"We knew that change wasn't going to be easy, but we didn't know how difficult it can be." So said an administrator recently whose organization was in the midst of a major restructuring. The lament is familiar. Change may be someone else's friend, but chances are it leads to unanticipated consequences when you try to introduce it into your own operation.

HBS associate professor Kathleen Valley and Tracy A. Thompson of the University of Washington, Tacoma, have identified an important reason for such a dilemma. They say that neither management theory nor practice has been a source of enlightenment as to how formal, management-imposed structures interact with the informal social structures that exist in every organization.

To fill this void, Valley and Thompson studied organizational change in the newsroom of a metropolitan daily, examining the interaction between formal and informal structures and how it affects the process and results of organizational change. Aware that the newsroom would be reorganizing from a traditional hierarchy into a team-based structure, they began their observations before the reorganization and followed the changes for the next fourteen months.

The results of their efforts have been reported in two recent papers. The first of these, "Sticky Ties and Bad Attitudes: Relational and Individual Bases of Resistance to Changes in Organizational Structure," examines how informal social structures contribute to employees' acceptance of and resistance to formal structural change in the workplace.

At the newspaper Valley and Thompson studied, management wanted to alter the way in which articles were developed and written in order to tailor the publication more closely to readers' interests. To accomplish this, it created "topic teams" organized around subjects and viewpoints believed to reflect those interests. In so doing, it also eliminated the traditional structure of "desks" or "beats" in which reporters, while answerable to their editors, were free to develop and write stories as they wished.

Given the traditionally individualistic culture of journalism, Valley and Thompson expected reporters to display a significant amount of resistance to the new team-based structure. They also suspected they would find resistance stemming from the informal network of social relationships that exist in any organizational unit. Valley and Thompson wanted to determine how reporters' places in the newsroom's informal social network, in combination with their initial individually held attitudes toward the organizational change, would influence their response to that change. (Individual attitudes are obviously a crucial factor in employee response to organizational change, Valley points out; yet previous studies of the subject have failed to account for the fact that "there is likely to be an interaction between individuals' attitudes and their social relationships.")

Outside Reading Valley and Thompson, "Sticky Ties and Bad Attitudes: Relational and Individual Bases of Resistance to Changes in Organizational Structure." In Power and Influence in Organizations, edited by Margaret A. Neale and Roderick Kramer. Sage Publications. Thompson and Valley, "Changing Formal and Informal Structure to Enhance Organizational Knowledge." Harvard Business School Working Paper 98-060.

To show how the interaction between the new formal structure and the informal social network actually played out after the reorganization, Valley says, "Assume I'm a reporter who has been told that instead of talking to any colleagues I want to about a story, as I've done in the past, I'm now supposed to confer with my teammates. A typical response is, 'I'll talk to the other members of my team -- especially if they're people I've always talked to anyway -- but you can't prevent me from going outside the team to run my ideas past the other individuals with whom I'm used to interacting.'" Such a reaction, Valley observes, constitutes a form of resistance to management's intentions -- although it was balanced by the extent to which reporters, as shown by the example above, also cooperated with the new structure.

Valley and Thompson have found a set of intriguing relationships among individuals' places in the social network, their initial attitudes toward structural change, and their eventual reactions to the new structure. "For example," Valley says, "if you look at the impact of informal relationships on people with bad initial attitudes, it turns out that having lots of prior bonds with people on your new team -- what we call 'greasy ties' -- eases the change process and helps overcome a negative attitude. In contrast, a history of strong social bonds to people outside one's new team -- what we refer to as 'sticky ties' -- exacerbates the negative effects of a bad attitude."

Since the ultimate test of the success or failure of organizational change is performance, Valley and Thompson also wanted to study the results of the organizational restructuring they observed and draw lessons from these outcomes. In their second paper, "Changing Formal and Informal Structure to Enhance Organizational Knowledge," they look at the relationship between team cohesion (a function of the interaction between the new team structure and reporters' informal social networks) in the reorganized newsroom and improvements in productivity and product quality.

Valley and Thompson postulated that knowledge, which is embodied in the products and performance of the teams, is developed and enhanced through teamwork. To explain the informal social structures through which team members achieved performance improvements, they distinguished between two types of interaction: "task-based," which is focused on the work at hand, and "friendship-based," in which people emotionally support one another as individuals. They then posited that high levels of task-based interaction would result in greater team productivity, while high levels of emotionally supportive behavior -- by fostering the kind of trust needed for group creativity -- would enhance the quality of a team's work.

Valley and Thompson's research clearly indicates that the more "task-based interaction" a team engaged in, the more articles it produced. Yet the expected relationship between "friendship-based interaction" and the quality of a team's work proved harder to establish. "Product quality did not increase for any of the teams," Valley says, "but we think this may be related less to people's interaction per se than to the fact that management kept changing team personnel. Our findings suggest that if you keep churning people through a new structure, you're going to prevent rather than encourage innovation."

What broader lessons can executives glean from this work? "Management seldom thinks about aligning new formal structures with existing informal social structures," Valley says. "But the latter are crucial for the achievement of an organization's goals. By understanding the systems of informal social relationships that people create for themselves within the firm, management can not only encourage people to accept change but help them work together in ways that enhance knowledge and performance." In today's business environment, no organization can do too much of that.

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