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Business Research for Business Leaders
31 Jul 2008Working Paper Summaries

Communication (and Coordination?) in a Modern, Complex Organization

by Adam M. Kleinbaum, Toby E. Stuart and Michael L. Tushman
Coordination, and the communication it implies, is central to the very existence of organizations. Despite their fundamental role in the purpose of organizations, scholars have little understanding of actual interaction patterns in modern, complex, multiunit firms. To open the proverbial "black box" and begin to reveal the internal wiring of the firm, this paper presents a detailed, descriptive analysis of the network of communications among members of a large, structurally, functionally, geographically, and strategically diverse firm. The full data set comprises more than 100 million electronic mail messages and over 60 million electronic calendar entries for a sample of more 30,000 employees over a three-month period in 2006. Key concepts include:
  • Communication is heavily constrained by formal organizational structure: the vast majority of communication occurs within business unit and functional boundaries, not across them. This points to the importance of drawing the right organizational boundaries.
  • Women, mid- to high-level executives, and members of the executive management, sales, and marketing functions are most likely to participate in cross-group communications.
  • These individuals provide a bridge for distant groups in a company's social structure.

Author Abstract

This is a descriptive study of the structure of communications in a modern organization. We analyze a dataset with millions of electronic mail messages, calendar meetings and teleconferences for many thousands of employees of a single, multidivisional firm during a three-month period in calendar 2006. The basic question we explore asks, what is the role of observable (to us) boundaries between individuals in structuring communications inside the firm? We measure three general types of boundaries: organizational boundaries (strategic business unit and function memberships), spatial boundaries (office locations and inter-office distances), and social categories (gender, tenure within the firm). In dyad-level models of the probability that pairs of individuals communicate, we find very large effects of formal organization structure and spatial collocation on the rate of communication. Homophily effects based on sociodemographic categories are much weaker. In individual-level regressions of engagement in category-spanning communication patterns, we find that women, mid- to high-level executives, and members of the executive management, sales and marketing functions are most likely to participate in cross-group communications. In effect, these individuals bridge the lacunae between distant groups in the company's social structure. Email Adam Kleinbaum and Toby Stuart.

Paper Information

Michael L. Tushman
Michael L. Tushman
Baker Foundation Professor
Paul R. Lawrence MBA Class of 1942 Professor of Business Administration, Emeritus
Charles B. (Tex) Thornton Chair of the Advanced Management Program
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