Knowledge asymmetry and brokerage: linking network perception to position in structural holes

Hahl, O, Kacperczyk, O and Davis, J P (2016) Knowledge asymmetry and brokerage: linking network perception to position in structural holes. Strategic Organization, 14 (2). pp. 118-143. ISSN 1476-1270

Abstract

Although brokers who span structural holes have been shown to occupy a valuable position in organizations, emerging research suggests that the returns to these brokers can vary depending on whether alters can credibly threaten to disintermediate the broker and close the structural hole. Yet, the factors that shape the likelihood of disintermediation have not been extensively explored. In this article, we build from the premise that an alter’s knowledge about the structural hole is a necessary condition for disintermediation. Without this knowledge, the alter will not know with whom to disintermediate. Drawing on research about cognitive social structures, we argue that individuals are most likely to be in a structural hole under the condition of knowledge asymmetry—that is, when brokers know about the structural hole, but alters do not—which reduces the likelihood of disintermediation by alters and increases the benefits for brokers. Using advice network data from a high-tech organization, we find evidence of knowledge asymmetry in existing structural holes, and moderation of this relationship by two factors also related to disintermediation: (1) broker’s reputation and (2) alter’s position as a provider (vs. acquirer) of resources. We also show that knowledge asymmetry is related to higher returns for brokers. The broader theoretical contribution is a better understanding of how network perceptions are related to positions across structural holes, an important structure from which power is derived in organizations and markets.