Team Woot Rebuttal

The Pro Team appears to have misread many of our arguments, while making several false assertions of their own. For example, the opposition claims that we assume that “social networks are in and of themselves organizations,” when our opening remark in fact states that “all organizations are composed of networks, but not all networks are organizations.” In fact, much of our constructive argument was based on distinguishing between a network and an organization so as to emphasize the point that networks in and of themselves lack the characteristics necessary to make them the “main driver” of organizational success.

For example, we addressed the Occupy Wall Street movement to illustrate that a movement with a strong network of ties will never coalesce into an organization without additional steps, and argued that these additional steps are paramount to achieving organizational success. If social networks must make fundamental changes to become organizations, they can hardly be seen as the main driver of an organization’s success.

Our opponents point to a Jim Collins study that focuses on the importance of managing one’s internal employee structure to capitalize success as a refutation of our argument. We absolutely agree that “getting the right people on the bus” will have a significant impact on an organization’s operations; however, this claim does not address a fundamental flaw in our opponent’s position: An organization by definition needs to have a shared goal, and without capable leaders who direct the energies of the members of the organization toward that goal, an organization cannot be successful. Apple is not successful primarily because they have a strong internal social network; they are successful because they had a visionary who bucked market trends with a completely new idea and created an organization that can consistently attracts quality talent in the market. Steve Jobs was essential to creating this environment and must be given far more weight than any social network in Apple’s success.

On another front, it is curious that our opponent takes the time to attempt to define what an organization is but neglects to define a social network. The fact of the matter is that you cannot convincingly argue for the primacy of a variable (i.e. social networks) without defining the boundaries of what that variable is and is not. Doing so would have served them well, as several examples of what they argue as evidence of networks are in fact not explicit features of networks.

For example, if we adopt Powell’s definition of a networked form of organization as “typified by reciprocal patterns of communication and exchange” (Neither Market Nor Hierarchy, 1990), then it becomes apparent that they have conflated social networks with markets when describing the first of their three supposed principles underpinning the success of social networks. When illustrating the activity of a business sourcing raw materials, our opponent incorrectly identifies the utility-maximizing forum for this transaction as a social network, when this is clearly a market activity. The term “social network” is not a catchall. A market is a distinct organizational form, and is the most important “interface” for exchanges - like the purchase of a ton of bauxite - that are “straightforward, non-repetitive and require no transaction-specific investments” (Powell, Neither Market Nor Hierarchy, 1990: 297). Should a business have a need for a regular source of a particular commodity, certain possibilities like bulk discounting or fixed-price contracts might emerge that increase the attractiveness of engaging with firms to handle those arrangements, where firms are defined by Richardson (1972) as “islands of planned co-ordination in a sea of market relations.”

To take another example: consider a trip you are planning with your family. When contemplating the most appropriate platform for obtaining the best flight ticket price, are you more likely to get the best answer quickly by posting the inquiry on your Facebook wall, or would you engage a firm like Expedia?

The bottom line is that by failing to define the boundaries of social networks, our opponents have attributed far more activity to social networks than even the staunchest social network theorists would dare to. Social networks do not encompass all market-related activity. There are other distinct organizational forms, like markets and firms, which play an important and vital role in organizational success.

Another problem with the notion of social networks as drivers of organizational success concerns Powell’s observation that “each point of contact in a network can be a source of conflict.” Powell continues, “Parties to a network form of exchange lose some of their ability to dictate their own future and are increasingly dependent on the actions of others” (Neither Market Nor Hierarchy, 1990: 305). Our opponent assumes that a more connected and interdependent network is always a source of strength that propels organizations to success. But what happens when a point of contact in a highly interdependent network becomes a problem? The other nodes in that network are less able to react independently or buffer themselves from the consequences of that problem node’s actions.

This reminds us of the situation precipitating the collapse of the financial markets in 2008, when tightly intertwined investment banks were unable to disentangle themselves from one another as bad investments sank Lehman Brothers and Bear Stearns, bringing the world financial system to the precipice of disaster. Simply put, highly efficient and interdependent networks are susceptible to systemic risk. Which begs the question: Is a strong social network a fortress, or a house of cards? Moreover, the only way to prevent this systemic risk from manifesting is through deliberate actions to curtail the influence of networked forms of organization.

In conclusion, let us point out that we are not arguing against the notion that social networks matter for organizational success. Nevertheless, the burden was on our opponent to persuasively argue that social networks are the main driver for success by 2025, and we aren’t even sure what they mean by a social network. We also note that our opponent’s overall argument is so tenuous that they have been reduced to arguing that social networks do not always ensure success, but “only … increases the likelihood of success over what the situation would have been in their absence.” The resolution under debate is that social networks will be recognized as the “main driver” of organizational success by 2025, not that most of us will perhaps agree that they increase the likelihood of success. The opposition has failed to make a convincing case.