Web Ppt 2009 Networks Carpenter M

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My PP deck for a session I run on social networks and entrepreneurship for the Wisconsin Entrepreneurship Bootcamp (WEB).

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Web Ppt 2009 Networks Carpenter M

  1. 1. Social Networks & Social Capital WEB Presentation Mason A. Carpenter Mason A. Carpenter
  2. 2. Networking Like Obama? Gogo Erekosima, Innovate Africa Project Mason A. Carpenter
  3. 3. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  4. 4. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  5. 5. Definitions • A social network is a social structure made of nodes (which are generally individuals or organizations) that that are connected together by ties. • Social capital is the resources—such as ideas, information, money, and trust—that you are able to access through your social network. Mason A. Carpenter
  6. 6. Definitions • A broker is someone who connects (bridges) different subgroups in a network; subgroups can be functions, departments, divisions, locations, and any other dividing characteristic (age, gender, and tenure for instance) • A connector is someone whom others consult frequently for information, resources, expertise, or decision-making help in the network. • A super connector is someone who makes a disproportionate number of connections, or provides a bridge between otherwise unconnected, large networks. Mason A. Carpenter
  7. 7. Definitions • Comrade – Trusted member of your professional network that is closest to you and who can speak honestly about your goals. This circle of individuals is usually around 7. • Colleague – Member of your inner ring of up to 150 people. • Contact – Your entire network (essentially the phone book!) www.upmo.com Mason A. Carpenter
  8. 8. Brokers Connectors or super connectors Direction of resource flow Mason A. Carpenter
  9. 9. The org chart… Ego & Whole Networks Networks…how work actually gets done Mason A. Carpenter
  10. 10. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  11. 11. Our Predispositions • Networks aren’t manageable • = Networking • A time sink • Risky • External (like Facebook) • “Informal” Mason A. Carpenter
  12. 12. Rare? “If everyone had super powers, there would be no super heroes.” Syndrome from Disney’s The Incredibles Mason A. Carpenter
  13. 13. Rare? • Nationally, more American’s are bowling than ever before, but individual play has largely supplanted team play (Putnam, 2000) • From 1985-2004, the percentage of individuals in businesses who identified a co-worker as a close confidant in their discussion networks declined from 48% to 30% (Kacperczyk, Sanchez-Burks, & Baker, U Michigan working paper 2009) Mason A. Carpenter
  14. 14. Who you know, or what you know? • Wh o y o u k n o w, d e t e r m Mason A. Carpenter
  15. 15. Pipes vs. Ties Mason A. Carpenter
  16. 16. Context - Summary • Our biases and predispositions • Social networks are becoming diffuse • Who you know  What you know • Pipes and ties Mason A. Carpenter
  17. 17. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  18. 18. Research • Psychology & Sociology • Management & Strategy • Finance • Cross Cultural Mason A. Carpenter
  19. 19. Psychology & Sociology • Milgram’s “Small Worlds” (PT 1967) • Granovetter’s “Getting a Job” (1974) • In a large electronics company, managerial compensation, positive performance evaluations, promotions, and good ideas are disproportionally in the hands of people whose social networks span structural holes (Burt, AJS 2004) • Among managers, bankers, and analysts, social capital resources are dramatically concentrated in the immediate network around a person (Burt, AMJ 2007) Mason A. Carpenter
  20. 20. Management & Strategy • Nature of network ties affects how well board directors perceive their ability to contribute to and monitor firm strategy (Carpenter & Westphal, AMJ 2001) • CEO paid more and more strongly linked to firm performance when other social network characteristics were present (Carpenter, Sanders & Gregersen, AMJ 2001) • Non-exec managers paid more when background plugged a strategic network need (Carpenter & Wade, AMJ 2002) Mason A. Carpenter
  21. 21. Management & Strategy • Search-transfer paradox. Weak ties promote knowledge of opportunities (information search), but strong ties are needed to access and transfer the actual knowledge and related technology (the transfer issue) (Hansen, ASQ 1999) • Super connectors in science – a disproportionate number of inventions are spawned by a select few scientists; this phenomenon is growing stronger, and such scientists are increasingly mobile across organizations and industries (and despite non- compete clauses) (Flemming & Marx, SMR 2006) Mason A. Carpenter
  22. 22. Finance • Geographically proximate stock analysts are more accurate than other analysts (Malloy, JoF 2005) • Mutual fund portfolio managers place bigger bets and yield greater returns from firms they have social network ties to (Cohen, Frazzini, & Malloy, JPE 2008) • Analysts outperform on their stock recommendations when they have social network ties to a focal firm (Cohen, Frazzini, & Malloy, HBS working paper 2008) Mason A. Carpenter
  23. 23. National culture • National culture and social networking – Not extensive research on differences – Nationality does not appear to excessively constrain entrepreneurs – Hofstede’s cultural dimensions of power distance, individualism/collectivism, and masculinity are relevant – http://www.geert-hofstede.com/ G. Hofstede and R. R. McCrae Personality and Culture Revisited: Linking Traits and Dimensions of Culture Cross- Cultural Research, February 1, 2004; 38(1): 52 - 88. Mason A. Carpenter
  24. 24. National culture • Individualistic and non-hierarchical societies are more inventive than other societies (global patent data) (Shane, JBV, 1992). • Knowing someone who has started a business recently, across the world, has a significant impact on entrepreneurship participation. This relationship is strongest in low power distance, masculine national cultures (comparing 35 countries, 5 years) (Klyver, Hindle, & Schøtt, SSRN, 2007). Mason A. Carpenter
  25. 25. Overarching Conclusion • Social networks and social capital are key inputs into value creation and entrepreneurship • Weak ties most valuable to access and disseminate knowledge (information search) • Strong ties most valuable to transfer knowledge and access resources (information/resource transfer) • National culture can play a role Mason A. Carpenter
  26. 26. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  27. 27. Data and methods….. Generic Characteristics DENSITY SIZE TOTAL EMBA Spring 08 Variable Obs Median Mean Std. Dev. Min Max # of links 30 16 16 6 7 24 Very Close % 30 30% 34% 15% 14% 70% Network Density % 30 45% 45% 16% 20% 86% Senior % 30 46% 46% 21% 4% 93% Peer% 30 24% 28% 14% 7% 63% Junior % 30 20% 23% 17% 0% 60% Different Area% 30 40% 46% 26% 0% 94% Different Unit % 30 30% 33% 21% 0% 88% Different Firm% 30 46% 40% 21% 0% 76% Same Gender % 30 69% 63% 22% 14% 100% Same Race % 30 93% 85% 28% 0% 100% Same Nationality % 30 100% 90% 26% 0% 100% Other Characteristics? Weak v.s. Strong _______ ________ Connectors Centrality _______ Mason A. Carpenter
  28. 28. Outline • Some definitions • Context • Research • Assess • Going forward Mason A. Carpenter
  29. 29. Going Forward • Reasonable to seek a balance between working and networking • Assess your social network IQ – Does the word network make you queasy? – Take a 20-item survey (see Appendix) – UpMo Job Readyness Evaluator (www.upmo.com) • Assess your own network – Gladwell’s list of names (see Appendix) – Grid (link to survey in Appendix) – Personal, operational, strategic • Assess your group’s network and networking – Requires different skill sets to excel – Bridging and brokerage skills – Different mindset – Different reward structure • Give, give, give "Worry not that no one knows you, seek to be worth knowing.“ Confucius Mason A. Carpenter
  30. 30. Further Reading • Wayne Baker (2000). Achieving Success Through Social Capital. Jossey-Bass. • Ron Burt (1992). Structural Holes. HBS. • Ron Burt (2009 – in press). Neighbor Networks. Oxford. • Mason Carpenter (2009). An Executive’s Primer on the Strategy of Social Networks. BEP. • Daniel Goleman (2006). Social Intelligence. Bantam. • Martin Kilduff & Wenpen Tsai (2004). Social Networks and Organizations. Sage. Thank you! Mason A. Carpenter
  31. 31. Appendix The following page has a 20-item survey on your attitude toward networks. Simply score yourself on a scale of 1 (disagree), 3 (ambivalent), or 5 (strongly agree), and sum your scores. A grid-based Ego network survey is available under “My Bookshelf” heading” http://research3.bus.wisc.edu/course/view.php?id=139 Mason A. Carpenter
  32. 32. Appendix Mason A. Carpenter
  33. 33. From Malcolm Gladwell’s Tipping Point (pp. 39-40). Go through this random list of names and give yourself 1 point for everyone you know with a given last name. For instance, if you know three Johnsons, you get three points. What is your total? Out of 400 people, Gladwell found 5% scored below 20, 3% over 90, 1% over 100, and a range of 16-108 (2-95 in a sample of college students). Mason A. Carpenter

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