Scandinavian Journal of Management, Vol 24, Issue 2, June 2008, pp145-161

Abstract(Summary)
Adopting a network-analytical approach this study tests predictions regarding the coexistence of formal organizational structures and informal networks. Data have been collected on the cooperative relationships within the strategic decision process at the two top-management levels in two German multinational corporations. The results from applying QAP and ANOVA analytical techniques reveal-against widespread assumptions-that managers participating in strategy-making not only use informal cooperation ties in addition to their formally designed relationships, but they also disregard their formal work contacts to a surprising extent. Moreover, significant differences can be found between horizontal and vertical relationships: (1) formal horizontal ties are much more likely to be disregarded than formal vertical ties, and (2) a significantly greater number of informal ties are built and maintained in a vertical rather than a horizontal direction. The results contribute to the existing literature in this field by  offering deeper insights into the interdependencies between formal structures and informal networks.