Losing My Direction - Merging Formal And Informal Networks (Part 1 - Formal Networks)
During the transformation process of my old company - Pod Group - I focused on trying to change the environment in the hope that people would change as well. Whilst it was partly successful, with the benefit of hindsight, I should have spent more time understanding how the hierarchy, roles, tasks and processes (the formal network) interacted with how things were actually done outside of the formal network. With this understanding, I could have been more confident to use the informal network, namely social connections formed with colleagues at work, as a base on which the formal network could be built, rather than focusing on changing the formal network on its own.
Some of this hindsight has arisen as a result of researching for a doctorate on how formal and informal networks can be changed to enhance human skills. Oddly, surprisingly little research has been undertaken on the interplay between formal and informal networks - but overlooking their need to be viewed together is a fundamental error when implementing managerial change.
The changing sands of time
In the early days of management theory when employees were meant to carry out tasks without thinking (in effect acting as robots), the only focus was on the formal network. How employees interacted informally was thought of as irrelevant in a workplace influenced by the practices of Frederick Winslow Taylor, where efficiency and productivity were the priorities. To quote Taylor “In the past the man has been first; in the future the system must be first.”
As covered by McEvily, Soda and Tortoriello in a 2014 paper on Rediscovering the Missing Link between Formal Organization and Informal Social Structure, by the time of the second world war there was an understanding that both formal and informal networks played a role in how organizations function. However, academically, the focus on formal networks still dominated until twenty or thirty years ago when a shift came about to try and explain organizational behaviour through the lens of informal networks. This shift, however, tended to look at informal networks in isolation, and the convergence between formal and informal networks has still yet to be extensively explored, except by a few academics such as Bill McEvily and Giuseppe Soda (and I hope to be added to this list).
Formal networks
Why do organisations need formal networks? As pointed out by various academics including Lex Donaldson in his controversial 1995 book American Anti-management Theories of Organization, formal structures are required to balance efficient decision making processes with the need for control. The downside of the need for control is the danger of creating a self-perpetuating cycle of an ever larger formal structure. In their 2014 paper, McEvily et al bring together the argument from various researchers - namely that “organizations deal with administrative complexity by trying to reduce uncertainty: they formalize activities, employ cost and quality controls, and specialize management and staff positions.” The result of this is that even more formality is required to manage tasks and departments. However, with more departments comes the need for more formal roles to cover more liaison and cross department communication. And the cycle continues. Therefore, the balance between too large a formal network (or bureaucracy) and not enough is a difficult balance to strike and often explains the success or failure of companies.
Unlike emergent informal networks which I cover in a subsequent article, the weakness of formal networks is also their strength. Formal networks rely on positions, authority and processes that are independent of who is appointed to each position. This removes some of the dependence on the quality of individuals, given that the role remains the same regardless of who fills it. However, their weakness, as covered in the conclusion of this article, lies in how well (or poorly) the formal structure has been designed in the first place.