9/18/04 DRAFT, Page viii
This is a preprint from Brokerage and Closure, to be published by Oxford University Press in 2005. I
hope you find this a useful interim reference, but please honor the copyright, 2004 © Ronald S. Burt.
limited scale of yesterday's organizations is today inefficient. We removed layers of
bureaucracy and laid in fast, flexible communication systems.
Ask the leader of any large organization about the most difficult barriers he or
she has to manage to harvest the coordination potential of our communication
capabilities. They inevitably talk about people issues, culture issues. People
continue to work the way they learned in legacy organizations, in yesterday's
organization silos. We are capable of coordinating across scattered markets of
human endeavor. We are not yet competent in how to take advantage of the
capability.
In this period of competence trying to catch up with capability, authority in the
formal chain of command no longer provides the answers it once did. Matrix
structures have people reporting to multiple superiors, which weakens the authority
of each reporting relationship. Efficiencies gained by removing layers of
bureaucracy shift control from vertical chains of authority to horizontal peer pressure.
Work once defined by superiors in the formal organization is now negotiated
between colleagues who have no authority over one another. People are more than
ever the author of their jobs, not told what to do, so much as expected to figure it
out. Feeling that someone must be at fault, people blame one another for problems
created by the capability-competence gap. I do not wish to make too much of the
Fredericksburg analogy because it is only one of many such, but it is interesting to
hear Fredericksburg soldiers voice complaints I so often hear in contemporary
organizations: Officers in the field recognize the folly of attacking the Confederate
line and so hope there is no truth to the rumor of headquarters ordering an attack.
2
Staff officers blame failure on a "want of cooperation" in the organization.
3
Then as

2
My information on the Fredericksburg battle comes primarily from O'Reilly (2003) but internet
access to soldier letters and diaries was useful. Here is an excerpt from Union field-officer Josiah
Favill's diary five days before the attack: "We hear to-day that Burnside has made up his mind to
cross the river, and attack the rebel works. It hardly seems possible, as they are now fortified in the
most approved manner, and garrisoned by the best army the Confederacy has in the field. Whoever
undertakes it is sure to be beaten; therefore we hope the rumor may prove untrue."
3
Here is an excerpt from Union surgeon Alfred Castleman's diary after the attack: "Night has
come, and the firing has ceased. It has been a terrible day. The wounded have been sent in to us in
great numbers. I have been amputating and otherwise operating all day. The result of the battle I do
not know. The enemy is very strongly posted, and I exceedingly doubt our ability to dislodge him. In
my letter of the 10th, I prophesied that we would cross without much fighting; that when we crossed,
the enemy would contest every inch of ground, but that if Burnside was heartily sustained by his

9/18/04 DRAFT, Page xii
This is a preprint from Brokerage and Closure, to be published by Oxford University Press in 2005. I
hope you find this a useful interim reference, but please honor the copyright, 2004 © Ronald S. Burt.
managers because that is where I have found the highest quality data on the
informal networks that provide social capital.
5
In terms that will become clear across the chapters, here are the four stylized
facts around which the book is organized:
First, brokers do better. Informal relations form a small world of dense clusters
separated by structural holes and the people whose networks bridge the holes are
brokers rewarded for their integrative work, rewarded in the sense of more positive
individual and team evaluations, compensation higher than peers, and faster
promotion (Figure 1.8).
My second point is that a vision advantage is responsible for the brokerage
advantage. Information is more homogeneous within groups such that people who
bridge the holes between groups are more creative and more likely to see a way to
implement their ideas (Figure 2.3).
At the same time, network closure around the bridges creates reputation
pressures that encourage the trust and collaboration needed to deliver the value of
brokerage, so social capital can be defined in a general way in terms of closure
across structural holes (Figure 3.5).
Where closure exists it reinforces the existing network structure; slowing decay
and amplifying relations to extremes of trust and distrust, thereby deepening the

5
My focus on managers probably means more evidence of social capital. First, Carroll and Teo
(1996) use survey network data on a probability sample of Americans to show that manager networks
(relative to non-managers) involve more participation in voluntary associations, more core discussion
contacts, a larger proportion of contacts who are colleagues or co-workers, and more contacts who
are total strangers to one another. Second, managers have more job autonomy than non-managers
and social capital is more of an advantage for people who have more autonomy (see Section 3.3).
More evidence of social capital makes professionals and managers a productive research site for
studying social capital, but warrants a caution against generalizing to other populations. The caution
should not be taken too far. Business students sometimes ask whether social capital is irrelevant to
their small organization because every one knows one another within the organization and key
contacts are outside -- so closure is complete allowing no brokerage. I do not wish to make too much
of this because the response is obvious, but it deserves mention in a footnote. It is true that social
capital evidence comes disproportionately from large organizations (research sites often number
employees in the thousands while the median organization in which Americans work contains 50 full-
time employees and 2 part-time people operating on an annual budget of $3 million; Kalleberg,
Knoke, Marsden and Spaeth, 1996:49). However, managers in all settings have contacts in their
immediate workgroup along with contacts in the rest of the world. In a large organization, the rest of
the world is typically elsewhere in the same firm. In a small organization, the rest of the world is the
external environment of suppliers, competitors, and customers. In either situation (anticipating the
structural autonomy model in Figure 3.5), closure is productive within the workgroup combined with
brokerage beyond the workgroup.