The dark side of social relationships – the context of the video game industry

According to Bagozzi [2006, p. 457], “business-to-business relationships are not atomistic occurrences between distinct entities so much as they are mutual, social constructions whereby the parties to the relationship jointly commit themselves to satisfying commonly held goals.” Individuals’ role in business interaction is central, as is also shown by research into informal networks within formal organizational structures and interorganizational relationships [Marschan et al., 1996]. For instance, when entering an organization, people bring with them potential access to their social network, based on their personal history, family, friends, and education, and which has been called the “relationship sediment” [Axelsson and Agndal, 2000]. These contacts can be used for company purposes, providing the person is willing and able to use them. Ultimately, all business relationships are formed and developed in interactions between people [Halinen and Salmi, 2001], and part of these interactions are social relationships. In this paper, SRs are defined as “informal relations between individuals, characterized by a certain degree of emotionality” [Czernek-Marszałek et al ., 2023, p. 63].

Social relationships can cause not only positive, but also negative effects on business activity [Abosag et al., 2016]. A literature review of the negative consequences of SRs on business was made by Czernek-Marszałek [2020b], pointing out the following: lower innovativeness, lower adaptability, incurring alternative costs, limiting economic efficiency, negative phenomena, e.g., nepotism; high costs associated with the development, maintenance, and also breaking of strong ties; interpersonal conflicts (IC); and greater susceptibility to opportunistic activities. The characteristics of these negative effects are presented in Table 1.

With regard to some of the above-mentioned dark sides of SRs, an example of limiting economic efficiency may be a situation when too close personal relations between business partners ultimately hamper a person’s loyalty toward their own company. Then, decisions can be taken that are not optimal for business activity, but beneficial for the partner. Moreover, in some circumstances, close SRs lead to negative phenomena such as unethical business behavior giving rise, for example, to corruption [Salmi, 2000]. Personal contacts may function as a “door opener” in such a case. Moreover, they can also play a gatekeeper’s role, blocking the entrance to a new relationship, thus limiting adaptability and business innovativeness, or resulting in nepotism [Czernek-Marszałek, 2020a,b].

SRs may work as a “promoter” fostering the maintenance and development of a business relationship [Halinen and Salmi, 2001], as well as an “inhibitor” hindering its maintenance and development. If a person feels humiliated or treated unfairly, the ending of a business relationship is likely to cause long-lasting damage and costs. Such broken personal relationships may erode the very basis for business exchange, particularly if the service or product exchanged is strongly dependent on individual people [Halinen and Salmi, 2001] . Problems in personal relationships, or – as business people often formulate it – a mismatch in “personal chemistry” leading to IC – may have various negative consequences for business relationships [Uzzi, 1997; Tähtinen and Blois, 2011].

Weststar [2015, p. 1241] claims that VGDs are linked by a dense network of social relationships, which result in a “blurring of work and leisure whereby members [of the intra-industry occupational community] are close friends with other members of their occupation and/or the work permeates non-work life.” Indeed, as shown by Legault and Weststar [2012], nearly 60% of VGDs admit that they tend to socialize with other VGDs. This might be due to the primary role of creativity and individual innovativeness [Klimas and Czakon, 2018], which – in the case of the creative industries to which the VGI belongs [Lehtonen et al., 2020; Dubois and Weststar, 2022] – are significantly determined by social relationships [Clare, 2013].

Moreover, social relationships have been proven to be crucial for knowledge creation and sharing, including the exchanges of tacit knowledge and experiences [Chow and Chan, 2008] that are applied heavily in the context of R&D and new product-development activities in the high-tech industries [Allen et al., 2007] to which the VGI belongs [Zackariasson and Wilson, 2010]. The significant role of interpersonal relationships and intra-industry social embeddedness [Granovetter, 1985] results in VGDs possibly being seen as occupational communities [Weststar, 2015] or creativity-centric technological communities [Freeman and McNeese, 2019], and thus may be considered as prone to sharing beliefs, norms, values and social identity, but also to maintaining intense, strong and longitudinal informal relationships [Chow and Chan, 2008].

It is also worth noting that national video game industries, including VGDs, more often operate as gaming ecosystems, encompassing to the greatest extent technological and innovation ecosystems [Feijoó, 2012; Lehtonen et al., 2020; Klimas and Czakon, 2022]. These gaming ecosystems, as has been revealed in research on the Polish gaming innovation ecosystem, are built mainly on social connections [Klimas and Czakon, 2022].

Importantly, the social relationships exploited by VGDs are heterogeneous, taking into account the entities that are connected by them or the effects of the relationships themselves. These relationships may link VGDs with other VGDs [e.g., Johns, 2006; Klimas, 2018; Freeman and McNeese, 2019; Dubois and Weststar, 2022], but also with gamers [Burger-Helmchen and Cohendet, 2011; Marchand and Hennig-Thurau, 2013; Parmentier and Mangematin, 2014].

On the other hand, social relationships may bring various benefits [including intentional exploitation] such as value creation [Tschang, 2007], value co-creation [Davidovici-Nora, 2009; Zackariasson and Wilson, 2010], and co-innovations [Klimas and Czakon, 2022]. Nonetheless, alongside the positive effects of the social relationships of VGDs, the negative aspects are sometimes also signaled. One may point, for instance, to the tensions related to fair value capturing [Johns, 2006; Cennamo et al., 2016] or even value appropriation [Oh et al., 2015]. This reveals the interesting, but at the same time, rarely explored issue of the negative effects of social relationships in the VGI.

Our systematic literature review [Czernek-Marszałek et al., 2023] confirms the gap regarding the negative effects of the exploitation of social relationships in the creative industries, including SRs maintained by VGDs. However, given not only the broader context of the creative industries, but also the specificity of project- and team-based product-development processes, as well as the characteristics of the VGI, it is possible to consider several aspects of the potential negative influence of social relationships on VGDs.

It is an open secret that the VGI struggles with the significant problem of crunch [Cote and Harris, 2021, 2023]. It has been proven that working long hours, often with tight deadlines and high levels of stress, can lead to social isolation and strained relationships with family and friends [Peticca-Harris et al., 2015; Dubois and Weststar, 2022]. We claim that strong intra-industry SRs, recognizable in very different but dense communities of developers [Burger-Helmchen and Cohendet, 2011; Weststar, 2015; Freeman and McNeese, 2019] operating within gaming ecosystems [Feijoó, 2012; Klimas and Czakon, 2022], can lead to social and emotional engagement that may make it harder for VGDs to set clear boundaries regarding wellbeing and work–life balance. In addition, it may also deter protests against abuse or exhaustion and can increase the level of acceptance of crunch [Legault and Weststar, 2015; Larsson, 2018]. On the one hand, due to its high harmfulness, an increased level of acceptance of crunch may be seen as a negative implication of (primarily) superficial social relationships [Zaklan, 2023]. On the other hand, a higher level of crunch acceptance resulting in burnout, anxiety, and depression [Cote and Harris, 2023] may in turn have further negative implications for general social relationships, thus leading to decreased socialization [e.g., due to too high social pressure – Zaklan, 2023], withdrawal from friends and family, and conflicts in personal relationships in business and everyday life [van den Scott, 2014]. Also, these can further negatively affect business activity [Edholm et al., 2017; Larsson, 2018].

Social relationships, although intuitively linked to positive relationships such as friendship and positive emotions such as sympathy, enjoyment, fun, etc., may also involve negative emotions (e.g., anger, rage, disappointment, fury, etc.). We claim that VGDs coworking with people with whom they have this type of social relationship (i.e., embedded in negative emotions) can bear the consequences of inefficient teamwork [Scholl, 2018].

Firstly, poorer communication is due to the difficulty of expressing oneself in front of a person with whom one is in conflict. Indeed, personal conflicts and negative interpersonal relationships may lead to organizational conflicts and misunderstandings (i.e., a person is closed-minded, stubborn, and adversely affected), thus may lead to missed opportunities and poor team efficiency [Simons and Peterson, 2000].

Secondly, there are poorer time management and distraction issues due to delays in information exchange as people also avoid contact, finding it difficult to entirely focus on their work because they are plagued by negative emotions and anxiety. All of the above may lead to delays in GD [Petrillo et al., 2009].

Thirdly, when based on negative emotions, social relationships may reduce internal motivation, engagement, and job satisfaction and thus (again) lead to a reduction in efficiency and team and firm performance [Rezvani et al., 2019].

It should be emphasized, however, that the indicated negative effects of SR in the VGI were not the result of broader and in-depth research on this issue in this industry, but were only pointed out alongside other considerations; hence, research into them has been fragmentary so far.

Interviewees claimed that too strong SRs may cause a negative work atmosphere, which subsequently negatively affects the functioning of the entire company. Here they pointed out, firstly, that strong SRs foster IC, and secondly, that they foster unequal treatment of employees or generate accusations of favoring some at the expense of others. All of this, according to the interviewees, negatively affects the work atmosphere in the team and consequently the company as a whole.

In terms of ICs, these were identified in the research, especially among employees. It was indicated that resolving ICs takes a relatively long time and requires effort, which negatively affects the team. The interlocutors stressed that ICs, being a result of close SR, make employees focus on the negative emotions associated with such conflicts instead of productivity and creativity. Moreover, they stressed that SRs are so important in the industry that ICs can even lead to job burnout and the desire to change jobs:

Such conflicts can hit the smoothness of a project very hard because they cause a bit of a distraction from the goal of working on the project, and they sort of focus people around some negative emotions, it is known, especially in the creative industry, you need to keep a lot of peace of mind, because otherwise productivity and creativity suffer a lot. And it is productivity and creativity in our industry that require such, well, energy to maintain, that is, especially after a few years of experience, it is already a bit of a struggle with burnout, and you have to stimulate yourself very strongly in order to maintain such high motivation and high productivity, and such disruptions in relationships with people, with friends, with partners can be one of the reasons… one of the reasons, for example, for wanting to change jobs because we no longer like it, because we no longer have such nice relationships [G7].

In addition, it was also emphasized that when there is a strong social relationship between a supervisor and an employee, there may also be conflicts due to the inability of the team to interfere in such a relationship:

Well… here there are even examples, at least from us in the company, where there is a married couple in an employee relationship […] this can sometimes lead to additional conflicts like this. Because others may just think that because they know each other so well, well, outsiders don’t have a chance to sort of step into such a relationship [G7].

One of the interviewees said that due to the high negative impact of these conflicts on the team and the work atmosphere, there might even be a desire on the part of a supervisor to weaken this relationship in order to protect the team, which is the most important at work:

We might want to weaken that relationship if we know it’s hurting the rest of the team, as it were. If I’m responsible for the whole team and I know that I have a better relationship with someone this can be a problem for the whole team, because, after all, the well-being of the whole team should be more important than each individual in that team individually [G7].

The second element that negatively affects the team atmosphere and results from the maintenance of strong SRs in VGI was nepotism in supervisor–employee relations. Interviewees’ opinions referred to three main themes. First, bosses may be more lenient toward mistakes made by people with whom they have strong SRs or they may make decisions under the influence of and for the benefit of such people. Second, strong ties may lead to hiring acquaintances, which may not be supported by team members. Third, it may be that a higher salary is awarded to a person with whom a supervisor has a closer relationship than to others in the same position.

All of the above can have a very negative impact on the work atmosphere in the team:

This is quite dangerous. Because it is known that if we give too much sympathy to a person, we may just turn a blind eye to certain things that may be poorly perceived in this group. It is known that no one likes it if someone is favored, so this could, be a certain disturbance [G3].

If I like someone more, well, by the very nature of things, I’m inclined to give more to such a person, and you have to remind yourself from time to time that you sort of treat everyone fairly, although depending on how such people are able to use or manipulate it, well, there have been situations where someone… maybe not necessarily to me, but came with some kind of request, demand to his superior, who is a closer colleague and this superior treated this person much better than others, or someone… a new manager was hired from outside and this new manager also hired his friends from the previous company and gave them a much higher salary than the people already here in a similar position. So it’s a very big risk and I think it should be one of the priorities for the employer to avoid such situations [G7].

Interviewees indicated that due to the generally close, informal relationships that characterize relations among people from the VGI, an important and relatively frequent negative consequence of strong SRs in this industry is the departure of additional team members in the event of the dismissal or quitting of employees or supervisors who are liked. This results in quite high employee turnover, especially in large companies:

It often happens in large corporations that when the boss leaves, about half of the company leaves with him, or some large team does [G4].

The relative ease of reaching out to potential new employees with the aim of “hoovering” them up was cited as another negative consequence. Notably, it was argued that this is a peculiar feature of working in this industry, and it is difficult to avoid the occurrence of such situations:

The only perhaps negative effect that occurs, and one that cannot be prevented anyway, is that because we all know one another, a situation also sometimes occurs when someone takes an employee from one company to another. Colloquially speaking, he bribes them, but that is not exactly how it looks, of course. But such openness also results in the fact that, as it were, companies know more about each other and look at each other, and maybe sometimes it’s easier to be able to, I don’t know, take away an employee [D2].

Interviewees also indicated that a negative consequence of too strong SRs maintained in the VGI is the breakdown of business cooperation or dilemmas regarding its future. Here they pointed out that it is because of the frequent mixing of private and business relationships in the VGI that such cooperation often has to end or raises problems and dilemmas:

I would say, on the other hand, that sometimes it is more difficult. That is when there are very good relations, but unfortunately, cooperation for some reason doesn’t work out, well then there is a dilemma about what to do about it. And it happened to me several times. This is then also a double-edged sword, cooperation with someone like that [FR1].

Another theme pointed out by one of the interviewees during the FGI was that in the case of business cooperation with a person with whom a close relationship is maintained, many times, various types of contracts are not written because they are based on trust. Then, if for various reasons there is a need to terminate such cooperation, it becomes formally more complex and often involves additional costs:

I’ve encountered something like this, and of course, it was one of the more difficult situations I’ve had to resolve in the last three years, so indeed, private contacts are nice if everything goes according to plan and everyone is happy. But as it is, well contracts are always for bad times, so in general, these private contacts can also sometimes make it difficult to resolve certain situations that seem clear from at least a company management perspective [FR6].

Interviewees also mentioned the high (diverse) costs of building, maintaining, and breaking off SRs. This applied, for example, both to relations with employees and co-operators, the costs of participation in industry events, the organization of team-building trips, or attendance at conferences, where SR are built:

Interviewee: I mean, well, I think that here these various previously mentioned trips, this is a kind of cost incurred, sorry to maintain relationships, well, yes.

Researcher: Are we talking about industry conferences and trade fairs?

Interviewee: Well, yes, yes, because it’s obviously about knowledge exchange, of course, when it comes to business contacts, but also, well, some events you go just to meet with friends and talk to each other, all these elements come together. Also, well there is some actual cost that is incurred [G6].

At the same time, it was emphasized that people who miss these types of meetings lose a lot because they are isolated from the rest of the community, and thus are intentionally excluded from social interactions, which leads to social rejection and industry ostracism.

Interviewees also said that creating a community where members maintain close SRs, as is the case in the VGI, is costly, as it requires spending a lot of time and effort. According to the interlocuters, its time-consuming nature also requires determining which relationships are a priority and – through a very conscious approach, frequent conversations, building trust, etc. – striving for a situation where the benefits of strong SR will outweigh the costs:

Well, it’s not possible to have a relationship with literally everyone we will potentially have in our database. It’s just difficult, so it’s like I said, this prioritization is insanely important to learn so that you don’t get consumed by it for, I don’t know, two hundred hours a week, because you can’t embrace that [D1].

I think it requires a very conscious approach to make it work really well. A very high level of confidence and a very sober assessment of reality and skills. It’s extremely difficult. And I don’t think I know how to do it well. The ability to speak, to talk openly about difficult topics with people. Also then, you can keep most of the pluses and mitigate, as it were, the risks associated with the minuses. They will always be there, but it can be done, I think this is such an ideal community, in my opinion. At the same time, sometimes the cost of getting through to such a community is so high […]. We’re not going to try to do something like that. Because there are a lot of things that may not work out, may not succeed. Maybe something simpler. That’s OK too. I think we are trying to make an ideal community, so you can see that it’s difficult. [G1].

As a negative consequence of maintaining SRs with co-operators in the VGI, interviewees also emphasized the fear of costs associated with fighting for one’s own priorities in business cooperation, as well as the costs associated with this fight in the form of breaking off the relationship in the future [leading to potential negative domino effects]:

If such a business problem arises somewhere, and we have, let’s say, some such friendly company with which we have agreed on something and there is some kind of scuffle somewhere, let’s say that it is slightly more difficult to fight for one’s priorities then, knowing that they also have their priorities. Well, we wouldn’t want to spoil such a relationship either, including a business one. This can be a bit of a problem. But at the end of the day, we are adults, so we communicate, and it seems to me that if both sides are sincere and want to talk, then in the end, it is possible, somehow, to find some compromise [FR3].

Interlocutors also pointed out the difficulty of entering specific communities whose members have strong relationships. They cited the Warsaw gaming community as an example:

Well, that’s what Warsaw is. There is a community of a specific identity there, despite the fact that no one there is deliberately trying to isolate the rest of Poland from each other [laughs], but you feel, from the conversations of these people, listening to them, being there somewhere, well, you feel that there is a community stronger than the nation-wide one [FR5].

Referring to the costs associated with maintaining strong SRs in the VGI, interlocutors also spoke of the costs to the company and the costs incurred in their personal lives due to the disruption of their work–life balance:

I just had to limit my contacts with people here for the reason that my other relationships suffered because of this. Because if people are here all the time for a minimum of, let’s say, these eight hours, it’s usually more, they bond so strongly that it kind of transfers to life outside work. But you have to keep that balance somewhere so that you can have other relationships as well [G7].

A reduction in economic rationality and efficiency was mentioned as another cost of maintaining SRs in the VGI.

Firstly, focus was placed on the costs of reducing margins in transactions with friendly partners or choosing offers that are not necessarily optimal from an economic point of view. Thus, the company incurred some opportunity costs. At the same time, it is worth noting that in the end, however, it was considered as having positive results (referring to the long-term benefits of maintaining strong SR):

Yes, here, it can have a negative impact on turnover, on the profitability of the company. If these relationships are friendlier than actually, for example, the price, it may cause a slight reduction in margin, but I think further on, it comes out as a positive [R3].

Maybe even the offer that someone would do this port, I don’t know, faster, better, and that somewhere these personal considerations decide it, and not some cold calculation, so maybe here is the disadvantage right away. But sometimes we decide to work with an entity because we know someone there, or we have some connections, or we know how to work with them [FR4].

Secondly, a problem also seems to be the difficulty in making some decisions that are crucial from the point of view of the company, but at the same time, are inconvenient and unpleasant for the manager responsible for the firm. An example can be firing or admonishing employees who have close social relationships with the manager. However, as the interlocutors stressed, if these decisions were not made, the company’s economic efficiency would be negatively affected:

When firing, for example, if we have a very strong relationship. When it is good when we work, it helps, but when you have to part ways, it’s even more difficult. For example, this year I, and not just me, had to lay off quite a few people I really liked, with whom I would have been happy to continue working, but it just couldn’t be justified business-wise. And that has an impact on me for sure. For me it was more difficult, I stressed about it, I brooded over it to some extent, I had to work through it [G1].

It can be a problem when the other person with whom we have such a relationship does something wrong. He or she messes up his or her job, and then you have to separate the feelings from the merits, well then it doesn’t help […]. Good acquaintances, being colleagues versus problems, don’t always work. And you have to learn, however, to act in such conditions, to be able to say to someone that “listen, I really like you, we’ve known each other for 10 years and I can steal horses with you, but this is what I’m not able to do with you, because you’re doing it wrong,” and these are very difficult things to say [FR5].

Interlocutors also indicated that a problem is a lack of objectivity toward employees with whom the supervisor has a strong SR, which can also lead to ineffective or irrational actions. In addition, they argued that strong SRs sometimes lead to economic decisions in favor of friendly companies, which is not always optimal for the organization (the phenomenon of herding).

Reduction in a firm’s innovativeness was cited as another negative consequence of maintaining SR in the VGI. In this context, interviewees pointed to a reduction in the need for innovative activities when access to them was facilitated by contacts with a friendly entity. As a negative consequence of SR, they also mentioned adaptation to familiar partners resulting in lower adaptability and being closed to new relationships that provide new opportunities:

Researcher: And did you perceive that these relationships can limit, for example, innovative activities?

Interviewee: In a way, I think so, because if someone shows us a certain solution that he himself uses, we won’t think about how to reach the same solution with other ways, right? [G10].

I think it can happen, like in human relationships, that this repetitive nature of relationships can close our eyes to other potential relationships. And it’s also the case that perhaps some issue of being used to one person or one entity sometimes makes us miss other potential relationship possibilities [FR2].

The risk of disclosure of important and confidential information, which occurs relatively frequently in the VGI, if only in connection with events such as game launches, was cited as another group of negative consequences of strong SR. Such risks, according to interviewees, apply to relationships with various external entities. Interviewees admitted that due to close relationships, sometimes even by accident, some confidential information is passed on, which can lead to various types of speculation on the stock market in the future:

Some risks exist in the style of data leaking out by accident, that is, some betrayal of secrets, which is a certain theoretical risk […]. On the other hand, especially at the level of managers, we are in contact with those managers completely informally, sometimes we say certain things to each other […]. Someone will say that, for example, well, we have such problems in production now that, I don’t know, we don’t have enough people, well, you can infer, if they have not enough people, well, maybe they won’t be able to meet the deadline, and this is kind of a conclusion that can affect, I don’t know, speculation on the stock market, right [G7].

Opportunistic behavior was identified as the last group of negative consequences of maintaining close SRs in the VGI and can lead to losses due to overconfidence in a person with whom one maintains a strong SR. Informants also emphasized the difficulty of enforcing punishments against people who are overly trusted:

If someone has some bad intentions, well, based on such a trust that is kind of created by this relationship, he can try somewhere to weave his interests into it completely unnoticed and take advantage of this trust that was kind of built beforehand [G7].

When building a certain community in an industry or company, [you should] build it on certain pillars, and one of those pillars can be trust, for example. It can be excessive, and it can be reasonable. Because of overconfidence, I myself have such problems, certain problems or unpleasant situations can be born. This has to be taken into account, and one has to be aware of it. The problem is that when one of these pillars is trust, and this trust becomes excessive, it is very difficult to enforce some penalties, and consequences for something, [when] someone did something as a result of excessive trust […]. When we give someone a task to make a video or a character or design anything, and he, for example, does it for two weeks. And this overconfidence is such that we don’t verify it, we don’t monitor it, or we don’t ask him what his idea or concept is. And it turns out that he totally missed the point, and it doesn’t work, and it’s something we really needed because we’re two weeks behind […] [G8].

This type of negative consequence of maintaining strong SRs was considered relatively common in the VGI, a specific feature of which is precisely the maintenance of informal relationships based on trust.