Ron Burt: Network Volatility and Advantage
University of Greenwich, London
Friday 23rd September 2011: 1-3pm
Advantage lies in both the structure and the volatility of a network. Whatever the advantage provided by a network, changes from the previous to the subsequent network have implications for performance.
We distinguish four dimensions to network volatility (churn, variation, trend, and reversals), measure them with four years of network data on a population of investment bankers, then add them to analysis predicting banker compensation from levels of advantage measured by a banker’s network status and access to structural holes. Much of the link between network advantage and performance depends on a network being unstable in certain ways.
We identify two stability traps that have significant negative effects on compensation, but the key is not to avoid the traps so much as to avoid them in a particular way. The network variation associated with compensation is reversal: a prodigal-son pattern in which network advantage is lost then regained, or gained then lost. Bankers who go through network reversals enjoy significantly higher returns to their level of network advantage. In fact, the strong aggregate association between compensation and network advantage does not exist for those bankers who failed to experience a reversal during the four years.
Our results could be peculiar to dynamic kinds of work (such as the investment banking analysed here) but within that unknown scope condition, one thing is clear: network volatility affects the advantage otherwise associated with network status and access to structural holes.
Presenter: Professor Ron Burt is the Hobart W. Williams Professor of Sociology and Strategy at the University of Chicago Booth, Business School. He has made world-leading contributions to the study of social networks, particularly the ways that social networks create competitive advantage in careers, organisations, and markets.
When: Friday 23 September 2011, 1 to 3pm
Where: King William Building, University of Greenwich, Old Royal Naval College, Park Row, London SE10 9LS
Visit the seminar website for further information about the programme, venue, and how to register.
We look forward to welcoming you at the seminar.
Kind Regards
On behalf of Dr Bruce Cronin
Centre for Business Network Analysis
+44 (0)208 331 9083
Comments