General Introduction

An Introduction to Networks

"Networking" is the buzz word of our times, networks are all around us. Networks are the key to our life – virtually anything is connected with something other: Persons, corporations and their share holders, our private and public life. Any structure that emerges from the mutual ties of its components may be conceived as a network.

The very purpose of network analysis – and Network Monitor in particular – is to make these networks visible, to unveil the hidden structures, which are slumbering below the surface of our everyday life.

With this little primer we want to introduce to you some important key terms, which will help you to use Network Monitor.

Ties and Distances in a Network

Network Monitor Austria shows the network of the key players of Austria's industries. This network is formed by the managers and members of the board of the top corporations and their institutional relations to the boards and executive offices of competitive and befriended firms. This way corporations become linked together by their interlocking managers and persons become connected by these affiliations.

The path from a corporation (or affiliation) to another is made up of persons, the ties between persons are made up of affiliations. These step-stones of mutual relations are known as steps:

Distances in a network

This illustration gives you a cut detail of the relations of a fictive person:

Influence and Proximity in Networks

By these relations persons and affiliations are more or less tightly integrated into the networks.
Are any persons sharing relations to the same affiliation, they also have something in common. They have common "friends" in these corporations (and by this also common friends of friends). Their mutual influence grows as they share more, but also they become more and more dependent upon each other: They have to get along.

This way the proximity between some players grow, while others become comparatively isolated:

Verflechtungen und Einfluss im Netzwerk

The illustration depicts the network of five players, of whom four of them (A, B, C, D) are linked by shared relations (via corporations 2 and 3).
B and C are also linked by another shared relation (via corporation 4, but we will leave this out further in order to simplify things).
The lines of influence made up by this are depicted as red triangles.

Corporations 2 and 3 are said to be bridgers to players A, B, and C as they are establishing their shared relations.
Vice versa players A, B, and C are bridgers to corporations 2 and 3.

Player E is left quite isolated from this sub-network, but he's also linked to it by player A (via corporation 1), who may broker informations forth an back.

Due to these varying densities of relations some of the actors gain weight of influence: They become ambassadors, who are brokering between the various parts of the network, they are more tightly integrated, have more influence than others. — Integration is a fine thing, but there are times when it's not the best thing to be integrated to closely: Are all of your friends also your friends' friends, you become more and more dependent on them as they form a clique. On the other hand, as you reach into different parts of the network, you may come up with new ideas and opportunities ...

To get a grasp on these various proximities, weights of influence, and opportunities network analysis has developed some elaborate scales and measures – so called network indices – to express these qualities.

You will find these indices, as they have been specially prepared by FAS.research, in the report on the individual players (persons as well as affiliations) alongside with benchmarks and graphical representations.

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