Practical Applications of Organisational Network Analysis

Organisation Network Analysis (ONA) has been a growing trend among companies over the last few years.

This is a field of HR Analytics that can help to provide valuable insights for companies, leading to returns that will justify the investment.

What are the practical applications of ONA? Let’s take a look:

What is organisational network analysis?

I’ve written previously about organisational network analysis (ONA), but here’s a quick refresher. ONA is a scientific methodology for visualising and analysing the formal and informal relationships within an organisation. In other words, you build a picture of how communication works in your organisation, who the key influencers are, how information is gathered and how decisions are made.

Deloitte provides an ONA description that looks at people within an organisation in terms of “nodes.” These are the different types of nodes they identify:

• Central node: These are the people who seem to know everyone. Central nodes share lots of information and influence groups quickly. Central nodes can be anywhere in the hierarchy of an organization, are often well-liked, and are highly engaged in company news and developments.
• Knowledge broker: These people create bridges between groups. Without knowledge brokers, information and idea sharing grinds to a halt.
• Peripheral: Easily overlooked and unconnected to the rest of the company, high-potential peripherals can be a risk to organizations. Exceptional Java coders who don’t teach others best practices not only stagnate product development, they are also easily convinced to take their talents elsewhere.
• Ties: Ties are the formal and informal relationships between nodes. Establishing optimal relational ties between central nodes and knowledge brokers helps ensure useful information moves easily between and within groups.

Why is this important? It gives you a valuable tool to evaluate how people operate within your organisation. You can learn things like who the leaders are (even among people who aren’t in a management position), or even who might be likely to leave. Organisations typically now look to be more agile than what traditional structures allowed and ONA provides a fresh lens through which to view that structure.

What organisations usually find is that their informal structures can be more influential than the organisational chart. These informal connections tend to form the lifeblood of the organisation.

Practical applications of ONA

Anything in HR analytics tends to involve building a business case first. With ONA, it is about identifying and improving HR practices in various ways that can benefit the company. Here are some examples:

Know your key influencers

ONA helps you to identify who the SMEs (subject matter experts), drivers of change and key influencers are within your organisation. Sometimes you will find that these people aren’t in leadership roles and may not even be part of key decisions. They’re often the people that will help drive any changes that are a result of those key decisions though.

When you can identify who these people are, you can ensure that they are designated appropriate roles or development programs. You can find ways to maximise their talents so that they and the business both benefit.

Make selection decisions

One thing that ONA tells you about people is the type and size of their own network. Hiring candidates can also get you connected with their own network, therefore it is valuable to organisations to find candidates with strong networks.

This goes for the people already within your organisation too. When you consider matching candidates with the right role, there is a good chance you will need some who are well-connected. 

Create innovative teams

ONA helps you to create teams that are likely to come up with more innovative solutions. General Motors provides a good ONA example of this. Their goal was to stimulate innovation from the inside of their company.

GM analysed the connections between their employees and discovered how to bring together the people most likely to have the highest impact on innovation and product design to work together on projects and teams. They then brought them together in environments designed to foster innovation. Those included:

• Co-Lab – an event running for a maximum of 24 hours involving up to 60 people competing in small teams who pitch ideas to executives. A Co-Lab operates on the premise that sometimes the best solutions emerge when you have the least time.
  
• Summit – up to 300 individuals acting as brokers and connectors from across functions, using design-thinking methods to share, create, and build solutions.
  
• Tipping Forward event, typically comprised of 100 to 200 individuals, which provides the adaptive space necessary to openly share the many successes that have already been applied locally, and then tap into the passion of energisers to amplify these successes across the broader enterprise.

Optimise office design

It’s well-known that the traditional cubicle design and separation of management from their teams can be very inefficient. ONA can help companies to design a better office space for the optimisation of their productivity.

BCG New York is a case study of this – here’s an extract from their press release on the subject:

“Prior to the move, BCG engaged a firm called Humanyze to capture employee interaction patterns and movements throughout existing workspaces. A group of volunteers wore sensors developed at the MIT Media Lab to quantify where people spent time and how they moved around, and to map the knowledge and influence network. The data was then analysed at an aggregate level to determine the “collision coefficient,” as Love calls it. In the coming weeks, the firm will do the same thing in the new office to analyse the shifts in time allocation and networks, which provide an objective view of how the space influences work culture, and to assess the improvement in organisational performance”. 

Identify attrition risks

Attrition is to be expected to some extent, but it can be very costly to organisations. Finding, selecting and training replacements takes investments of time and money, and sometimes, valuable knowledge gained from experience leaves with the employee.

ONA can help HR practitioners to identify those at risk of attrition. For example, identifying those whose engagement has dropped off or who have placed themselves at the outside of networks. Importantly, you can assess which attrition risks put the organisation at-risk of losing valuable knowledge or connections. 

This puts HR in the position of taking a proactive approach to potential attrition. Perhaps they take steps to retain the person, or if not, to ensure that their knowledge is passed on.

Measuring the effectiveness of managers

Microsoft wrote about an ONA initiative they held where they combined ONA with engagement and business data to better understand manager effectiveness. Head of People Analytics, Dawn Klinghoffer, summarised their findings in this article.

Their core findings on what makes a manager effective helped to solidify some factors that they had predicted, while introducing some they didn’t expect. These are summarised by the diagram shown below:

This sort of analysis can help companies to identify where they might need to invest in training and development for leaders.

Final thoughts

Organisational Network Analysis can bring several practical benefits to companies, particularly in efficiencies within HR processes.

ONA has been a growing trend among organisations, particularly as analytical ability has improved. I expect we will see many more examples over the coming years of companies finding innovative ways to use ONA.

This is a good business case for HR Analytics to run with. There are already several published case studies you can use to justify investment in ONA in your own organisation.