Informal networks & Decision-Making

This week’s readings showed how fundamentally important informal networks are to the day-to-day operations of most organizations. One article went so far as to claim that informal networks (rather than the formal boundaries outlined in an organization’s structural chart) are where the “real work” takes place (Krackhardt & Hanson, 1993, p. 104).  Because these informal networks have such a great impact on operations, conducting a detailed analysis of them can provide valuable insights for organizational leaders (Krackhardt & Hanson, 1993; Cross, Borgatti & Parker, 2002; Hanneman & Riddle, 2005).

Similarly, an article titled “How ‘Who You Know’ Affects What you Decide” proposes that network analysis can provide useful information when it comes to untangling the process of organizational decision-making (Cross, Thomas & Light, 2009). The authors of this article suggest that previous research has failed to fully account for the “role networks play, both within a team and throughout an organization, in the way decisions are framed and how they are carried out (Cross, Thomas & Light, 2009, p. 36). However, articles from our assigned readings do mention how network analysis can be useful to organizational leaders by helping them to, among other things, “consider how to reallocate information domains or decision-making rights” to improve efficiency (Cross, Borgatti, & Parker, 2002).

Therefore, the difference between our assigned readings and this article seems to lie in that fact that the article by Cross, Thomas and Light tunnels its focus entirely on informal networks and organizational decision-making processes to the exclusion of all other considerations (Cross, Thomas & Light, 2009).  In addition, they link network analysis to “process mapping” in an effort to provide further practical guidelines for organizational leaders (Cross, Thomas & Light, 2009). Ultimately, their in-depth look is warranted, they argue, because of the amount of time and money that can be wasted when decisions are made inefficiently (Cross, Thomas & Light, 2009). They carried out their study of informal networks by closely inspecting how decisions were framed and executed and two different organizations (Cross, Thomas & Light, 2009).

Interestingly, they found that both organizations had similar problems, “in both cases the decision-making process was hampered not by failures to get the right people involved but by too much collaboration” (Cross, Thomas & Light, 2009, p. 36). Collaboration can be an effective tool for organizations but, as Krackhardt & Hanson point out, it isn’t necessarily the quantity of communication being shared that proves impactful for organizations; instead, it’s the quality of information (1993).

The network analysis conducted by Cross, Thomson and Light revealed that the high levels of collaboration were due to poorly defined roles and a lack of understanding about who had ultimate authority to make decisions within the organizations (Cross, Thomas & Light, 2009). As a result, members of the organization sought out high rates of consensus from others in their network and afterward often ended up moving decisions up to higher hierarchical chain (Cross, Thomas & Light, 2009). This led to months of inactivity as the organizations leaders became overloaded (Cross, Thomas & Light, 2009). Understanding this aspect of the organization’s decision-making process will hopefully provide the organizational leaders with plans for “more targeted and ultimately more successful interventions” as suggested Cross, Borgatti and Parker (2002).

All of the reading that I encountered this week seem to concur that informal network analysis can be an invaluable tool in providing insight into the process that occur within organizations. Organizational leaders can then put this insight to practical use throughout their organizations to increase the efficiency and effectiveness of communication practices. Whether it’s finding ways to increase collaboration by pulling in network members who are on the periphery or, in the case of some organizations, figuring out how perfectly good concepts “get lost, sidetracked or even reserved en route from approval to execution” (Cross, Thomas & Light, 2009, p. 35). 

References

Cross, R., Borgatti, S., and Parker, A. (2002). Making invisible work visible: Using social network analysis to support strategic collaboration. California Management Review, 44, 2, 25-46.

Cross, R., Thomas, R. J., & Light, D. A. (2009). How who you know affects what you decide. MIT Sloan Management Review, 50, 2, 35-42. Retrieved from http://search.proquest.com/docview/224966844?accountid=14749

Hanneman, R., and Riddle, M. (2005). Introduction to social network methods. Riverside, CA: University of California, Riverside.

Krackhardt, D, and Hanson, J. (1993). Informal networks: The company behind the chart. Harvard Business Review, 104-111.