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The Other Office Chart

Posted by: Jena McGregor on July 31, 2007

Raise your hand if these statistics sound like the place you work. According to a new study by Katzenbach Partners released today, 65% of workers rely on one another, not management, to solve problems. 37% ignore company rules because they’ve figured out a better way to get things done. And people are more likely to turn to their co-workers (52%) than their boss (45%) when they need to accomplish things at work.

Katzenbach is releasing this study in an effort to highlight the “informal organization—the way work gets done outside formal organizational charts and processes,” says Katzenbach principal Zia Khan. Increasingly, companies are turning to social network analysis—a process by which they create visual maps of the web of social networks in an organization to see who has significant influence or offers extra help—to better understand the lesser known org chart.

I first met Khan back in January of 2006, when I was reporting a story I did last February on the value of the informal organization. In that story, I wrote about defense contractor Raytheon’s efforts to map its informal networks, a professor at the University of Virginia who has started a roundtable on the topic, and the companies he counts as members, which includes Procter & Gamble, Merck and Lehman Brothers. (A Fortune article covered the same topic recently.) I also wrote about informal networks last August, when I profiled how the University of Maryland soccer team was using social network analysis to better identify team leaders.

Since then, I hear about the value of social networks more and more often. Recently, I was talking to a consultant on the future workplace who uses input from peers to help determine her employees’ annual bonuses. We discussed how frequently people’s every-day workplace contributions—the ways they help their colleagues, solve problems for peers, and hand off resources—aren’t seen by managers, and therefore, often aren’t accounted for in how they’re paid. That made me think: What if the most connected people in an organization’s informal network—the people who spend a lot of their time helping others, even if their managers aren’t aware of it—were paid more? Is there a way social network analysis could influence employee bonuses?

Reader Comments

john A. Byrne

August 2, 2007 9:44 PM

As someone who once worked in the trenches and did lots of mentoring of colleagues, I can confirm what Katzenbach Partners found in this study. And I'll make one more observation about their findings: I would bet that you would find this level of social networking in organizations that are healthy and in organizations that are dysfunctional. Why? Because in fear-based environments, people have even more reason to bond together and help each othe. In healthy organizations, it's obvious that people would feel generous. I'll make one more point: managers today are so frenetic and slammed that it's hard to work the troops. Span of control has increased. There are fewer layers. And there's generally more delegation--all contributing to the phenomena found by this study.

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