This article reviews the framework of social network theory, then suggests that the reasonable governance mechanism and social structure is to balance dynamically between dense networks and sparse one, structural holes and closure, coupling and decoupling, and selforganization and hierarchy. Based on the indigenous social network view, as the “Differential Pattern” and “SituationCentered” are the traits of Chinese social behavior and network, we claim that “circle”(quanzi), “familiar ties” (favor exchange) and governance mechanism of selforganization is a key to understand the essence of Chinese indigenous management. In addition, this article, taking the theory of Harmony Management as an example, analyzes the consistency between the thoughts of indigenous management and the social network theory, and demonstrates that the social network analysis can provides a solid theoretical basis and powerful analytical tools for indigenous management in China.