While I was researching my book about middlemen, some people didn’t seem to understand who I was talking about. “You mean like middle managers?” they’d ask. I used to say, “No — it’s about brokers, agents, dealers, and two-sided markets like Airbnb, OpenTable, and TaskRabbit.” In other words, I was investigating the people who connect buyers and sellers in an open marketplace, not in a firm.
But at some point in my reporting, as I learned more and more about the qualities shared by effective middlemen from all industries, it dawned on me that middle managers — indeed, managers and professionals at every level — obviously are middlemen. As the venture capitalist Mike Maples, Jr. put it to me, “middlemen connect nodes in a network to increase the value of the network.” And in an increasingly connected world, that makes all of us into at least potential middlemen, subject to the same perils and opportunities.
And yet even the term “middleman” conjures up a negative image — someone who creates costs and slows things down, a meddling intermediary. The truth is almost the opposite: by specializing (in middleman skillsets), middlemen can usually make things happen more efficiently than those who specialize in other job functions. (Ever tally the hours you spent planning your last trip abroad if you didn’t use a travel agent to cut through the research?) In other words, we face transaction costs, and middlemen can help reduce those costs. If you can reduce transaction costs for someone else, you can be a valuable middleman. The middlemen I studied did so in several key ways, three of which can be used effectively by middle managers and professionals as well:
Look for gaps between the silos; that’s where the opportunity is. An all-too-familiar feature of large organizations, silos are an unfortunate byproduct of each department specializing in what it’s good at. As valuable information gets trapped in each silo, the whole organization can become less valuable than the sum of its parts. But such gaps between groups are opportunities for would-be middlemen, those people who can bridge the gaps—the “structural holes” in the social fabric, as the University of Chicago sociologist Ron Burt calls them. People who speak the language of both sides, understand the needs and resources of each, and can ferry the right resources across the gaps at just the right time can profit their organization and themselves. These “Bridges,” as I call them, don’t have to have formal authority — they become recognized as leaders by acting like leaders.
But to be effective, they can’t be seen as a drain on either side, which means they must provide immediate value. All professional middlemen do some version of giving before they take, whether they be appliance flippers on Craigslist or operate two-sided markets like Airbnb. The same is true in a corporation: if you manage Customer Support and are trying to share what you know with Sales or Product Development, you’ll be much more likely to gain their attention and trust if you already understand their problems and can offer ready solutions without imposing on their busy schedules. Interlopers, in contrast, are resented in part because they haven’t earned the buy-in of other groups before asking of those groups’ time.
Keep both sides honest. Across a wide range of situations, the middleman’s power comes from the unique ability of the person in the middle to keep one or both sides accountable. This is because middlemen’s repeated dealings give them both more information about the past and more clout over the future.
For an example, think of a wedding planner. The client (the bride) has limited experience in planning weddings, while the vendors (DJs, florists, and so on) are only focused on their piece of the event. The wedding planner can get better service from florists and DJs than brides can on their own because she’s dealt with the vendors before, she knows what questions to ask, and, crucially, she is in a position to channel future business their way; vendors appreciate a good wedding planner, as well, because she can protect them from last-minute or unfeasible requests from the bride.
The same is true of managers and professionals: If you’re a doctor referring to patients to a specialist, you know far more about the specialist’s qualities than your patients do; what’s more, being in a position to make or withhold future referrals can keep those specialists in line — but only if you actually use your unique vantage point to see how things go, and use that information for the benefit of your future patients. You don’t have full control over the outcomes, but whether you’re a doctor or a lawyer or a manager, the quality of the work done by people you hire or recommend reflects on you, so you must accept responsibility for them.
Be a single point of contact for your team. The prevalence of email and social media has made it easy for anyone to communicate with anyone else, and search engines have put untold amounts of data at our fingertips. But all this direct access to people and information takes a toll: the more information we acquire, the more time it takes to process it.
Middlemen can help with information overload. Just as literary agents can cut through the slush pile, and a travel agent specializing in your destination can save you time in planning a complex itinerary, a manager can serve her staff by separating the signal from the noise, interpreting messages in light of the group’s mission, and deciding which requests warrant her group’s attention. So although total openness seems like an admirable goal, being a careful filter makes you a more valuable middleman than being a passive conduit. The caveat: your decisions of what to withhold must clearly be in the best interest of your team, or you risk appearing like a self-serving hoarder of valuable information.
An effective middleman can serve as a powerful enforcer of good behavior, a solid bridge across cultural divides, and several other indispensable roles. But playing these roles requires understanding the role and taking appropriate action, not just standing in the middle or, worse, being a drag on the system like a third wheel. Nobody likes a middleman — unless the middleman enlarges the size of the pie and takes only a thin slice.
About the Author
Marina Krakovsky writes and speaks about the practical wisdom of the social sciences. Her most recent book is The Middleman Economy: How Brokers, Agents, Dealers, and Everyday Matchmakers Create Value and Profit (Palgrave Macmillan, 2015).
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