by

Dr. Ian O. Williamson

Goals of Session

• Understanding your bases of power

• Understanding the attributes of an effective network

The Importance of Power

Power:

– The capacity of one party to influence another party

Sources of Power

Reward valued resources

Coercive punishment

Legitimate authority or right

Referent admiration

Expert skills & knowledge

Ecological control environment

Information access to info.

Social Capital and Power

• Social Capital:

– Productive possibilities embedded within network

relationships

• “While human capital refers to individual ability,

social capital refers to opportunity” (Burt, 1997, p. 339)

Networks

• Definition:

– Set of relationships critical to one’s ability to accomplish a goal.

• Different Types

– Task-oriented networks

– Career development networks

– Social or friendship networks

Structural Network Attributes and

Positions

• Range

• Density

• Central Connector

• Peripheral Actor

• Broker

Structural Network Attributes

and Positions

• Range – Total number of people you listed

– Diversity of network members

– Networks high in range can be a source of: • Information Power

• Networks high in range can be sources of innovation because they represent opportunities to combine complementary expertise

Example of Apple

• “Network Innovation”

• Cultivate contacts with external parties

• Avoid the "not invented here"

syndrome

• For example, idea for iPod was

originally dreamt up by an external

consultant

BHP Billiton

• Project

– Aluminium smelter in Mozambique

• Business Challenge

– Malaria

Pull out or fight?

• Innovation

– Cross-sector partnership with the governments of Mozambique, South

Africa and Swaziland and several international not-for-profit

organizations

– Creation of an anti-malaria headquarters

– The project spaned three countries, covering 200,000 sq km and 4m

people

Example of Etihad

• Business Goals

– Increase customer satisfaction and sales

– Attract and retain call centre employees

• Social and Business Challenge

– Lack of Emiratis in the private sector workplace

– Low representation of women in the workforce (“closed families”)

• Innovation

– Creation of an all Emirati women call centre in Al Ain, U.A.E.

– Partnered with Abu Dhabi Tawteen Council and the

Abu Dhabi University in Al Ain

Etihad opens Al Ain call

centre staffed by

Emirati women

“An Emirati customer

service staff will boost

sales and satisfaction”,

said Hareb al Muhairy, the

vice president of sales for

the UAE at Etihad.

"When an Emirati national

picks up the phone, he or

she knows the needs of

the market. If the caller

asks, 'Where shall I go - to

Turkey or Lebanon?' an

Emirati will be able to

guide him better since

they share the same

cultural interests.”

Developing High Range Networks

• Provide opportunities to scan external organizations

• Provide opportunities to attend external functions

(e.g., conferences, training, sabbatical in other

organizations)

• Train on effective use of social media

• Recognize and reward scouting behaviors

Whelan, E., Salvatore, P., De Valk, J. & Aalbers, R., 2011. Creating Employee Networks that Deliver Open Innovation,

MIT Sloan Management Review, 53, 37-44

Density

• Density:

– Extent to which people within one’s network know each other

• High Density is characterized by:

– Information exchange

– Sharing of group norms

– High levels of trust

– Reciprocation

• High density networks can be a source of:

– Referent Power

– Information Power

• High density networks produce:

– High levels of employee commitment

– High productivity

– High quality

Bob

Frank

Oliver

Jennifer

Ted

PhillipGeorge

Steve

Bob

Frank

Oliver

Jennifer

Ted

PhillipGeorge

Steve

Initial Network Ties Network Ties after Intervention

Density

Example of Apple

• Parallel design

• Interdisciplinary design reviews

• Instead of bemoaning meetings, mangers are

proud of the number of meetings they have

• "When the challenges are that complex, you

have to develop a product in a more

collaborative, integrated way.”

Bob

Frank

Oliver

Jennifer

Ted

Phillip George

Steve

Central Connector

Central Connector

• Attributes of Central Connector – Superior access to internal team information

– Strong influence in team decision making

– Perceived positively by group

– Tend to be a role model for group norms

– Facilitate task coordination

• Central Connectors tend to have high: – Information Power

– Referent Power

• Developing Central Connectors – Encourage job rotations within a unit

– Encourage involvement on cross-functional projects

Bob

Frank

Oliver

Jennifer

Ted

Phillip George

Steve

Peripheral Actor

Peripheral Actor

• Attributes

– Social Isolate

– May be geographically distant, new member or outside expert

• Peripheral Actors typically have low levels of:

– Information Power

– Referent Power

Bob

Frank

Oliver

Jennifer

Mark

Ted

Phillip George

Steve Betty

Angela

Pat

Kristin William

Fred

Broker

Broker

• Attributes

– Superior access to external information

– Excellent in an integrator role or serving as ambassador for the

group

• Brokers tend to have high levels of:

– Information Power

Value of Brokers:

Law Firm Example

• Research Question: – How does employee mobility between competitors and

cooperators influence firm performance?

• Theoretical Prediction: – Mobility may create brokers that carry inter-organizational

social capital between cooperators that stimulates economic activity

• Setting: – Movement of lawyers between law firms and Fortune 500

firms over a 5 year period

Somaya, D., Williamson, I.O., & Lorinkova, N. (2008). Gone but not lost: The different performance

impacts of employee mobility between cooperators versus competitors. Academy of Management

Journal.

Employee Mobility and Client Development

Loss of

Attorney to

Rival Law

Firms

Loss of

Attorney to

Potential

Clients

Reduction in

Business from

Existing Clients

Increase in

Business from

Potential Clients

Hiring of

Attorney from

Potential

Clients

Increase in

Business from

Potential Clients

Hiring of

Attorney from

Rival Law Firm

Increase in

Business from

Rivals’ Clients

The movement of an patent attorney from a focal law firm to a

potential client increases the odds of that law firm getting new

business from the company by 40.5%

Strong Ties vs. Weak Ties

• Strong Ties

– High-trust relationships (e.g., mentor)

– Typically reciprocal relationships

– Characterized by high reliability

• Weak Ties

– Transactional relationships

– Useful for acquiring new information

Adapted from: Cross et al., 2005) “A

practical guide to social networks.”

Harvard Business Review 83(3).

Network Structure and Innovation

Ideal for solving

ambiguous

problems that

need innovative

solutions

Ideal for complex

problems where

components of

problems are

known but

sequence of the

solution is not.

Ideal for solving

familiar problems

with known

responses

Strategies for Building Effective

Networks

• Analyze your developmental goals and needs

• Assess the gaps in your networks

– Which groups are over- or under-represented?

– Upon who are your over-reliant?

– What relationships do you need to strengthen?

• Formulate strategies for enhancing your network

Strategies for Building Effective

Networks

• Be proactive

• Broaden your view of whom you can learn and benefit

from

• Understand the value you add to the network

• Take a long-term view

• Don’t be overly dependent on one network tie

• Don’t under estimate the value of trust and credibility