Thursday, November 03, 2005


Ok, I learned something interesting about connections in my OB class.
Connections, or contacts, can be classified in two main groups: Close contacts and Institutional contacts. Close contacts would be close friends and whatnot. Insitutional contacts are ones you can still use for jobs or whenever needed, but they aren't as close. The question is which are better, and how many, in what sort of mix, etc. etc.

Anyway, in class we came to the conclusion that it is best to have contacts in many different groups. In other words, to have a contact in investment banking, another one in law, another in medicine, etc. That way, you can use your banking contact for any banking needs you may have, or your law contact for any legal needs, without too many redundancies. Plus, if your legal contact needs some investment banking help you can be the middleman, which gives you that power and makes sure you're not a redundant member of some group, as in they need to turn to you, like so:

PEOPLE IN INVESTMENT BANKING <-----------> ME <--------------> PEOPLE IN LAW

(Those arrows mean they are connected. Ok nevermind)

However, then we learned about a study performed at the Pentagon where contact groups were analyzed, and they found that there was precisely this sort of relationship going on. There were higher up managers, lower managers, and one person who was seen as the go between and the person people turned to (As a sidenote, no one saw him as this, but after analyzing each person's group it became obvious that he was the so-called power-broker). So we decided that he must have had a lot of power. The interesting thing is, shortly after the study, he quit. And then the whole department pretty much fell apart. So so much for that.

The fact was, he was contacted to broker between the two groups continuously, and he couldn't take anymore of it so he quit.

So is it good to be a power-broker, a middleman, a go-between, or whatever you want to call it? The fact is, it gives a sense of power, and so many people assume that's what they want to be, but it may be much better to know someone else in that position, and let them worry about all this, as in:


Well, in conclusion, I think it can be good to be the middleman when dealing with close friends. When you do favors for close friends there's more of a chance they'll feel indebted towards you, or that they'll find a way of repaying you either way or allow you to benefit from their advantage. With institutional investors, however, it may be better not to be in that position. Say a TASIS grad sees I'm looking for a job and to show how much influence he has he lands me a good job. Chances are I'll send him a nice letter and maybe a bottle of wine, but I probably won't remember much about him 10 or 20 years down the line, when he may be in need.

I guess the secret is to keep close friends as they are, but to take advantage of the fact that others like to show how influential they are by using them as "middlemen". The trick is to find enough of these "middlemen" to have a pretty much exhaustive network, and to play on their egos whenever you need a favor done. Your payoff is the favor, while theirs is an ego-boost, and it seems to me you get the better deal by far.


PhD Wannabe said...

This prob. not related but MSN pops up in my mind while reading through your stuff. That's my social network! Kinda geeky and pathetic but it works. I have a friend who has a friend on msn who knows what I want to hear. So there, my social network expands faster with Microsoft. =D
And I need to read that blink book

Security Joe said...

good posting. that's why i use you as the middleman