Evaluation of Information Entropy in Organizational System

Minodora Ursacescu and Mihai Cioc

Management and Economics Review, 2016, vol. 1, issue 2, 82-91

Abstract: Entropy, as a thermodynamic concept, indicates the degree of system disorganization. The concept of entropy is associated with a measure of disorder and uncertainty in a physical system that leads to progressive loss of the relationships that integrate a system. The study of entropy becomes relevant for organization systems, which are described as interconnected elements, having a defined goal, and interacting with a dynamic environment. These systems are essentially based on the acquisition and application of information to ensure their self-determination and future development. In such a context, the approach of entropy is related to the Information Theory, referring to a measure of the amount of information that exists in an organizational system. This paper discusses the concept of information entropy and proposes a manner to evaluate its level under the influence of certain events that reveals particular organizational aspects. A case study for testing the relationship between information and entropy in the case of a company has been elaborated. The findings reveal that the increasing of order within a company system, through highly structured states leads to low level of information entropy.

Keywords: entropy; event; information entropy; organizational system; probability. (search for similar items in EconPapers)
JEL-codes: D8 M21 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:rom:merase:v:1:y:2016:i:2:p:82-91

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