Formal organizational networks can be complicated, including hundreds of people and several levels. The chain rigidly follows the formal chain of command; this network approximates the communication channels you might find in a rigid three-level organization. The wheel relies on a central figure to act as the conduit for all group communication; it simulates the communication network you might find on a team with a strong leader.

The all-channel network permits group members to actively communicate with each other; it’s most often characterized by self-managed teams, in which group members are free to contribute and no single person takes on a leadership role. Many organizations today like to consider themselves all-channel, meaning that anyone can communicate with anyone (but sometimes they shouldn’t). The structure of the wheel facilitates the emergence of a leader, the all-channel network is best if you desire high member satisfaction, and the chain is best if accuracy is most important.

The effectiveness of each network is determined by the dependent variable that concerns you.