"People who have contacts in separate groups have a competitive advantage because we live in a system of bureaucracies, and bureaucracies create walls," says Burt. "Individual managers with entrepreneurial networks move information faster, are highly mobile relative to bureaucracy, and create solutions better adapted to the needs of the organization."
His research goes a long way toward answering that persistently nagging question: Is it what you know or who you know that leads to success? For Burt, it's both. Who you know determines how effectively you can apply what you know. Getting things done, and climbing the walls of your company, require having the right relationships.
I've always been well aware of this idea. At Deloitte, I got to know the CMOs of our largest competition. At Starwood, I quickly became familiar with the industry influencers. When I became CEO of YaYa, I set out to meet the leadership in the media and computer games industry. What I didn't realize was that all along I was setting the groundwork for the success of FerrazziGreenlight at the same time. No matter what the job, if I was going to push my company's product into an important brand position among those who mattered, I needed to be able to converse with the players inside and outside the industry who could help me make that happen. One of the ways I achieved this was by helping them get to know one another—which they, too, knew was beneficial for their business. I was surprised, for instance, that the heads of marketing for the big consulting firms didn't know one another.
Maybe you're thinking to yourself, "But I don't know any executives or key people in my industry! And why would they want to get to know me anyway?" Not a problem. Performing social arbitrage when your financial and relational resources are thin is actually not too big a hurdle. The solution is knowledge, one of the most valuable currencies in social arbitrage. Knowledge is free—it can be found in books, in articles, on the Internet, pretty much everywhere, and it's precious to everyone.
The ability to distribute knowledge in a network is a fairly easy skill to learn. So easy, in fact, you should get started today. Identify some of the leading thinkers and writers in your industry. Do these figures have any new books on the market? Look at what's hot on the nonfiction New York Times bestseller list. Or for business bestsellers, check out the Wall Street Journal's list in the Personal Journal section on Friday. Buy the book, read it, and take some notes summarizing the Big Idea, a few of its interesting studies or anecdotes, and why it's relevant to the people you're thinking about passing your knowledge on to. You've just created your own Big Idea of the Month Cliffs Notes (or whatever snazzy title you choose). Now pick a few people, some whom you know well and some you don't, and e-mail them your work. All you have to say is "Here are some cool ideas I think you'd like to be on top of."
Presto! You're now a knowledge broker. After you get the swing of it, you might want to send out a monthly Big Idea Cliffs Notes e-mail. Turn it into a newsletter. If one month you don't have the time, you could forward some particularly helpful article you read. Or, if the book is particularly interesting and you really want to make an impression, send the book itself.
It's easy enough to make knowledge brokering a habit. Let's say, for instance, someone mentions over lunch or in the minutes before the start of a meeting that they are having a hard time dealing with their teenage son or daughter. You should hear "problem." As a practitioner of social arbitrage, you think "need to find a solution." If you don't have any personal advice, the solution will come from asking yourself, "How can my network of friends and contacts help? Which one of my friends has teenagers?" It probably won't take long before you come up with someone you know, maybe your own parents, who handled their own teenage kids in a constructive manner. Get on the phone and ask them if they have any advice, or if they used any books or articles to help them through the process. Now pass it on.
Or let's say you're a real estate agent but you aspire to be a clothing designer. I don't know too much about clothes, but as with just about any subject, I'm sure others do (one of those people has almost certainly written a book about it). Do a search on Amazon.com, and find something that seems helpful to someone looking to become a clothing designer. Then send the aspiring clothing designer a link or even the book itself, or broker a direct conversation—that would be real value.
Yes, this kind of reaching out takes time and a certain thoughtfulness. But that is exactly why it's so appreciated. Facilitating all those connections, all that knowledge, and ultimately all that happiness is what being a truly modern-day "power broker" is all about.
To paraphrase Dale Carnegie: You can be more successful in two months by becoming really interested in other people's success than you can in two years trying to get other people interested in your own success.
Vernon Jordan, dealmaker extraordinaire, former Clinton advisor, and Washington super-lawyer, currently sits on ten corporate boards, including American Express, Dow Jones, Revlon, and Xerox. He's the Senior M a n a g i n g Director for Lazard, an international investment bank, and also a high-ranked senior counsel at the Washington, D.C., law firm of Akin Gump. Fortune ranked him ninth on its list of the most powerful black executives.
According to Time magazine, Jordan earns a seven-figure income from a " l a w practice that requires him to file no brief and visit no courtroom, because his billable hours tend to be logged in posh restaurants, on cellular phones . . . making a deft introduction here, nudging a legislative position there, ironing out an indelicate situation before it makes the papers." He doesn't just talk a good game. He makes things happen.
It's hard enough, in this life, to hold down just one job in a highpowered organization. But Jordan has made himself so valuable—so coveted—to so many employers that he actually works for several at once—and none of them seem to mind his vocational polygamy.
Along the way, Jordan has become one of Washington's most networked individuals, a man w h o seems to have friends and influence in every quarter and province. He's connected Lou Gerstner with IBM. He approached Colin Powell about replacing Warren Christopher as Secretary of State. He helped James Wolfensohn become President of the World Bank.
How has he done it?
Jordan has used social arbitrage to make himself indispensable—he is, in every sense of the w o r d , a modern-day power broker. But he wasn't always at the vortex of everything that happens in Washington. He didn't even live full-time in Washington until Akin Gump hired him in 1 9 8 2 . By the time he arrived there, he'd done enough in his career—having built up several decades of contacts made and favors done—to know that, before long, he'd become a man of influence in his new town. Akin Gump knew it too, which is one reason they hired him: "I knew he would fit into the Washington legal community and come to be a dominant figure in it," said Robert Strauss, a senior partner. "This is a town built on the use of power and on relationships, and Vernon is about as good a people person as I know."
Jordan became a household name to all Americans in the 1 990s because of his relationship with Bill Clinton. But long before then, Jordan was well known to the black community.