We talk a lot about the importance of social capital here at Give and Take. But what do we mean by it?
Social capital refers to the cooperative and productive benefits we get from our social relationships and networks. We can build social capital anywhere we have networks–among friends, within your neighborhood, within a business community, or anywhere else.
Another definition comes from Harvard Business School: “Social capital focuses on the social networks that exist between us (literally who knows whom) and the character of those networks, the strength of the ties, and the extent to which those networks foster trust and reciprocity.”
Social capital in the workplace has incredible benefits both for companies and for their employees. There’s lots of academic research proving these benefits, but it all comes down to this: it’s crucial that we treat social capital as a valuable resource at work.
From the employee perspective, improving social capital has the following four benefits:
- Boost your career: By offering help or advice to colleagues without expecting anything in return (and by being willing to ask for help when you need it), you’re increasing your colleagues’ trust in you while cementing your reputation as an active and valuable contributor. Moreover, according to Wharton professor Adam Grant, corporate “givers” (the people who give freely to benefit others rather than because they expect something in return) are ultimately the highest performers and the most successful.
- Get smarter: If you’re helping other people, they will be more willing to help you without a second thought. None of us can go it alone, and we all do better when we can get an answer, some advice, a different perspective, or an introduction to help us with whatever we’re working on.
- Be happier and healthier: Research shows that developing and building work networks leads to happiness, growth, satisfaction, and even better mental and physical health. People with better networks at work get sick less often and live longer, not to mention they just enjoy their day-to-day jobs a lot more.
- Contribute to a giving culture: When you act to increase your own social capital, you’re improving the culture of your company overall, which benefits you directly as well as everyone else.
For enterprises or for leaders within organizations, there are also huge rewards from helping your employees boost their social capital. The rewards are so significant, that I believe social capital should be a resource as deserving of your time and focus as financial capital or human capital.
Four benefits of improved social capital for organizations and teams:
- Boost employee engagement: Enterprises spend billions of dollars per year on trying to improve employee engagement because it’s a proven driver of employee loyalty, retention, and all other sorts of business-positive outcomes.
- Increase efficiency: Employees with strong social capital will be able to get the help and answers they need from their network much faster than those without strong connections. Social capital is the grease that keeps the corporate wheels turning smoothly.
- Improve collaboration: The strongest ideas, innovations, and execution usually comes from groups of devoted and passionate employees working together to solve problems and develop new solutions, processes, product ideas, strategies, and more.
- Drive better business outcomes: Better work networks have been associated with higher unit profitability, productivity, efficiency, retention, and customer satisfaction, along with lower costs.
A clear, sustained, dedicated focus on social capital in the workplace is clearly beneficial to everyone. Can you think of any reasons I’ve missed?
Next week, I’ll write about how you build social capital.