Trafficking In Trust

When leaders don’t do their homework and fail to establish their networks, then other factors, like gender, take center stage. That’s why recognizing and understanding the social networks in workplaces is of utmost importance to women in leadership.

Book Excerpt:
Enlightened Power: How Women are Transforming the Practice of Leadership
by Linda Coughlin (Editor), et al

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Trafficking In Trust
The Art and Science of Human Knowledge Networks

by Karen Stephenson

She had been mentored by the very best. It was all because the CEO had had an epiphany. He had looked around his company and seen that he was wheeling and dealing mostly with men—where were the women in the equation? Why weren’t they involved? And then he realized that he was the sole party responsible for both the absence and silence of women. In a quiet promise to himself, he decided to change the context and shift the equation. And he did—she was now CEO. But the appointment alone was not enough to garner the impact he sought. Oh sure, he saw the press rally ‘round her—both praising and picking. But that’s not the kind of recognition he was expecting for his new successor. Instead, what he saw was that the male managers within the enterprise didn’t trust the new female CEO—perhaps because they had difficulty trusting any woman. Quite frankly, he had not spent much time in nurturing those relationships to get past that ol’ familiar “gender issue.” He also saw that women managers did not trust the new woman CEO either! Did she sell out? What did she do that they had not done or would not do? Surely her promotion was not the result of mere meritocracy! If time is appropriately spent in building collegial relationships in the leadership network, gender issues can become irrelevant. But when leaders don’t do their homework and fail to establish their networks, then other factors, like gender, take center stage. In the final analysis, merit matters, but only when networks are nurtured.

Why are relationships so important to succeed in the business world? I have spent my entire professional career in hot pursuit of this single question. I’ve come to realize that the only way to inspire change, stir activity, or get anything done at all is to explore the hidden world of social networks—”grey markets” of rights, riddles, and rituals. Such social networks exist within your organization. And if you are a woman leader, these are forces that you should not and cannot ignore. Indeed, because women leaders have so long been on the outside looking in, they need to understand the various sources of power that exist within an organization. It’s not just about simple and straightforward hierarchy anymore. It’s also about social networks. Recognizing, understanding, and leveraging these social networks are critical for women leaders who want or need to secure power within their organizations.

I am talking about how the relationships between people in an organization create the real pathways of knowledge, for the actual power of an organization exists in the structure of a human network, not in the architecture of command and control superimposed on it. My work is about making invisible workplace relationships visible by computer modeling the web of social exchange. And the data always reveal some significant answers to a host of significant questions: Who is talking to whom (before and after the formal agenda-driven meeting)? Where do ideas get bottlenecked, and how do they get widely dispersed? Who has the authority, and who has the ability to make things happen? Why are the top salespeople effective and what does that have to do with their proximity to customer service? Which candidate for CEO has a finger on the pulse of the organization, and which candidate has merely grabbed the current CEO’s ear? Who among the senior partners is informally mentoring a younger generation of potential successors, and what does that have to do with their smoking habits? Why is the merger, which looked so promising on paper, failing to gel? Why did the latest middle-management layoffs, less severe than in previous rounds, leave the organization so much more decimated? Why did one factory plant become so efficient as compared to two identical ones?

By x-raying the social network of an organization, we in effect provide another and new way of seeing. Until very recently, we perceived organizations as a structural hierarchy that was both blind and deaf to another life force fomenting within. Tacit knowledge—the critical information that makes organizations functional—is in fact transferred not through established channels within the formal hierarchy but instead through informal relationships. And the medium of exchange is not just the authority of transactions but, significantly, the trust within relationships.

Without an understanding of this other world and its operating principles, women leaders will find genuine power to be potentially within their grasp yet nevertheless, frustratingly, at arm’s length. And they will be marginally effective, at best, at managing and influencing their own culture. The missteps and misreads that result during reorganizations, layoffs, strategic initiatives, and promotion decisions are just a few signs of a larger cultural illiteracy that can bedevil all leaders (male and female) who fail to understand the social networks at work.

Such corporate failings usually indicate an incomplete portfolio of knowledge. An over reliance on explicit, procedural knowledge that can be readily taught or passed on in notes, instructions, or textbooks is the culprit. Tacit knowledge, in contrast, is developed through embodied experience; stored away in impressions, intuition, and instinct; and subsequently shared with trusted colleagues. The best leaders understand that this knowledge is a critical component of success. How one interacts with customers, navigates a bureaucracy, generates innovations, blows off steam without stressing the system, or increases the efficiency of a warehouse storage facility is not information that is always readily accessible. Such knowledge cannot be stored in databases or captured in instructional manuals so that it can be tapped when needed. Instead, it invisibly resides in each person’s knowledge bank and is exchanged, distributed, or blocked depending on who that person encounters, trusts, or fears.

For a long time I did not realize that by studying networks I was actually staring at trust. Knowledge is biased and does not travel neutrally like currency in an electronic communication network or currents in utility lines. Instead, knowledge ebbs and flows down hallways, in meetings, and in private conversations inside and outside the office. The key to the way that knowledge travels lies in the relationships that can bypass the standard organization chart. The quality, kind, and extent of those relationships are much more influential than most leaders recognize. Relationships are the true medium of knowledge exchange, and trust is the glue that holds them altogether.

What does all this mean for the individual woman leader? Among other things, it dictates that her effectiveness and power depend not on her position or title but, instead, on her connections to others in a variety of intertwined networks. As a woman leader, you have to pay attention to those many and varied connections. And you have to make sure that those relationships are infused with trust. Only then can you fully access the many important strands of knowledge existing in your organization’s social networks.

Despite the perceived authority of the formal hierarchy, an organization’s real value is at the mercy of its social networks. Let’s take three examples that evidence the impact of relationships, trust, and social networks in everyday work life: mentoring, contract law, and office politics.

Mentoring is one of the oldest forms of knowledge transfer and, in many ways, still the most efficient. Mentoring programs that thrive do so because they rely on the building of a real relationship between mentor and mentee. Mentoring programs that fail do so because they force the relationship on the participants without the understanding that trust is the foundation for the real connection. It is the quality, not quantity, of reciprocal exchange that is proportional to a high level of trust.

Contracts that adjudicate between organizations fill a void where trust has not yet formed by controlling for the costs of transactions across organizational divisions. At the same time, when trust is present, contracts ensure that there is clean separation between transaction costs and trust so that the relationship may continue unfettered.

In terms of office politics, how many successful executive underlings have found that it is critical to gain the trust of the CEO’s administrative assistant? Without tacit knowledge of the CEO’s time constraints, meeting availability, priorities, and moods (which the top executive assistant can choose to share or withhold), it is unlikely that one will succeed in effectively communicating with the CEO.

I have personally conducted many network analyses. And I have done so as an anthropologist. My goal here has been to decipher what real working knowledge is. People in organizations, are intimately familiar with their own context, while the anthropologist is not. To a real extent people are right about what they are describing to me—it is their reality. But they know too much and see too little. That’s where an anthropologist’s interpretive eye serves as a corrective lens. What do I mean?

Every time I step across the threshold of an organization, I remember the research done on children’s art. Most children draw what they know, not what they see. Similarly, when the untrained eye of a leader draws a picture of the organization, he or she does it on the basis of what he or she knows. The resulting image is usually a flattened organization chart, distorted in perspective; long on opinion and short on reality. To draw what you see, you must forget what you know. You must erase any preconceived notion of what the object is and draw only what is there. If all of us can do this, then we truly see.

The sad fact is that what people usually see inside their organizations is what they know—an explicit structure—in exactly the same way that we walk into any building and see its physical architecture. What they do not see is the shape of an invisible culture that fills the organization, in much the same way that people can’t see the shape of the space that fills a building. Although there is safety, security, and certainty in the explicit hierarchical structure of organized work, there is precious little representation of another, equally valid, and very real worldview of its hidden culture. By connecting the dots revealed by network analysis, an anthropologist can bring into focus an emergent, shadow world beneath the formal one.

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Karen Stephenson, a contributor to Enlightened Power: How Women Are Transforming the Practice of Leadership, is the President of NetForm and a Professor of Management at Harvard’s Graduate School of Design.