Network science is a rapidly evolving field that has come into its own during the first two decades of the 21st century. It explores how connections shape and influence individuals, organizations and society. From computer and neural networks to social and communication systems, networks are ubiquitous.
For today’s leaders, understanding the dynamics of networks offers a crucial framework to navigate the complex and increasingly interconnected world we live in.
At its core, a network consists of nodes—individual entities such as people in a social network—as well as the connections between them. It is the flow of information, energy or resources which travel through these connections.
The emerging science of networks conveys a profound yet simple message for leaders: focus on the spaces between people. These are the spaces where relationships form, influence spreads and collaboration thrives.
The research of renowned scientists Christakis and Fowler on social networks illustrates this point. They observed that military recruits, even when part of a larger battalion, often train in small, tightly connected groups of 8–10 individuals. This structure fosters a culture of mutual reliance, trust and open communication. In this space, the actions of each individual have a direct impact on the group’s success. The result? Their personal bonds (i.e., connections) are so strong that soldiers are willing to fight and die for one another.
This example highlights the importance of improving the flows within a network. Flows are the way in which information, energy and influence move between individuals. In today’s interconnected world, effective leadership hinges on cultivating strong connections and enabling flows that fuel organizational success.
Here are five key strategies for leaders to apply these insights from network science:
1. Enhance flows at the node level. To improve the flows within a network, leaders must focus on strengthening the social-emotional competence of individuals. Building deeper relationships, fostering awe and cultivating curiosity can elevate the quality of these flows. Awe helps individuals recognize what they don’t know, sparks curiosity and the desire to connect more profoundly with people and ideas.
2. Capitalize on the power of small teams. Research consistently shows that small teams outperform larger ones. Groups of four to five people foster stronger relationships, faster communication and greater trust. This creates an ideal environment for collaboration and agility. Leaders should prioritize the formation of small, tightly knit teams to enable higher performance.
3. Recognize purpose as the most powerful “pull” force. A compelling, shared purpose provides clarity, motivation and meaning for individuals within a network. Purpose resonates throughout an organization, energizes individuals and creates a collective focus that drives action and resilience. Leaders should anchor their networks to a clear, motivating purpose that galvanizes everyone throughout the organization.
4. Use engagement catalyst questions to activate purpose. To bring purpose to life, leaders should ask open-ended, engagement catalyst questions which are connected to realizing the organization’s purpose. These questions provoke reflection, spark dialogue and ignite proactive behavior. Engagement catalyst questions help translate purpose into tangible actions that energize an organization’s entire network.
5. Promote self-organization. Self-organization emerges when control is decentralized, and feedback loops enable adaptability. A strong shared purpose sets the conditions for systems to organize themselves. This in turn fosters innovation and responsiveness without external intervention. Leaders should create environments that empower teams to self-organize and drive innovation.
A Case in Point: The Transformation of General Electric Appliances
General Electric Appliances (GEA), once a dominant brand in the United States, experienced a slow decline in the 2000s. GEA’s products were no longer perceived as state-of-the-art, which led to a steady loss of market share. By 2015, GEA was poised to fall to 5th place in the U.S. appliance market.
Fast forward to 2022. GEA had achieved remarkable growth. Between 2016 and 2022, GEA saw double-digit growth rates year after year. Revenues soared from $5.9 billion to $11.3 billion and GEA regained its position as the top appliance brand in North America.
Two key achievements particularly stand out:
- Product Innovation: GEA introduced 2,800 new products—25 percent of which expanded into new product categories.
- Employee Satisfaction: GEA experienced a 76 percent employee satisfaction rate—far above industry and national standards. For three consecutive years (2022-2024) in a row, GEA has been certified as a Great Place to Work.
What changed?
GEA embraced Network Leadership principles and transformed itself into a network organization.
More specifically, GEA reorganized into small, semi-autonomous teams called “microenterprises.” Each microenterprise typically consists of fewer than 10 people. They are empowered to make decisions about resource allocation, product development and customer relationships. Employees are compensated based on the value they created for customers, rather than receiving fixed salaries.
Additionally, GEA redefined its purpose. It shifted from merely being a manufacturer of appliances to an aspirational purpose to become “the leading home ecosystem company.” This brand-new purpose inspires its microenterprises and provides a clear guiding light for their on-going work.
In an interconnected world, effective leadership depends on mastering the dynamics of networks. This entails strengthening connections, enhancing flows and creating environments where collaboration and innovation can thrive. Leaders who recognize the power of networks and cultivate these connections will unlock the full potential of their companies. By implementing the principles of Network Leadership, organizations will be ready to positively engage with persistent complexity and continuous future disruption.
