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Managers are often reluctant to move projects online.  The usual reasons cited are convenience, ease-of-use, or most of all, security (a classic shibboleth).  But the real reason many are reluctant is the desire to control the distribution of information.

By controlling the distribution of information, managers can hold on to decision-making power.  Any dissent can be dismissed with a simple, "You're not up to speed on the overall situation."

And that's precisely why all projects should be online projects.

 Persistence

Online projects make information persistent, both throughout the course of the project and afterwards.  Think of all the times when you've asked, "What did we decide?" or "Who was supposed to call her?"  Managing projects online allows managers and team members alike to find the relevant meeting notes, discussions, documents, and deliverables.  Not only does this save time during project execution, it also serves as a useful archive of past work.

Contrast this to the ephemeral nature of most projects, where at best, information is locked away in individual inboxes and hard drives, and at worst, is simply in people's heads.

Transparency

Online projects make information transparent to the team, but in a manageable way.  It's hard to predict all the ways that the different elements of a project should be connected.  One way to maintain transparency is to simply email "All" with every bit or news or every document revision.  The problem is, this kind of "transparency" simply results in people ignoring the updates.  A better way is to store all the information in one place so that people can seek out and interact with the content and files they need.  Online projects can also promote serendipity by providing a Facebook-like "Activity Stream."

Contrast this to the secretive nature of most projects, which result in a constant barrage of update requests flowing to and from the project manager.

Sharing

Online projects make sharing both easier and more manageable.  By collecting all the relevant information, files, and documents in a single place, it's easier to find the item or items you want to share.  By understanding who is a member of the project team, it's easier to pick the people with whom you want to share.  And by directing the sharees to the online project, it's easier to keep information up to date.

Contrast this to the limits of email sharing, where you have to find and select the file from somewhere on your hard drive, enter the email address of the sharee, and end up with multiple out-of-date copies of each document on different people's hard drives.

Accountability

Online projects drive greater accountability by keeping score.  When all the tasks and deadlines are visible to the entire team, social pressures encourage users to meet their deadlines, so they're not letting the team down in front of everyone.  And if they simply push back their deadlines, recording that fact also introduces social pressure.

In contrast, when tasks are assigned by one-on-one emails and hallway conversations, the only people who are aware of them are the manager and the assignee.  Social pressure may seem like a squishy factor, but there's a reason why public commitments for things like smoking and weight loss are more effective than private ones.  Humans are social animals, not purely rational actors.

Conclusion

It's true that starting an online project takes more time than simply leaving everything up to tacit understandings, but persistence, transparency, sharing, and accountability make online projects a far superior option for managing and completing projects, and these benefits far outweigh any minor difference in up-front effort.