“network density” and “structural equivalence” New approach to Platform Strategy Vol.2

Vol 2
This time, let’s talk about “network density” and “structural equivalence”.

Granovetter’s research on “strength of weak ties” was simply that “acquaintances who are not always so closely connected” provide far more useful information. Bert further developed Granovetter’s concept of “weak ties”, “organizations dominated by some groups of humans perform poorly” and “structures for businesses to maintain a competitive advantage.” The space between the two is important. ” “Gap” means “gap”. And the index that measures how closely people are related to each other in a certain network is called “network density”.

A dense network means a network that is connected only to people who like it or who have similar ideas. It can be said that the voids are small because of its high density.

When you use SNS etc., you may realize that it is easier to connect with people who have the same way of thinking as you. In a normal network, you tend to connect only with people you like or have the same idea, so if you leave it to yourself, it will inevitably become dense and homogeneous.

However, within such a “strong tie” network, the ability to collect information from the outside weakens due to weak connections with people who have different opinions from ourselves. Not only that, but when you’re in such a high-density network, information is shared instantly, making it difficult for you to act or speak freely, even if you have different opinions.

In other words, in a high-density network, there are no free-moving gaps, or “gaps.” A typical example is that in a so-called village-bonded society, if you say something different from everyone else, it will be “Murahachibu” or be neglected in the society.

With that in mind, assuming that the “cost of maintaining a network” is basically the same for everyone, a network with a low network density, that is, a “large void”, will provide various information at the same cost. Bert argued that it would be obtained. He argued that a person with a network with a lot of voids would have an advantage in terms of position, and in terms of action and negotiation, he would have an advantage due to his high degree of freedom.

Characteristics of people who are promoted quickly

Then how should we act as an individual?

Bert derived the theory that “managers who include many distant people in their personal networks are promoted faster” from a survey of managers of a major American information equipment manufacturer. In other words, a person who is highly regarded in the company and has a fast career is valuing the relationship with people who do not have much contact with him or her on a daily basis.

Furthermore, people who live on social boundaries are more likely to live using entrepreneurial wit than people who are in a socially homogeneous environment. Here, the social boundary is the place where two social areas meet, where one kind of person meets another kind of person.

For example, more information is available for managers who are away from the center, such as overseas, local areas, and subsidiaries, because they can experience negotiations with various people, rather than managers who are in the headquarters such as the planning department of the head office. You will be able to collect it. In recent years, the fact that the top management of a subsidiary suddenly becomes the top management of a large parent company is a testament to the importance of having various personal connections in a turbulent business environment.

Especially in the present age when the conventional business methodologies are changing due to new technologies such as the Internet, AI (artificial intelligence), IoT (Internet of Things), blockchain, etc. However, I think that human resources with abundant experience in “other-style games” will be required.

In other words, human resources who have various experiences (including job changes) as individuals tend to advance faster, and companies should hire human resources with as diverse backgrounds and personal connections as possible, regardless of whether they are new graduates or mid-career hires. This means that you can get new resources.

Escape from the “structural equivalence” position
Bert further argued that “structural equivalence” positions, that is, occupying exactly the same position (position) as other people, are likely to be involved in a competitive relationship.

“Structural equivalence” means that the structure of the network network does not change even if one person in the network is replaced with another person. In other words, in the case of a company, “structural equivalence” can be said to be a substitute for others at any time. Therefore, as an individual strategy, you should escape from these positions as much as possible.

Bert decided that the amount of voids people have inside the network depends on how closely they are structurally equivalent to others and how densely and cohesively the other people with whom they are involved are.

For example, suppose you have 10 acquaintances in your company. And suppose that only 10 of them knew each other, and all 10 knew each other. In that case, you and the remaining 9 people are in a “structural equivalence” relationship, and even if you leave the company, the network of 9 people will not change at all (only you are not). When they are tightly bound, they quickly become “structurally equivalent” to others. That is “there is no void”.

There, even if you change jobs to another company, if you consider the relationships you have built in your original workplace to be important to you and keep those relationships in good condition, then in your new workplace you will be other than you. There is a good chance that your relationships will not overlap with your relationships. As a result, you can be in a position where structural equivalence is unlikely to occur in a new company.

There is a japanese saying, “Do not muddy the standing bird traces,” but in a long life, there is always the possibility of having a relationship with the organization to which you belonged, the people who were there, or your acquaintances when you were a student. In that sense as well, it can be said that it is important in network theory to value the connection with all the people we have met in the past.

If you have not yet read Vol1 you can read it from below.

Network theory：The strength of weak ties　＆ Structural holes 　New approach to Platform Strategy　vol.1  ↓↓

https://www.carlbusinessschool.com/blog/structual-hole/