Vertical and Horizontal Cross‐Ties: Benefits of Cross‐Hierarchy and Cross‐Unit Ties for Innovative Projects

Abstract

Social networks are an important driver for successful innovation, both at the individual level as well as the organizational level. Recent research has also shaped that networks within teams can enhance performance. Innovative project teams are embedded in an organizational context, however, and teams typically consist of people with expertise from diverse backgrounds, and from different units. Team members may have ties to other teams, business units, and hierarchical levels. Although it seems clear that such ties can influence team performance, remarkably little research has focused on what is here referred to as vertical and horizontal cross‐ties. Previous research may have ignored the possibility that vertical and horizontal bridging ties may have different performance outcomes. Although the literature suggests that diversity of input, or horizontal cross‐unit ties will benefit team performance and innovativeness, there is reason to believe that ties to higher levels in the organization might have an effect on project team performance and innovativeness too. This article in particular studies the role of vertical cross‐hierarchy ties. In an exploratory analysis combining quantitative and qualitative results, it is distinguished between horizontal cross‐unit and vertical cross‐hierarchy ties and their contribution to new business development (NBD) project performance, thereby making a substantial contribution to both academic literature and managerial practice. Our study is based on a multiple case‐study approach of several NBD project teams in a large European financial service provider. Our results show that successful innovation project teams are characterized by a large number of cross‐unit ties in combination with a large number of cross‐hierarchical ties compared with less successful project teams. Additionally, proof is found that vertical cross‐hierarchy ties should be concentrated rather than scattered across project members.

Social Networks for Innovation and New Product Development

“…In this special issue, Aalbers, Dolfsma, and Leenders () present a case study of five new product development projects. They focus their analysis on the ties that project teams maintain throughout the company (to other teams or to management), and study whether these external ties support the innovative performance of the teams.…”

Rich Ties and Innovative Knowledge Transfer within a Firm

“…Additionally, Hansen (2002) argues that informal relations allow one to tap into new knowledge more easily. Informal relations provide the opportunity for information and knowledge to flow in both vertical and horizontal directions, contributing to the overall flexibility of the organization (Aalbers, Dolfsma and Leenders, 2014;Cross, Borgatti and Parker, 2002). Informally, individuals may be willing to exchange information and favours beyond what the organization has formally mandated them to do (Dolfsma, Van der Eijk and Jolink, 2009).…”

The Roles of Knowledge Providers, Knowledge Recipients, and Knowledge Usage in Bridging Structural Holes

“…Previous research has already shown that a focal firm (Firm A in the example) is in general likely to enjoy higher innovation capabilities because it can access nonredundant and heterogeneous knowledge from the otherwise disconnected firms in its ego network (Firms B, C, and D in the example) (Aalbers et al, 2016;Bonner and Walker, 2004;Burt, 2004;Knudsen, 2007;Operti and Carnabuci, 2014;Tortoriello and Krackhardt, 2010). However, focal firms are likely to differ when recognizing and deciding whether to acquire, integrate, and use the heterogeneous knowledge made available by bridging structural holes in their ego networks.…”

“…It has also suggested that given today's increased market competition and rapidly changing technologies, many firms may not be capable of engaging in innovation with their own internal knowledge but may need external knowledge (Powell, Koput, and Smith-Doerr, 1996). Consistently, studies have suggested that firms can significantly benefit from bridging two or more otherwise disconnected firms in their ego networks (i.e., structural holes) as a potentially useful source of external knowledge for innovation (e.g., Aalbers, Dolfsma, and Leenders, 2016;Bonner and Walker, 2004;Burt, 2004;Knudsen, 2007). These studies also suggested that this is because the disconnected firms are likely to offer the firms bridging them heterogeneous and nonredundant knowledge that is conducive for innovation.…”

“…Acknowledging these moderators that are based on the industrial, structural, and institutional dimensions of bridging structural holes, it can be argued that the strength of the relationship between bridging structural holes and firm innovation also depends on the knowledge dimensions of bridging structural holes. This study looks at the knowledge dimensions because knowledge plays a significant role in both innovation (e.g., Ozer, 2011b;Stanko, Fisher, and Bogers, 2017;Zobel, 2017) and network (Aalbers et al, 2016;Bonner and Walker, 2004;Burt, 2004;Knudsen, 2007) research. In addition, past research has shifted its focus from the structural elements of an ego network to its knowledge characteristics (Baum, Cowan, and Jonard, 2010;Rodan and Galunic, 2004).…”