Social Network Effects on Productivity and Job Security: Evidence from the Adoption of a Social Networking Tool

Information System Research, Forthcoming

51 Pages Posted: 1 Nov 2012 Last revised: 28 May 2013

Lynn Wu

University of Pennsylvania - The Wharton School

Date Written: October 31, 2012

Abstract

By studying the change in employees’ network positions before and after the introduction of a social networking tool, I find that information-rich networks (low in cohesion and rich in structural holes), enabled by social media, have a positive effect on various work outcomes. Contrary to the notion that network positions are difficult to alter, I show that social media can induce a change in network structure, one from which individuals can derive economic benefits. In addition, I consider two intermediate mechanisms by which an information-rich network is theorized to improve work performance — information diversity and social communication — and quantify their effects on productivity and job security. Analysis shows that productivity, as measured by billable revenue, is more associated with information diversity than with social communication. However, the opposite is true for job security. Social communication is more correlated with reduced layoff risks than is information diversity. This, in turn, suggests that information-rich networks enabled through the use of social media can drive both work performance and job security, but that there is a tradeoff between engaging in social communication and gathering diverse information.

Keywords: Social Media, Social Network, Productivity, Job Security, Information Diversity, and Social Communication, Knowledge Management

Suggested Citation

Wu, Lynn, Social Network Effects on Productivity and Job Security: Evidence from the Adoption of a Social Networking Tool (October 31, 2012). Information System Research, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2169476 or http://dx.doi.org/10.2139/ssrn.2169476

Lynn Wu (Contact Author)

University of Pennsylvania - The Wharton School ( email )

3733 Spruce Street
Philadelphia, PA 19104-6374
United States

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