Leading in a Connected World:: How Effective Leaders Drive Results Through Networks

Abstract

I t was the end of a long day at one of the world’s leading banks, when former president Bill Clinton began his keynote remarks on the importance of networks. The 300 bankers in the room were tired – they had been together for 12 hours straight. Yet, you could have heard a pin drop as Clinton described how networks had been critical to his success. Early in his career, Clinton had used his connections with other governors to learn how to excel in that role. Later, as president of the United States, networks proved vital to managing the give-and-take of demands and concessions among the world’s power brokers. His reflections offered an inside view of the central role that Clinton’s network had played throughout his career. They also gave a personal voice to 20 years of research demonstrating that leaders whomake targeted investments in relationships outperform those who simply build ever-larger networks, or ignore the importance of connections altogether. The bank had invited us, as well as the former president, to speak as part of a program for its top performers at the vice president and senior vice president level. This particular event, held early in 2007, was a reunion of sorts for these top performers. Over the course of the preceding year, all of them had participated in a development program designed to identify their managerial competencies, improve their capacity to work in non-hierarchical teams, and expand their knowledge of the firm’s businesses. This program had two primary goals. First, the bank hoped to increase retention of its top-performing vice presidents, who tended to depart at a higher rate than those at more senior levels. Second, senior leaders sought to form lateral networks across divisions and regions so the firm could better serve clients and execute on its ‘‘one firm’’ strategy. Too often, the rising stars at the bankwould dowell for a while but then fade when the demands of their jobs required more than individual expertise and the willingness to work just a little harder. As a result, a large part of our work with these high performers was focused on how they could build personal networks that would extend their individual competencies. Of course investment bankers are a tough sell on some of these ‘‘softer’’ skills, so our first job was to illustrate how more-productive networks would yield key business and career outcomes. Our audience was composed of vice presidents (VPs) and newly promoted senior vice presidents (SVPs). Given the rise in status that accompanies promotion at an investment bank, the newly minted SVPs were the envy of the room. When we described how these SVPs had qualitatively different networks from the VPs, we had everyone’s attention. The message was simple but powerful: your network determines, in part, the size of your paycheck. But it is not just a big network that enables high performance. Instead, what distinguished the highest performers was a set of connections that bridged the organization in important ways. For example, the SVPs’ networks were more likely than those of the VPs to include people in different divisions, those with unique industry or product expertise, and those in different tenure groupings – people who had spent either less time or more time at the bank. And the professionals who were promoted to SVP most quickly were also the ones most likely to reach out to people in different regions aswell as to people in the categoriesmentioned above. These and other insights on the networks of high performers at the bank helped our audience plan how best to build networks that would enable their continued success. We also showed the group that these rising stars were not only high producers, but also critical in integrating the bank’s divisions and regions in ways that helped deliver more holistic solutions to key clients. The bank needed many more of these wellpositioned employees in order to execute on its strategy to bring the very best of the firm to each major account. Our Organizational Network Analysis (ONA) covered sales-oriented product groups from a variety of locations that catered to corporate, government, and Organizational Dynamics, Vol. 38, No. 2, pp. 93–105, 2009 ISSN 0090-2616/$ – see frontmatter 2009 Elsevier Inc. All rights reserved. doi:10.1016/j.orgdyn.2009.02.006 www.elsevier.com/locate/orgdyn