Out-Group-Tie Centralization and the Performance of Work Groups

Organizations increasingly rely on group-based organizational structures to manage uncertain environments. However, at the group level there is still a limited understanding of how boundary-spanning activities should be managed to increase group performance. In this paper, we propose “out-grouptie centralization” as a concept that refers to the variation in the group members’ network ties to other social actors who are not members of the group itself. When the out-group-tie centralization is low, no group member enjoys substantially more ties to other social actors outside the group than does any other group member. A panel analysis with 120 work groups from a mediumsize German bank over a 12-month period reveals a reversed u-shaped relationship between out-group-tie centralization and group performance. However, the results indicate no association between the density of a work group communication network and that group’s performance.