IN THE 1980s, Heidi Roizen was the CEO of the spreadsheet software company T/Maker and president of the Software Publishers Association. After her company was purchased in the 1990s, Roizen became vice president of worldwide software developer relations at Apple Computer. After leaving Apple, she became a partner at the venture capital firms Softbank and, later, Mobius, serving on boards of high-tech companies and making investment decisions about which companies and technologies to back financially. Nothing unusual about this career in software and high technology, except maybe for the level of success—that is, until you realize that Roizen’s bachelor’s degree was in creative writing and her master’s was in business, not computer science, engineering, or mathematics. Roizen’s success was built on her intelligence and business competence combined with her ability to build strategic social relationships—to network—both inside and outside her employers. Her first job following her undergraduate years was editing the company newsletter at Tandem Computer. That was a great starting position as her job required her to interact with people throughout the company, including those at senior levels, who came to know her and appreciate her talents.

The subject of a Harvard Business School case study, Roizen is often used as an example of someone who succeeded on the basis of her networking abilities.¹ Students are often perplexed and even upset that a person could hold senior positions in important software organizations and even lead the major industry group without a technical background. Holding aside Roizen’s considerable substantive business skills, people miss the point: some jobs are mostly about networking and everyone can benefit from developing more efficient and effective social networks and honing networking skills.

A DEFINITION OF NETWORKING AND NETWORKING SKILLS

If we’re going to talk about networking, we better define it and, in that process, describe the behaviors that you might consider doing more frequently. Two German professors, Hans-Georg Wolff and Klaus Moser, offer a good definition of networking: “Behaviors that are aimed at building, maintaining, and using informal relationships that possess the (potential) benefit of facilitating work-related activities of individuals by voluntarily gaining access to resources and maximizing…advantages.”² Their study of more than 200 people in Germany developed some scales of networking behaviors that demonstrate what actions are required. These included:

• 1. Building internal contacts (e.g., “I use company events to make new contacts.”)
• 2. Maintaining internal contacts (e.g., “I catch up with colleagues from other departments about what they are working on.”)
• 3. Using internal contacts (e.g., “I use my contacts with colleagues in other departments in order to get confidential advice in business matters.”)
• 4. Building external contacts (e.g., “I accept invitations to official functions or festivities out of professional interest.”)
• 5. Maintaining external contacts (e.g., “I ask others to give my regards to business acquaintances outside of our company.”)
• 6. Using external contacts (e.g., “I exchange professional tips and hints with acquaintances from other organizations.”)³

The networking behaviors they describe entail making some incremental effort to build, maintain, and use social ties with people. The people targeted are not necessarily in your sights if you are focused just on your immediate job and company.

NETWORKING JOBS

Many of the positions Roizen has held, including manager of software developer relations at Apple and venture capitalist, are, at their core, jobs that entail bringing together different parties who would otherwise not be in contact. Venture capital involves bridging the gap between people and institutions who have money to invest and entrepreneurs with business ideas who need capital. The role of the venture capitalist also entails helping start-ups find talent and occasionally business partners to assist in distribution or product development, and an extensive set of contacts is obviously helpful in these tasks. Roizen’s job at Apple linked the software development community to a computer company that relied on these developers to build products that improved the usefulness and therefore the marketability of its machines.

In general, jobs high in networking content require bridging separate organizations, brokering deals, and relationship building to influence decision making. When in 1966 Jack Valenti left his position as a White House aide to become head of the Motion Picture Association of America, he could provide political access to the movie studios that needed help staving off censorship and dealing with foreign governments on commercial issues, including the repatriation of funds. At the same time, he could provide an entrée to Hollywood and its enormous fundraising potential for the Democratic Party and Valenti’s patron, Lyndon Johnson. When Valenti finally stepped down, he was replaced by the former Kansas congressman and Clinton’s agriculture secretary Dan Glickman, another Democratic politician with strong Washington establishment connections.

The Pharmaceutical Research and Manufacturers of America is closer to the Republican Party. PhRMA represents U.S. drug companies, which face numerous political problems ranging from staving off the importation of medicines from Canada to maintaining the right to continue direct-to-consumer advertising of prescription drugs, Consequently, in 2005 it appointed as its head Billy Tauzin from Louisiana, who had served in the House of Representatives from 1980, including serving in the Republican leadership and as chairman of the Energy and Commerce Committee, which has some responsibility for overseeing the drug industry. Tauzin had already been helpful to the drug industry as one of the leaders passing the expansion of Medicare to cover drug costs during the Bush administration.

Networking skills are not just important in the public sector or in brokering transactions across organizational boundaries. Inside companies, the job of project or product manager entails getting disparate groups to cooperate in making information technology projects work and in managing consumer products successfully. There are many leadership tasks where the essence of the work is bringing people and organizational units with different competencies and perspectives together to complete a task or consummate a transaction.

THE ABILITY TO NETWORK IS IMPORTANT IN MOST JOBS

Although your social network—sometimes referred to as social capital—is more or less important depending on the specifics of your job, the evidence shows that networking is important for people’s careers, period. Many studies show that networking is positively related to obtaining good performance evaluations, objective measures of career success such as salary and organizational level, and subjective attitudes assessing career satisfaction.⁴ There is a problem with many of these studies in that networking and success are measured at the same time, so it is not clear what is causing what. For instance, it may be that successful people have more social contacts not because the networking produced their success but because others want to be in touch with them to obtain the benefits of their status. Thus, the study by the German academics Wolff and Moser is particularly informative because of its longitudinal design. They measured networking behavior in October 2001 and then did follow-up surveys late in 2002 and 2003 with more than 200 employees in Germany. Their measures of career success were total compensation and a career satisfaction scale. Networking affected career satisfaction, concurrent salary, and salary growth over time, with the two most important networking behaviors being “maintaining external contacts” and “building internal contacts.”⁵

Another longitudinal investigation considered the effect of being competent at networking on career advancement. This study, by Italian business school professor Arnaldo Camuffo and some colleagues, sought to assess the effect of MBA education by looking at what happened to people who graduated from a part-time MBA program in Venice. Competencies were assessed by the students themselves, their classroom peers, and objective observers using structured interviews. Competencies did affect career advancement as measured by both salary progress and promotions. The study showed that networking was the second most important competency, following only the use of technology in importance in explaining how well these managers did. This study plus research in Germany and Australia shows that networking is important in business contexts outside of the United States, too.

We have previously discussed at least one mechanism that makes networking important for career success—salience. You can’t select what you can’t remember, and that includes professional advisers, candidates for leadership positions, or job applicants. The effect of mere exposure on preference and choice is important and well demonstrated. Networking brings you into contact with more people and keeps you in contact with them, thereby increasing the chances that when they need advice, want to find an investment partner, or are thinking of a candidate for some position, they will remember you. Thus, effective networking creates a virtuous cycle. Networking makes you more visible; this visibility increases your power and status; and your heightened power and status then make building and maintaining social contacts easier.

NETWORK SKILLS CAN BE TAUGHT AND LEARNED

Although people have different levels of social skill and different preferences for how they spend their time, there is some evidence that people can learn how to diagnose network structures and become more effective in developing their social capital, with positive effects on their career. University of Chicago professor Ronald Burt worked with the Raytheon Company to develop an executive education program, called the Business Leadership Program, with a strong network component. Raytheon, a large electronics and defense contracting company, faced the challenge of “how to coordinate across the organization silos of its acquired companies and its many product programs.”⁶ BLP was offered to directors and vice presidents to enhance their ability to get things done across internal organizational boundaries.

Evaluation of training is inherently difficult, because in the real world, people are not randomly selected to attend (expensive) executive development activities. Because more senior and more highly rated and capable people are those typically chosen to participate, the fact that such people typically do better along numerous dimensions is not surprising, nor does it reflect the effects of the program. To deal with this issue, the researchers estimated an equation predicting who would be chosen to attend sessions of the BLP. They then constructed a control group of people predicted to be eligible to attend the program but who had not yet attended, either because of scheduling constraints or because the program had not yet included all of its intended beneficiaries. They also could compare the results of people attending the program to those who didn’t attend and who wouldn’t be predicted to be eligible to attend.

The people who attended the program and learned how to diagnose and use networks received 35 percent higher scores on their performance evaluations than did the control group. Program attendees had a 43 percent higher likelihood of being promoted subsequently. And people who attended this executive training experience were 42 percent less likely to leave the organization. These results and others that show favorable evaluations of the program and an enhanced ability to diagnose networks provide a demonstration that skills in building social capital can be increased.

SPEND SUFFICIENT TIME

If networking is so helpful for people’s job performance and career success, the obvious question is, why do some people devote insufficient time and attention to the activity? One answer is the effort required. Another possibility is that some people find the activity distasteful because they believe it is insincere to build relationships with people for instrumental purposes. And a third answer is that people undervalue the importance of social relationships and overvalue other aspects of job performance in thinking about what produces career success. The evidence shows that networking is important in affecting career progress, and you need to get over qualms about engaging in strategic behavior to advance your career—and that includes who you are in touch with.

Networking actually does not take that much time and effort. It mostly takes thought and planning. Keith Ferrazzi’s book title Never Eat Alone makes the point. People are going to eat and exercise anyway—why not use that time to expand your network of contacts? When Ferrazzi turned 40, he didn’t have one birthday party; he had seven, in seven different cities around the United States, hosted by seven different friends. A birthday celebration became a wonderful opportunity to renew existing social ties and build new ones. Heidi Roizen does what many people do—sends out a holiday letter with some pictures and stories about her family. The difference—she gets about 700 copies printed and mailed. When she took the original in to be reproduced and told the vendor how many she wanted, the response was, “Lady, no one has that many friends.” But Roizen recognizes that an occasional note, for instance, at the holidays, or an occasional e-mail or lunch or short phone call keeps you in front of and salient to a set of people who can be helpful to you or may call on you for help.

Ignacio, an Argentinean who graduated from a prestigious U.S. business school, did what many such graduates do—he went to work for the office of a large, high-status management consulting company back in his home country. But he did one thing that distinguished him from many of his colleagues in the firm or, for that matter, in the country: in June 2007, he set up an “MBA en USA” network and website in Argentina with the goal of increasing the number of Argentinean applicants and students in top U.S. schools—the institutions that supply guaranteed financing for those admitted to the program. In two years, he has recruited almost 400 members, with a 10-person board of directors; made presentations in three universities; and become the reference person for Argentineans pursuing U.S. business education opportunities. When he began this network, it consisted of one person, himself. Because he had neither great credentials nor high status, he involved others with high status, including those from his consulting firm and alumni of leading U.S. business schools living and working in Argentina, in his presentations and efforts. The results: Ignacio has become known in his office as a great speaker who is good at coaching others; he has substantially enhanced his visibility and built many more connections not just in Argentina but with the leading consulting firms in the United States; and he is at the center of an expanding network of companies, universities, students, and alumni. Not bad, for a very part-time and inexpensive initiative.

Because networking does entail some effort, you ought to be strategic about your networking activities. Make a list of people you want or need to meet and organizations where some personal connection might be helpful. Work your way down that list, figuring out ways to build social relationships with a wider and more diverse set of individuals. A person I know wanted to build a career in biotech even though he did not have a scientific background or any experience in the industry. He targeted people to meet, asking others to introduce him when possible, followed up after meetings with thank-yous, and provided information and contacts to the people he had met so they would receive value from interacting with him. In a short time, proceeding from a position of little formal power, he developed a large and influential network of contacts in the industry that helped him launch his career in biotechnology.

Another barrier that seems to stand in the way of networking is that people naturally fall into habits, and one habit is interacting with the same set of people all the time. You get comfortable with them, you come to trust them, and it is easier and more pleasant to interact with people you already know than to build relationships with strangers. So go out of your way to meet new people. Katie works at an executive recruiting company. Executive recruiting assignments come, in part, from the human resources department. To build a network of HR managers and to meet more people to help her in her job, Katie organized short seminars in which participants would read and listen to and then discuss ideas from thought leaders in managing people. Her very first meeting was a big success, with lots of participants, a lively discussion, and the creation of an ongoing forum that will be very useful for Katie in her current job and in building relationships useful to her future career. Once again, not that much work. All that was required was some initiative and being willing to reach out to strangers—to get out of one’s comfort zone.

NETWORK WITH THE RIGHT PEOPLE

Not everyone is going to be equally useful to you and you should account for that fact in how you spend your networking time. In the early 1970s, sociologist Mark Granovetter conducted a classic study in Boston about how people find jobs.⁷ Two of his findings are scarcely surprising. Granovetter found that social ties were important in the job-finding process and the more one used social ties, as contrasted with less personal mechanisms such as formal applications, the better the job the individual found. He also found that the process used to fill jobs differed by job type: managerial jobs were more likely to be found through personal contacts rather than through more formal means such as responding to newspaper advertisements or making a formal application, whereas lower-level or even well-paid but technical jobs tended to rely on more formal means of hiring. What was surprising was the type of social ties that mattered in the job-finding process: weak ties.⁸ Strong ties are typically with family, friends, and close associates at work and involve frequent interaction. Weak ties are with casual acquaintances, people you hardly know and with whom you have fairly infrequent interactions.

The intuition behind the idea that weak ties are frequently more useful than stronger ones is that the people you are closest to, your close friends and family, are more likely to travel in the same circles, be close to each other also, and therefore provide redundant information. Weak ties, by contrast, are more likely to link you to new people, organizations, and information, providing new information and contacts. For weak ties to be useful, however, two things must be true: casual acquaintances must be able to link you into diverse networks and they must be willing to do so. Frank Flynn’s research on asking, reviewed earlier, shows that people are likely to comply with small requests, even from perfect strangers. Asking someone if she knows about a job opening or about the particulars of a company or job will almost always produce information even if the relationship is fairly weak and casual. Providing any information lets the provider feel good about herself and is consistent with social norms of benevolence.

Consequently, an optimal networking strategy is to know a lot of different people from different circles, have multiple organizational affiliations in a variety of different industries and sectors that are geographically dispersed, but not necessarily to know the people well or to develop close ties with them. This advice does not imply that the relationships aren’t genuine, just that the social ties are not so close that it becomes difficult, because of time constraints, to build as large and diverse a set of contacts. This advice is not inconsistent with the advice in chapter 2 to focus your efforts. You are focusing your efforts on building social ties that can be helpful—it’s just that such ties should be as many and as diverse as possible and useful for your obtaining power.

It’s also the case that both organizations and people are known by the company they keep—so it behooves you to associate with high-status people. This simple fact has interesting consequences, for it means that you cannot readily move down the status food chain to take advantage of opportunities if you don’t want to risk losing your own status. Joel Podolny, a sociologist who was former dean of the business school at Yale and currently heads Apple University, asked an interesting question about investment banks: because high-status investment banks have cost advantages deriving from their status (as just one example, they can raise money at lower cost than lower-status and presumably riskier banks), why don’t they dominate the market for both equity and debt securities, over time taking away most of the business from their lower-status competitors? His answer, from an empirical study of the investment banking industry, is that higher-status banks are constrained from “moving down” and capturing more of the market because in doing so, they would have to associate with lower-status securities issuers and, as a result, lose at least some of their status advantage.⁹

One way to acquire status is to start an organization that is so compelling in its mission that high-status people join the project and you build both status and a network of important relationships. That’s what Philippe did in Mexico. Mexico is a highly stratified society and many of the people who do manual and unskilled labor have little education. Because of these educational deficits, people cannot get better jobs and are consigned to a life of poverty. Philippe started a foundation to educate unskilled workers, mostly in the construction industry, which is a large employer of unskilled and semiskilled labor. The social importance of such an activity attracted the most prestigious professor from his engineering school and a board that consisted of some of the top social entrepreneurs in Mexico. Because the foundation’s work focused mostly on construction workers, Philippe got access to the best people in the real estate industry, and these social contacts have opened numerous real estate career opportunities as well as built a large and influential network of people from both the private sector and the government. As Philippe explained, he was both doing good and doing well.

The fact that status hierarchies are stable means not only that it is difficult to move up but also that it is difficult to move down. Once you have achieved power and status through the network of your relationships, you will be able to maintain your influence without expending as much time and effort.

You can monetize your high-status network. I have a friend who is a well-known executive coach. A while ago he was asked to submit a proposal to coach a certain CEO. His price: $250,000. The CEO told my friend that he had received a proposal from another coach for $25,000. My colleague replied that he knew and had trained the person supplying the lower-priced bid, and he thought the quality of this other coach’s work was exceptional. Why should the CEO choose him, at 10 times the price? Because, the executive coach noted, he was having dinner with the CEOs of several large, prominent companies (whom he named). Could the other coach provide such access and a similar sort of experience? He got the business. People like to bask in reflected glory and associate with high-status others. Versions of this story in different contexts happen every day.

CREATE A STRONG STRUCTURAL POSITION

Power and influence come not just from the extensiveness of your network and the status of its members, but also from your structural position within that network. Centrality matters. Research shows that centrality within both advice and friendship networks produces many benefits, including access to information, positive performance ratings, and higher pay.¹⁰ One study at a newspaper publishing company found that “being in a position to control communications within the department is particularly important to being promoted.”¹¹ These results contradict the idea from human capital economics that it is only individual human capital—education, years of experience, and intelligence—that matters for people’s careers, as well as the commonly held belief that job performance determines career outcomes. Network position matters a great deal for your influence and career trajectory.

If virtually all information and communication flows through you, you will have more power. One source of your power will be your control over the flow of information, and another is that people attribute power to individuals who are central. You can assess your centrality by asking what proportion of others in your work, for instance, nominate you as someone they go to for advice or help with their own work. Another way of assessing centrality is to ask what proportion of all communication links flow through you.

If you are sensitive to the importance of centrality, you can do things and make choices that increase your structural centrality. When Henry Kissinger became President Nixon’s national security adviser, he made sure that communication about foreign policy issues flowed only through him. He appointed a staff of young, talented, nonpartisan foreign policy analysts to work with him. This move gave Kissinger a good image with the press because it appeared that he was just interested in obtaining talent. But because the Nixon loyalists were uncomfortable interacting with people so different from themselves, and the staffers were estranged from the Nixon people, Kissinger was at the center of the flow of information between the NSC staff and the White House.¹²

One way of building centrality is through physical location. A person I know took a job at a Silicon Valley venture capital firm as an analyst, a low-level position. When he started at the company, he had two options as to where to locate his desk: a large cubicle in the corner that was quiet but outside of the flow of traffic, or a small workstation outside the named partner’s office, which had no walls and no privacy. Almost by chance he chose the location outside the partner’s office. Because of his location, he knew what was going on in the firm and interacted with the numerous people coming by to see the partners. As he noted, “Within just a few months of starting, at the weekly Monday morning all-hands meeting, nearly every question began to be pointed in my direction. The net of it was that I was the first analyst in the firm’s history to be invited for a position after graduation.”

Centrality provides power within a network, but it is also important to have power through connections across diverse networks. Most people tend to associate with those similar to themselves—a tendency called homophily. Consequently, groups that might gain from interacting with other groups don’t do so, because group members are more comfortable associating with the people in their own group. This natural tendency to associate with those close to us creates an opportunity for profiting by building brokerage relations—or, to use the terminology of University of Chicago business school professor Ronald Burt, by bridging the structural holes that exist between noninteracting groups.¹³ The fundamental idea is deceptively simple: by connecting units that are tightly linked internally but socially isolated from each other, the person doing the connecting can profit by being the intermediary who facilitates interactions between the two groups.

Consider the case of Kenji, working in a large Japanese electric utility. Kenji, with an undergraduate degree in nuclear engineering and an MBA, speaks both English and Japanese. When he returned to his company following his postgraduate education, he went into international business development, where he worked building and acquiring power plants all over the world. Even though Kenji had a low job title and little seniority in a culture where seniority was valued, he was in a great position to broker relations between important departments—engineering and business development. He was the only MBA with a degree in nuclear engineering and the only nuclear engineer with a business degree. He told me, “Right now I am in a unique position, where critical information related to business development in the global nuclear power sector flows through me since I am the only one who is well connected to both the international division and the nuclear division.” Because Kenji’s English skills were better than many of his colleagues’, he was invited to participate in telephone calls with some of the most senior people on international development projects to help with the translation. Because of his access to information from brokering relations between engineering and the international business development people and the insights he acquired from his participation in many calls about projects, senior managers began consulting Kenji on a number of important topics.

Although it is too soon to tell how things will work out for Kenji on his path to power, the research strongly suggests that occupying brokerage positions—filling structural holes—is advantageous for one’s career. Social capital, measured by how many structural holes an individual bridges, positively affects promotions, salary, and organizational level attained. Other research discovered that social capital also increases an individual’s returns to personal attributes such as education and experience—education and years of work have a greater effect on the salaries of individuals who are rich in social capital.

One other research finding is important for the building of social networks. People sometimes believe that if they are connected to someone else who occupies a good brokerage position, they can achieve almost as much benefit. However, Ron Burt found that this intuition was not accurate. People even one step removed from the person doing the brokerage enjoyed virtually no benefit.¹⁴ To return to the Japanese electric utility example, while Kenji enjoys many benefits from his network position, someone who is connected to Kenji profits very little. You have to do the network “work” yourself if you want to accrue the benefits.

RECOGNIZE THE TRADE-OFFS

You can overdo any strategy, including networking. Bridging structural holes and being in the center of many social ties requires time. You should decide how much time to spend and your specific networking strategy based on the extent to which your job requires building social relationships for you to be successful—a topic already considered in this chapter—and the type of knowledge most useful in your job.

The research literature typically divides knowledge into two types: explicit, codified knowledge such as that represented in diagrams, formulas, or “recipes” for task performance; and implicit, tacit knowledge such as that possessed by good clinicians who understand not only the scientific basis of job performance but also know, based on their experience, when to do what. University of California–Berkeley professor Morten Hansen has studied what types of social networks are most useful given different types of product development efforts. When you need to access tacit knowledge, a smaller network of close ties is important because it takes close relationships to get people to spend the time to explain their tacit expertise. When the project requires locating explicit knowledge that can be readily transferred once you find it, a large network of weak ties provides greater benefit.

Hansen also distinguishes between product development efforts that entail doing very new things, where the type of information required was almost impossible to specify in advance, and product development projects using existing competencies and information that could mostly be anticipated. Hansen and his colleagues found that a network rich in weak ties was most useful for doing new things because a large network of weak ties permitted product development teams to explore broadly for information that was helpful. In contrast, when the product development effort leveraged well-established existing competencies, a smaller network got the product out the door more quickly.¹⁵ Hansen’s research empirically demonstrates what many people intuitively know: a large network of weak ties is good for innovation and locating information, while a small network of strong ties is better suited to exploiting existing knowledge and transferring tacit skills.

Both in the process of creating social ties and once you have created a network, your ability to create and leverage social ties depends in part on how others perceive you. And those perceptions depend in part on your ability to speak and act with power. That is the focus of chapter 7.