The study concluded that the Web, as a new medium for organizational communication, offers a wide variety of organizational information. While a majority of the Fortune 500 company Web sites studied provided general information (79.9 %) and promotion and image marketing (67.8 %), fewer Web sites offered product and service information (42 %). Only 15.9 % of the organizations were using the Web for transactions.
Eight Web content characteristics were identified. Typical
levels achieved on these characteristics were: (a) effective promotion,
resulting in widespread reach at low cost, (b) reliable product
information and customer support round-the-clock, (c) graphically rich
content with significant shift from text to visuals, (d) a failure to
project corporate identity on the Web, (e) little interactivity, with
few features for information exchange, evaluation and feedback, (f)
sparse use of multimedia technology, (g) a dearth of updated
information, an outmoded Web interface that confused information
seekers, and (h) limited access for people with disabilities.
Statement of the Problem
The purpose of research reported in this paper was to examine the role of World Wide Web sites as a new medium for organizational communication. The study reports the results of a content analysis of 264 randomly selected Web sites from the 1999 Fortune 500 list of companies for types of organizational information and Web content characteristics.
Research Preamble and Paper Outline
The research was undertaken in order to enhance our understanding of the Web content characteristics of large organizations such as Fortune 500 companies. As outlined later, the existing literature about organizational communication addresses computer-mediated communication in organizations but with little or no attention to the Web as a communication medium. The present study attempts to bridge this gap and contributes to organizational communication research by identifying Web content characteristics of Fortune 500 companies.
This paper first examines the significance of researching the role of Web sites in organizational communication. Second, it briefly reviews contemporary research and scholarly discussion on Web communication, Internet content, Fortune 500 companies, and organizational communication. Third, it explains the method of content analysis used. Finally, it reports the results of the content analyses with reference to four types of organizational communication and eight content characteristics. The conclusion analyzes the role of Web sites as a communication medium in large organizations in general.
Research on the role of Web sites as a new medium for organizational communication has great scholarly importance because it enhances knowledge about organizational communication in general, and computer-mediated communication in particular. A better understanding of media choices can contribute to the design of communication and information systems and can lay the groundwork for future research about how media choices relate to communication effectiveness . Given the importance of effective communication and the widening array of communication media available, research on the multiple determinants of media choice is important.
Few researchers have reported research results on the role of Web sites as a medium for organizational communication. A majority of research work in this area has been undertaken from a media selection perspective, and is based on analyses of the adoption of various media in organizations and prevailing procedures with these media. There has been little consideration of Web content characteristics in the literature although this approach can provide a framework to understand fully the role of Web sites as a communication medium. Some researchers have acknowledged the Web’s effect on organizational outcomes, for example, "the role of the Web in rich dialogues on issues," Web site design, and "social responsibility content" in corporate Web sites. However, research into types of organizational information and content characteristics of Web sites of large organizations, especially Fortune 500 companies, is at best sparse.
The interactive multimedia features of the Web have provided organizations with a new medium with capabilities richer than its traditional counterparts. The research reported in this study enhances general understanding of the role of Web sites as an information source for organizational communication. It offers a comprehensive analysis of organizational communication types in web sites of Fortune 500 companies and it examines Web content characteristics such as interactive features and user interface. Finally, it ascertains definitive characteristics of Web sites for organizational communication. These areas have not been adequately examined in earlier studies. The present study also analyzes a larger sample compared with earlier studies about Fortune 500 companies.
Since 1992, several researchers have explored how the Internet has influenced and in some cases transformed organizational communication For instance, researchers have concluded Web sites offer significant advantages as a medium for organizational communication. Some of these major advantages are: global dissemination of data at lower cost, updated information, multimedia content, and unlimited access to a global audience. On the other hand, some scholars have identified problems, such as the Web's inability to reach those without Internet access, data security breaches, copyright malpractices, document design inconsistencies, and potential for negative and malicious rumors.
Researchers have concluded that organizational communication efforts in marketing,
advertising, and public relations have been enhanced by the Web’s speed and
efficiency. The Web has also enabled organizations to attract, persuade, motivate,
and communicate with publics . As a new medium for organizational communication,
the Web is creating new opportunities for organizations to innovate and prosper
. This opportunity has led to new Web-based business models . In May 1999, Fortune
magazine identified nine ways organizations "win on the Web."
The next four organizations winning on the Web were NextCard, <http://www.nextcard.com/> a San Francisco company, selling credit cards only on the Internet; Amazon.com, <http://www.amazon.com/> the leading consumer e-commerce Web site; FedEx <http://www.fedex.com/> offering do-it-yourself package tracking; and Cisco Systems <http://www.cisco.com/> which enables its officials with a couple of mouse clicks, to call up the company's revenues, margins, orders, discounts on those orders, and top ten customers for the previous day . These examples also illustrate an important trend in organizational communication: The Web is now making a significant impact in large organizations that rank high in the Fortune 500 list. High ranking organizations include: Ford Motor (ranked 2nd ), Dell Computer (78th ), FDX (94th ) the parent company of FedEx, Sun Microsystems (164th ), Cisco Systems (rank 192nd ), and Pitney Bowes (rank 359th ).
A number of studies on Web communication in large organizations have examined Fortune 500 companies, which represent the largest firms in the United States, Marlow, in his book Web Visions (1997), investigated the foundations of successful Internet business practices in an effort to draw connections between the beginnings of Internet use and results. Esrock and Leichty (1998) found that 82% of the Web sites of Fortune 500 companies addressed at least one corporate social responsibility issue and more than half of the Web sites had items addressing community involvement, environmental concerns, and education. Few corporations, however, used their Web pages to monitor public opinion on issues or advocate policy positions .
Palmer and Griffith (1998) posited an emerging model of Web site design for marketing, based on a content analysis of 250 Web sites of Fortune 500 companies. They observed that few companies were taking advantage of the full range of the Web's media richness and few sites were using audio and video. Those firms with the most information-intensive market offerings were using the capabilities of the Web most fully.
As a medium for organizational communication, the Web has a greater degree of media richness, as illustrated by past studies. Heath (1998) observed that the Web could be used to conduct rich dialogues on issues. The low cost of information and opinion delivery on the Web has put on par companies, governmental agencies, and activists. Thus, deep pockets ceased to play a key role in getting information out of interested readers .
With its networked information universe, the Web has emerged as a knowledge-building asset imparting holographic knowledge in learning organizations and knowledge-based firms. Several researchers have stressed the importance of the "learning organization" and the need for "responsiveness." In many ways, learning organizations have transformed like organisms, adopting general development processes .
Web sites of organizations now can be used as an information asset to accomplish "knowledge-building" goals in an organization. With the growth of knowledge-based organizations, Leonard-Barton (1995) considers management of knowledge assets as important because "knowledge-building" or "knowledge-inhibiting" activities affect core capabilities. Such activities operate in synergy in some technology-based companies with "organic learning systems," and with "holographic organization."
Web sites equip a wide variety of both internal and external publics with holographic knowledge, and essential for quick and effective response to changes in the external environment. Practically, this means everyone knowing or being able to find out about everything that relates to their work. Organizations are obligated to target their messages to individuals as well as to audiences or publics . The Web is perfect for such information dissemination, which could be unlimited or refined and customized for different publics. According to Russell and Peters (1998), "holographic knowledge" is more achievable due to widespread access to new information technologies, which speeds up communications and allows people to network more efficiently.
With its open platform and easy access, the Web has assumed an important role in formal and informal communication systems in an organization. Hagins (1996) used critical mass theory to stress that it is crucial for innovations to achieve sufficient utility in order to succeed. For instance, easier access to information can facilitate education, training, and employment, thereby transforming the information-poor from economic dependents, from tax consumers to taxpayers .
The literature survey has suggested three areas for study: types of organizational information, Web content characteristics, and the role of Web sites as a new medium for organizational communication. Three research questions were formulated to analyze these areas.
First, what kind of organizational information is presented through Web sites of Fortune 500 companies? For example, a May 1996 study by Petravick and Gillett found that 83 of the companies listed in the Fortune 150 made financial information available on their Web sites .
Second, what are the Web content characteristics of Fortune 500 companies? Palmer and Griffith (1998) identified differing levels of information content and context for Web site users . This question explores the nature of Web-site content by identifying the Web content characteristics.
Finally, to what extent are Web Sites of Fortune 500 taking advantage of the Web content characteristics? This question would throw light on the issue of the definitive characteristics of Web sites for organizational communication. The multimedia interactive format of the Web should provide organizations with a strategic medium that has capabilities richer than its traditional counterparts
These research questions would contribute toward enhancing general understanding of the role of Web sites as an information source and media channel for organizational communication.
The study sought to make available data on the role of Web sites as a strategic medium for organizational communication by analyzing types of organizational information and Web content characteristics of a sample of Fortune 500 companies. With their vast range of products and services, these companies were chosen as being the most likely group to have used the widest array of technologies in designing Web sites.
Content analysis, a research approach used to study media content, has flourished in a variety of communication contexts since Kassarjian (1977) introduced the method into consumer research. Content analysis can be used at a variety of levels to examine such variables as words, themes, characters, items, and space-and-time measures. Recent content analytic studies of Web sites of Fortune 500 firms have explored financial reporting, Web site design for marketing, and the number of social responsibility items. Kassarjian (1977) and other researchers regard content analysis as a dependable method for providing "ascientific, quantitative, and generalizable description of communications content," p. 10). Content analysis research methods used in this study were adapted from the instructions by Kassarjian (1977), Krippendorf (1980) and Kolbe and Burnett (1991).
The April 26, 1999 issue of Fortune featured "The 1999 Fortune
500 Companies." However, a more updated online version, "The Fortune 500 List,"
was available at <http://www.pathfinder.com/fortune/fortune500/> or <http://www.fortune500.com/>.
The online list was used for three reasons.
In most cases, companies with a Web site had a direct link off the Fortune 500’s "company snapshot" Web page. In cases where a Web site was not listed or the Web address on the Fortune 500 Web site was incorrect or malfunctioning, the home page of the organization was accessed by typing the company's name or initials into the Web browser as part of a typical commercial Web domain (http://www.organization-name.com). If the home page or the company Web site still could not be located, two search engines – Alta Vista <http://www.altavista.com/> and HotBot <http://www.hotbot.com/> – were used to find home page or the official Web site. This sampling procedure draws upon the study by Esrock and Leichty (1998).
The Fortune 500 list rank-orders companies according to revenue in millions. The revenue figures, which included consolidated subsidiaries but excluded excise taxes and other related data, were for the fiscal year ending on or before Jan. 31, 1999. For most companies, all figures were for the year ended Dec. 31, 1998. The sample for analysis was drawn from a stratified systematic sample of 275 companies from the 1999 Fortune 500 List. After a random start every second company on the list was included until a sample of 275 was listed. However, 11 Web sites were dropped because they were inaccessible, unavailable, or malfunctioning, leading to an effective sample of 264 Web sites. A Web site with its collection of Web pages was the basic coding unit because it proved to be the most convenient, efficient, and economical unit under the circumstances of the study. The Web sites were coded between 9 a.m. and 6 p.m. Eastern Daylight Time on five days from Monday through Friday, June 21 to June 25, 1999. The start date was a randomly selected Monday in June.
Twenty-four Web sites (9 percent of n=264) were "check-coded" to evaluate the intercoder agreement on each category analyzed. The number of coders was kept to a minimum – two – in order to attain optimum efficiency in coding. Intercoder reliability coefficients calculated by Perreault and Leigh's (1989) method ranged from .87 to .92 for the study variables, indicating a satisfactory level of agreement between judges on a variety of coded items.
In the absence of content-analytic studies relevant to Fortune 500 Web sites, categories were drawn from previous research relating to analyzing online content, Web site design, and promotional content and the role of computer-mediated communication as a constitutive process in organizing and organizations. Before being included on the coding form, the variables were pre-tested to ensure that they adequately reflected the content of the Web sites. The variables were elaborately defined and explained in a coding book, pertinent excerpts of which are listed in this study. Each site was coded for the presence or absence of the categories defined below.
Types of Organizational Communication in Web Sites of Fortune 500 companies
Web Content Characteristics of Fortune 500 Companies
Audio. Refers to recording, manipulating, or displaying sound files, especially in a format that can be presented on an audio device or on a computer.
Video. Refers to recording, manipulating, or displaying continuous motion of moving images, especially in a format that can be presented on a television or a computer monitor.
Animated content. A Web page reflecting simulation of movement created by displaying a series of pictures, or frames. Note the difference between animation and video. Whereas video takes continuous motion and breaks it up into discrete frames, animation starts with independent pictures and puts them together to form the illusion of continuous motion.
Other Multimedia Features. Any other integrated presentation of text, graphics, video, animation, and sound that is not defined or categorized above.
Other Web Content Characteristics. Any other Web content characteristics not defined or categorized above.
This section provides a discussion of the results of the content analysis. In reporting the results, this section follows the format outlined by Stempel and Westley (1989). The research questions are dealt in sequential order, with a clear statement for each question. The text, interwoven with tables wherever appropriate, reports differences in analysis findings, focusing on those that are statistically significant.
The First Research Question
An analysis of the types of organizational communication in Web sites of Fortune 500 companies (Table 1) indicates that a majority of the sites contained general information (79.9 %). While a majority of Web sites were also being used for promotion and image marketing (67.8 %), fewer Web sites provided product and service information (42 %). Few organizations were using the Web for transaction (15.9 %) or other types of organizational communication (3.8 %).
Types of Organizational Communication in Web Sites (n=264 ) of Fortune 500 Companies
(Note: Web sites could be coded under one or more categories above.)
Results Related to the Second Research Question
Table 2 shows that nearly two-third (64 %) of Web sites studied contained a graphically enhanced interface. Web sites with text-only interface (8 %) comprised a minority, indicating that visual content was emerging as a significant part of Web sites. While nearly half of the Web sites offered basic search (48.1 %), only a very small proportion of them provided intelligent agents (3 %). Approximately, one in eight Web sites provided access for users with disabilities (12.1 %).
Although organizational communication through Web sites can be significantly enhanced by multimedia features, such potentials were under-utilized, as indicated by less than one-fourth using audio (22 %) and video (18.1 %), and less than one in ten Web sites using animated content (9 %) or other multimedia features (6.8 %).
Electronic document retrieval (29.5 %) was one of the primary elements of media richness, while less than one-fifth of the organizations used other media richness elements like updated information (20.1 %), dynamic content (15.9 %), and interactive content and cookies (17.8 %). There were few other Web content characteristics (5.6 %) in the Web sites studied.
Web Content Characteristics in Web Sites (n=264 ) of Fortune 500 Companies
(Note: A significant number of Web sites were coded under one or more categories above.)
The Third Research Question
For the third research question, qualitative analyses of Web sites (n=264) of
Fortune 500 companies indicated that the Web has emerged as a new communication
medium in organizations. However, most Web sites studied were not making full
use of the Web's content characteristics such as interactive content,
easy-to-use graphically-enhanced content, multimedia features, unlimited high
speed access to a global audience, immediacy of updated information, customized
content at relatively low cost, search features, intelligent agents, non-linear
hyperlinks, and electronic document retrieval. The analyses helped identify
eight Web content characteristics.
(1) Effective Promotion with Widespread Reach at Low Cost
For most Fortune 500 companies, general information (79.9 %) was the primary type of organizational communication, followed by promotion and image marketing (67.8 %) and product and service information (42 %). Large organizations view the Web as a new promotional medium with widespread reach at low cost. Apart from disseminating information to anyone with an Internet-linked computer, the Web sites were also being used as a public relations tool. Included were news releases on products and product enhancements; information on strategic relationships and financial earnings; corporate and technical news; and other communication geared to inform the press, customers, prospects, industry analysts, stockholders and others directly or casually interested in the firm. Some organizations also provided links to technical papers, user case studies, industry white papers, and articles dealing with approaches to problems to help people understand their products and services. Some companies offered a choice of various international language versions of their Web site.
(2) Reliable Product Information, and Customer Support Round-the-Clock
With relatively unlimited digital space and capabilites for user-initiated features such as frequently asked questions (FAQs), a significant number of Web sites were used for product and service information (42 %). This strong level of use suggests that large organizations are now using Web sites for providing timely and cost-effective customer service and customer support, so much so that such applications (like FedEx do-it-yourself tracking) can immediately justify the money spent in maintaining a Web site. Several Fortune 500 companies now have well-organized Web sites with electronic document retrieval (29.5 %), updated information (20.1 %), and basic search features (48.1 %) for providing general information (79.9 %), promotion and image marketing (67.8 %), and product and service information (42 %) on the Web. Such Web initiatives have helped obviate overhead expenses like toll-free phone lines and round-the-clock customer representatives and voice-response units. More than 70% of customer queries can be solved with frequently asked questions (FAQs) that are based on common problems. Some companies have set up solve-it-yourself help desks that not only enable most customer questions to be answered without human intervention, but also help to process each query professionally and quickly. If the query is totally new, the customer is asked to phone in or email the question or a detailed description of the problem. The next workday, customer service personnel research the query and send the solution or information to the customer.
(3) Graphically Rich Content with Significant Shift from Text to Visuals
Analyses of the Fortune 500 Web sites clearly suggest that the shift from a text to visual culture as foreseen by McLuhan (1964, 1967) has progressed further. In contrast to a low number of Web pages with text-only interface (8 %), a majority of the sites contained a graphically enhanced interface (64 %) and in some cases content in multimedia formats like video (18.1 %), animated content (9 %), and other multimedia features (6.8 %). The high graphical content signifies what McLuhan foresaw as a dominant category of change: significant transition from a text to a visual culture.
(4) Failure to Project Corporate Identity on the Web
Although most Web Sites were used for promotion and image marketing (67.8 %), they generally had no clear corporate definition or goal with respect to their organizational image. A significant number of Web sites failed to convey a corporate identity or even a consistent design. This failure has two main reasons: (a) many Web sites were set up without a clear objective, and (b) the persistence of a fundamental dichotomy between image marketing and product marketing. Image marketing stresses company reputations, identity, and the relationships between the company and consumers. Product marketing concentrates on promoting and selling the company’s products or services. Brand identity, one of the most important aspects of Web marketing, was woefully lacking in these Web sites.
(5) Little Interactivity, Few Features for Information Exchange, Evaluation and Feedback
Few Web sites had facilities for interactive content and cookies (17.8 %), dynamic content (15.9 %), intelligent agents (3 %), and other strategies for two-way communication with users. Web sites have emerged as an excellent source for seeking consumer inputs on new product ideas, product enhancements, inputs on products and services, marketing research, product evaluation, and customer feedback. In 1996, less than 5% of the Fortune 500 companies conducted transactions over the Internet, according to International Data Corporation in Framingham, MA (Hoffman, 1996).
In 1999, three years after the International Data Corporation findings, the research reported in this paper, also found low figures for transaction (15.9 %). This continued low usage could be due to two reasons: (a), high expenses for additional security software and marketing efforts, and (b) persisting concerns about Internet fraud and security of financial transactions on the Web.
(6) Sparse Use of Multimedia Technology
In their efforts toward reaching the consumer using old or low level technology, few Web sites of Fortune 500 companies offer audio (22 %), video (18.1 %), animated content (9 %), or other multimedia features (6.8 %). Such low use of multimedia formats illustrates how the true potential of the Web's content characteristics has been passed over.
(7) Dearth of Updated Information, Outmoded Interface Confusing to Information Seekers
Although information and interactivity is key to online success, only one-fifth of the Web sites of Fortune 500 companies offer updated information (20.1 %). One reason is that maintaining Web content is very expensive in terms of capital equipment and resources, requiring support much like that of a daily newspaper. The most common type of information presented in real time was the current stock price. The Web being an electronic medium, information can be updated daily, in some cases every few minutes. Despite the graphically enhanced interface (64 %), most Web sites present an obsolete interface that is also confusing to information seekers. According to Sullivan (1996), the interface of a corporate site is often poorly designed because the individuals providing the information have different perspectives than their end users. The key to a successful corporate Web site is a well-thought-out user interface that encompasses a variety of elements, ranging from navigational icons to index pages .
(8) Limited Access for People with Disabilities
Few Web sites of Fortune 500 companies provided special access for users with disabilities (12.1 %). For millions of deaf, hard-of-hearing, blind or visually impaired computer users, the Web's enhanced graphics, audio, and video capabilities are out of reach. Multimedia clips, which are becoming more and more popular on the Web, are, for the most part, inaccessible to blind, visually impaired, deaf and hard-of-hearing users.
As with any study, certain limitations to this research should be recognized when interpreting the study's implications, contributions of the findings, and results. Although the strength of the study is the relatively large sample compared with most studies about Fortune 500 companies, there are several concerns that should guide future research.
This study examined only Web sites of companies in the 1999 Fortune 500 list and the analyses were restricted to organizational information types and elements of media richness in Web sites of the companies. The sampling frame – the companies on the 1999 Fortune 500 list – also limits the study in that results may not be generalizable to organizations outside of this population. For example, it would be interesting to analyze elements of media richness in Web sites of smaller organizations. Further, the descriptive findings are likely to be time-bound, because organizational use of the Web continues to evolve.
This study examined only companies in the 1999 Fortune 500 list, which represents large companies in the United States. It may be worthwhile to compare the results of this study with Web content characteristics of large organizations based in other countries.
The findings generated lead to a number of conclusions that have important implications. First, the Web has emerged as a new communication medium in organizations. Nevertheless, most Web sites studied were not making full use of the Web's content characteristics such as interactive features, easy-to-use graphically-enhanced content, multimedia applications, unlimited high speed access to a global audience, immediacy of updated information, customized content at relatively low cost, search features, intelligent agents, non-linear hyperlinks, and electronic document retrieval.
As a new medium for organizational communication, the Web offers a wide variety of organizational information, the study concluded. While a majority of the Fortune 500 company Web sites studied provided general information (79.9 %), followed by promotion and image marketing (67.8 %), fewer Web sites offered product and service information (42 %). Only 15.9% of the organizations were using the Web for transaction, and 3.8 % were using it for other types of organizational communication.
This study identified eight Web content characteristics of Fortune 500 companies.
Effective Use. (a) Effective promotion with widespread reach at low cost (b) Reliable product information and customer support round-the-clock. (c) Graphically rich content with significant shift from text to visuals.
Ineffective Use. (d) Failure to project corporate identity on the Web. (e) Little interactivity, few features for information exchange, evaluation and feedback. (f) Sparse use of multimedia technology. (g) Dearth of updated information, an outmoded Web interface confusing to information seekers. (h) Limited access for people with disabilities.
The author wishes to thank Kellam Eanes, Harlen E. Makemson and Jay Aikat for their assistance with this project. Thanks to the American Society of Newspaper Editors Institute of Journalism Excellence, the James L. Knight Foundation, the Poynter Institute and the University of North Carolina at Chapel Hill for funding and research support. Thanks also to Professor Tom Dixon and two anonymous reviewers for their critiques that helped focus the study.
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