It's indeed a very handy tool for the managment to make use of this informal network to assess the impact of any unpalatable decision to be taken by it!
Grapevine is slightly different from gossip, gossip is something that is done with the intent to share personal information about others - harmful, embarrassing or otherwise whereas grapevine is mainly bits of infos that are official, relevant and usually true, but through channels that are not directly linked to each other. Management mainly uses this to keep a heads up on the competition scenario and to gauge the overall feelings and mood of the employees!
Grapevine channels carry information rapidly. As soon as an employee gets to know some confidential information, he becomes inquisitive and passes the details then to his closest friend who in turn passes it to other. Thus, it spreads hastily.