This is the first of a four-part study, funded by the National Institute of Education for the purpose of examining the function of informal social networks in school community relations in Pontiac, Michigan, from 1971 to 1981. This volume of the report (1) discusses the theoretical foundations of the study; (2) defends the validity of network analysis as a method for studying the turbulent and complex environment of the school system and the community; (3) explores the issue of trust, both in data collection and in complex social networks; (4) describes the principle of "recipes," regular patterns of action and interaction that can be determined by placing study subjects' statements within the overall social context being examined; and (5) reviews the social science literature on the utility of network analysis, the utility and effects of social networks, and the characteristics that make networks useful. (GC)