Social Network Analysis - Invisible Barriers; Innovation; Structural Holes

This coming week I am working on a project I have been looking forward to for some time. It’s a social network analysis in the R&D department of one of the world’s most exciting and successful biotech companies.

One particular challenge of the survey is that it covers employees on 3 continents: Europe, Asia (Japan) and North America (USA).

The analysis can hopefully answer a number of questions of high importance. Some of them are:

1) What are the barriers to effective cooperation and knowledge sharing?

What are the magnitudes of these barriers? Are there some that management are not aware of? Are there any obvious solutions to overcome them?

From the literature, practical experience and logical conjecture we know that lots of barriers to effective knowledge sharing, in and between organisations, can exist.

These barriers can be

physical (e.g. individuals who do not get to meet can not really share knowledge effectively),

cultural (e.g. in organisations where there is a culture that does not encourage “useless chat”; which fosters trust and connections; which lowers the cost of knowledge search and knowledge transactions),

motivational (e.g. in cultures where individual rather than collective achievement is rewarded),

sociological (e.g. because we as humans tend to form social relations with those who appear to be like ourselves),

historical (e.g. in merged organisations that have not been well integrated)

or of a totally different kind (or a complex combination).


2) To what extent does the social structure facilitate or impede the generation of new ideas?

The topic of how social structure can facilitate or impede the generation of new ideas is one of my favourite topics.

I urge anyone with an interest in the topic to read Ronald Burt’s seminal book about his research into the topic, Structural Holes: Social Structure of Competition.

Basically, Burt’s research documents that valuable ideas usually do not appear in someone’s head (accompanied by a visible lightning in the back of the scene) out of nowhere or because they are “creative”.

Instead, valuable ideas are, more often than not, the result of an import/export game where mundane ideas (or knowledge) from several different areas are combined to form a great (read: valuable) idea.

People who occupy certain positions in an organisations social structure are more prone to getting valuable ideas than others. They are usually people whose social connections span what Burt term a “structural hole”. Structural holes exist where there are few or no social connections between pools of knowledge.

Social network analysis can not only seek out those individuals who are most prone to have valuable ideas, but more importantly identify where such structural holes exists with no one to cover them. These structural holes are likely to contain more valuable ideas; ideas that organisations should harvest for a number of good reasons.

There is certainly both anecdotal evidence and logical conjecture to suggest that ideas found in such structural holes, on average, are quicker and cheaper to take to market. One such example is documented in the March 2005 issue of Harvard Business Review, in an article entitled “A Practical Guide to Social Networks”.

The article starts by referring an instance where members of different divisions in United Technologies Corporation where brought together for a day of brainstorming. In the article members of the organisation refer to this kind of expertise sharing as “an unnatural act”.

In fact what they were doing was that they were closing a structural hole. The article describes the result of the “unnatural act”: A new product, PureCycle, which “contained virtually no major new components, but offered a breakthrough value proposition.”


This became a bit of a lengthy post, but I am sure you understand why I am exciting about this upcoming project.