Large projects suffering management problems different from small ones because of the organization's issues. The administrative level is too far away to understand what's going on in the organization, so there is a lack of communication between those who make decisions and those who are affected by them.
Lack of communication is due to a gap in understanding, which is induced by the fact that people are not the same. This diversity results from the differences between individuals and causes major problems when it comes to managing any organization. People can't understand how things work on the lower level because they don't use their imaginations enough; instead, they rely too much on words.
This lack of understanding leads to a desire for control, which is the opposite of the anarchy that would occur if everyone worked in their own way. This situation arises because individuals have different agendas and interests; therefore they cannot be trusted not to work against each other.
Here's the thing: I'm going to assume that by "communication," you mean verbal communication, as written and non-verbal forms of it do not usually lead to misunderstandings. Verbal communication is an incredibly important part of human society; in fact, humans use a large portion of their brain just for speech production and recognition. It also helps keep track of information. So we can't remember everything at once, so we assign meanings to words or symbols which represent concepts such as objects in our environment or abstract ideas like events or actions.
When it comes to misunderstandings, they occur for several reasons. The most common is the difference between literal and metaphorical language; the second most common is a lack of context in which an action occurs or a statement was made.
Literal language is the most common form of communication, and while it's useful for conveying factual information, it can be misleading. If you say "The sky is blue," that statement has meaning in terms of literal facts it reflects reality; but if I said to someone "You're an angel" or "That was a close one," we know those sentences are not meant literally.
Context is extremely important to communication because it provides the information necessary to understand a statement. If I said "It's raining" while I was standing outside in the rain with wet hair and clothes, then that sentence has meaning as an observation of reality; but if a friend said it when they were sitting on their couch watching television, we would know something is amiss.
What's interesting is that a lot of the time, humans are themselves responsible for their own misunderstandings. We can't remember everything so we make assumptions based on what information we have -- but since we don't know if those assumptions are correct until they're confirmed, it gives us almost no way to verify whether our guesses were accurate.