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Social Networks, Exploration, and Exploitation in Multi-Tier Hierarchical Organizations Experiencing Environmental Turbulence
North American Association for Computational Social and Organizational Science (NAACSOS) Conference (2007)
  • David A. Bray, National Defense University
  • Michael Prietula, Emory University
Abstract

James G. March conceived organizational learning as a balance between the exploration of new alternatives and the exploitation of existing competencies in an organization. This study extends earlier work by employing a computational simulation to evaluate the effect of additional tiers in a hierarchical organization; specifically regarding March's original constructs of exploration, exploitation, personnel turnover, and environmental turbulence. Next, the study evaluates the effects of homogenous and heterogeneous social networks within two independent multi-tier hierarchical organizations. This study reaches four major findings. (1) Increasing exploitation has negative consequences for multi-tier organizations, but not for flat organizations. (2) Homogenous social networks help an organization stabilize itself when confronted with environmental turbulence. (3) If overused, a strategy of social networks can preclude the benefits offered by increased positive effects of exploitation and personnel turnover. (4) As an organization increases its number of tiers, the cumulative effect of heterogeneous social networks is more beneficial statistically. Cumulative findings have strategic relevance for organizational theory and future empirical studies.

Keywords
  • organizational learning,
  • exploration,
  • exploitation,
  • personnel turnover,
  • environmental turbulence,
  • hierarchical organizations,
  • social networks,
  • simulation
Publication Date
June, 2007
Citation Information
David A. Bray and Michael Prietula. "Social Networks, Exploration, and Exploitation in Multi-Tier Hierarchical Organizations Experiencing Environmental Turbulence" North American Association for Computational Social and Organizational Science (NAACSOS) Conference (2007)
Available at: http://works.bepress.com/dbray/15/