Summary: networking and social capital is more important than ever. More and more companies are instituting teleworking policies as a result of the spreading coronavirus. Here are 6 ways to improve your social capital.
According to Investopedia, there are three kinds of capital we should all know about:
- Financial capital means money, both debt and equity. How are you funding your business?
- Human capital refers to the skills, abilities, and knowledge that employees bring to an organization.
- Social capital refers to the practice of developing and maintaining relationships to form social networks. It can be simply defined as how willing people are to help others in their social network.
Social capital is the least discussed but one of the most important.
In fact, I think leaders should focus just as much on social capital as they do on human l capital and even financial capital. After all, good social capital can help solve many financial and human capital issues anyway. We are going to need to excel in all three areas in order to become successful and sustain that success.
Now more than ever, social capital is critical to our success.
There was already a growing trend of decentralized workforces, more remote workers, and more freelancers.
But as some of the biggest tech companies, universities, and employers announce optional (or mandatory) telecommuting policies in light of the spreading coronavirus, there will more remote workers than there ever have been.
If you have high social capital, it means you know a lot of people and have a decent enough reputation to get help when you need it.
6 Benefits of Good Social Capital
- Good social capital makes it easier to find and get a job. Most people get jobs through their networks and people they know (and most employers fill jobs the same way). Scientific research supports long-held conventional wisdom: most people find jobs through personal contacts; they find better paying, more satisfying jobs than the ones available through formal channels; and they stay at these jobs longer.
- You’ll probably make more money. People with rich social capital are paid better, promoted faster, and promoted at younger ages.
- People with good social capital have more influence and are more effective. In modern organizations, formal authority is less important and effective than expertise and social influence. Moreover, managers with a good mental map of who gets along and who doesn’t are more influential and effective as well.
- Well-networked people find it easier to raise money and get investors. A study by the U.S. Small Business Administration found that 75% of startups and new businesses find and secure financiaing through the “informal investing grapevine.” Companies that have personal relationships with their banks get lower rates. Research shows that even institutional investors are influenced by personal relationships.
- People with high social capital learn more. Studies show that as much as 70% of learning in workplaces happens informally. The more people you know and get along with, the more you’ll have the opportunity to learn.
- Good social capital makes strategic alliances easier and faster. For example, compatible alliance partners often find each other through social and business contacts.
6 Ways to Increase Your Social Capital
So as leaders, how do we encourage and sustain a focus on social capital for ourselves and on our teams? Networking is part of the answer, but that’s not a word that gets many people excited. I don’t know about you, but when I used to hear “networking,” I envisioned standing around at cocktail parties making small talk. But it is so much more than that.
You can find lists with dozens of practical ideas for building social capital. (Have lunch in the common area! Ask someone how their day was at the water cooler. These are considerably harder to do if you’re working remotely because of a global pandemic).
I came up with a few overarching themes or principles. These ideas will help you guide you and your team in building social capital.
1. Offer help.
The best and fastest way to build trust within your network (and to expand that network) is to offer help.
Help could be in the form of your time, your advice, an offer to make an introduction, a referral, an answer, or an outside perspective. Being known as a willing helper strengthens your existing relationships.
2. Ask for help
Believe it or not, but asking for help is just as important for building social capital as offering help. Your networks want to help you as much as you want to help them. Giving them an opportunity to do so cements social bonds.
3. Be a “giver.”
So much of the advice around building social capital is oriented around what you can get from other people and how to maximize what you take.
I can see it from a mile away when someone is getting close to me just to benefit themselves.
Approach all new contacts from the perspective of “what do I have to offer this person?” instead of “what’s in it for me.”
You can read Adam Grant’s book Give and Take for a far more nuanced view on the personal and career advantages of being a giver, a taker, or a matcher.
4. Show gratitude.
I’m not suggesting you overdo it and fall over yourself to thank someone for something tiny. But make sure they know that you appreciate their help when they give it.
It can be as simple as a quick email or note of appreciation for a small favor or introduction, acknowledging them publicly in a team meeting, or in the case of a special favor, a handwritten note or small gift.
Be a person that people enjoy helping.
My goal is to listen more than I talk in meetings, especially as a leader.
If I’m invited to a meeting to contribute my expertise, I do so willingly. However, I also make sure I sit back and listen thoughtfully to the issues before jumping in.
6. Be a good role model.
We all know the very best way to foster new practices in our teams is to model these principles ourselves.
Your team needs to see you as an effective leader who values and prioritizes the social network. They will follow suit.
Use Givitas to Make It Easy
All of these practices will grow your social network and improve your social capital.
Givitas is a knowledge collaboration platform that makes it quick and easy to ask for help, offer help, show gratitude, and be a giver. And you can do it in less than 5 minutes a week.
If you’d like to see how Givitas is being used by remote teams around the country, we’d love to show you a demo.Request a Demo