official channels an importance beyond its value in sustaining operations. Yet, formal mechanisms seem unable to supply all the information senior management requires for the formulation of strategy. Frustrated by the paucity of the information the organisation is able to supply, those responsible for strategy may sometimes take extraordinary steps to acquire appropriate information. These, and other means of acquiring information informally, seem to be incompatible with the formal information systems of the organisation. Using evidence from large international firms, the paper looks at the acquisition of information for strategy by both formal and informal means. It concludes that formal mechanisms seem likely to suppress and distort the informal, leaving senior managers deprived of information important for strategy.

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