Processing Complexity in Networks: A Study of Informal Collaboration and its Effect on Organizational Success

Do organizations with more collaborative partners perform better than organizations with fewer partners? And is this relationship conditional on the ability of those partners to provide nonredundant resources from their network of contact with other actors? This article answers these questions with data describing the participation of governmental and nongovernmental organizations in the Cooperative Funding Initiative (CFI), a program sponsored by the one of the five water management districts in Florida. Results show a positive relationship between the inclusion of more partners in a project and the chances of getting funded, but also that once the project becomes too inclusive; those chances decrease if the partners fill more structural holes (e.g., provide more nonredundant resources). In other words, organizations perform better by adding more partners as long as this addition does not result in excessive complexity. These results are valuable for the growing community of policy scholars seeking to understand the specific conditions under which collaborative behavior positively affects organizational performance.