Leadership in a Crisis: A Social Network Perspective on Leader Brokerage Strategy, Intra-Organizational Communication Patterns, and Business Recovery

Abstract

Catastrophic events can significantly disrupt businesses and, as a result, understanding how organizations adapt to a crisis is critical. Undeniably, leaders often play a crucial role in times of great uncertainty. Yet, it is unclear exactly how leaders can effectively guide organizations through a crisis. Extending theories of network brokerage and organizational adaptation research, we posit that compared to leaders creating structural holes in intra-organizational communication networks, those leaders bridging structural holes can build more effective communication networks with greater cohesion and higher efficiency. In turn, greater cohesion and higher efficiency subsequently drive organizational adaptation and business recovery in a multi-unit enterprise during the early outbreak of COVID-19. Our hypotheses are supported using multi-wave network surveys in 111 chain restaurants with over 3,000 employees. We demonstrate that, during a crisis, leaders can serve as a key architect to shape communication patterns to facilitate organizational adaptation to crises and drive business recovery with faster customer growth and continually decreasing personnel costs.