Network services can make organisations more efficient. But they also change the way employees communicate, as proven by doctoral student Binh Phan at BI.

Through the last 20 years we have seen many new network services within telecommunications and digital and social media. The new, network-based services impact how we communicate, who we communicate with and when we communicate.

The new services have made cross-border communication easier and less expensive. Innovation of network services has also brought richer content.

Both organisations and individuals are linked through networks of relations. The advantages we can achieve through the networks depend, in part, on how many are using the services and how the users are linked.

In his doctoral project at the BI Norwegian Business School, Binh Phan has looked at what advantages users receive when utilising new network services.

SMS in Thailand

In the first part of the study, Phan conducted a study among 111 mobile telephone users in Thailand who used SMS services (texting service). They were followed through three periods, each with a duration of more than two months, in 2010.

The BI researcher found that the value that users derive from the new service depends on what network they had before starting to use the SMS service. The services impact people in different ways.

This has practical significance for how suppliers of network services split up (segment) the market. It is not sufficient to look at demographic characteristics and offer services with many attractive new options. It will be key to find out how new services create value for users. This can vary between the users depending on what network they are part of.

“It is important to map the users’ existing network structure. Find out which problems the users have. Focus on how new services can solve these projects,” says Phan.

More interaction between employees

Binh Phan conducted the second part of the study in a selection of 245 Norwegian companies that were utilising new broadband services in their business activity. The researcher found, perhaps not surprisingly, that the new network service allows the organisations to solve their tasks more efficiently.

In addition to direct effects on the organisation’s efficiency, the new broadband services change the way the employees in the organisation communicate and interact.

“The services enable employees to communicate directly with each other across the formal organisation chart. Employees can also communicate with several people simultaneously. Managers can also communicate more efficiently,” says Phan.

The result is organisations with a flatter communication structure. This helps make the organisation more flexible, according to the strategy researcher.

Some managers might not appreciate communication across formal structures?

“Managers must risk losing a little control. The organisation achieves the greatest rewards when it is open to direct communication with those closest to solving the concrete challenges,” Phan concludes.

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