The Hidden Value of Internal Relationships: What Metcalfe's Law Teaches Us
There are days when, entering the company, you feel that something has changed. There hasn't been an earthquake, no dramatic press release. And yet, the air is different.
Maybe someone has left. A long-time colleague. Or maybe not, maybe a young person, one of the latest to join. But that's not the point. The point is that with that person, all the connections that made that person possible have also gone: the relationships, the exchanges, the informal bridges between departments.
Now, at that point a law comes into play that is not written in HR manuals, but should be included in every company board: Metcalfe's Law.
What is Metcalfe's Law (and what does it have to do with your business)
Robert Metcalfe, one of the pioneers of the Internet, formulated a principle as simple as it is disruptive:
“The value of a network is proportional to the square of the number of its nodes.”
In practice: if you have 5 people, you can generate 10 connections. But if you have 10, the potential connections increase to 45. You double the members, you multiply the relationships. And therefore the value.
In the company, those “nodes” are us: people who talk, write to each other, collaborate, trust, make things happen. The network is not just the organizational structure. It is the invisible fabric of human relationships.
What happens when you lose a node?
When someone leaves the company—voluntarily or by choice—you don't just lose a profile, a badge, an output. You lose all the connections that person made possible.
A real simulation:
- In a company of 1000 people there are approximately 499,500 possible connections.
- If 100 of them come out, and we move to 900, the number of connections drops to 404,550.
- The damage? Nearly 95,000 lost relationships.
Get the point? You didn't lose 100 people. You lost a piece of your nervous system. And if the people who leave were "central nodes," the impact can be devastating.
Downsizing, turnover, silences: the true cost of disconnection
Every unmanaged exit is a disconnection. And disconnection has an exponential cost:
- Fewer ideas that travel
- More unresolved conflicts
- Slower decision-making flows
- More silence where there was once collaboration
The biggest risk? The network fragments. And when networks break into isolated subnets, value doesn’t halve. It collapses.
Why You Need to Treat Relationships as Strategic Assets
Every person who works with you is an active node. The more relationships they have, the more value they bring. And the great thing is that you don't have to be a manager or senior to be central: even the colleague who connects two departments with a well-placed message can make a difference.
Internal relationships are capital. And like any capital, they must be cultivated.
What you can do, starting tomorrow
- Map connections, not just skills
Do you know who connects who? Who bridges departments? Who is the tie breaker in groups? - Manage exits with system view
When someone leaves, ask yourself: what connections did they take with them? How can you regenerate them? - Promote bridge building
Encourage cross-functional interactions, exchange moments, mixed task forces. Make sure that every node is also a connector. - Don't underestimate the invisible value
Often the most connective people are not the most “visible” in the hierarchy. But they are the ones who hold the pieces together.
Not just mathematics
Metcalfe's Law is mathematics, but also humanity. It reminds us that value is not only in the sum of individuals, but in the quality of their connections.
And in an age where everything is measured, perhaps we should also start measuring what holds companies together: relationships.
Because a living network is not worth what it produces. It is worth what it makes possible.
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