Social Capital: Glue for Sustainability - WHY?

I recently attended a presentation given by a colleague who holds a senior position with a global financial services firm nominally on the topic of social capital and networks.  My colleague was open in admitting the the idea of organizational network analysis (ONA) had not yet been "sold" to the organization.

It seemed clear to me why it had not.  There was no business or strategic imperative stated that would make undertaking ONA of value to the organization.  Tactical benefits of identifying high performers (top talent) and information flows was the rationale- good for the current state of effectiveness and efficiency for today but that only helps you hold your own not give you a competitive advantage for the future.

If I do not have a context - Where is our business going and what are we trying to achieve to stay sustainable? my analysis will only confirm the present. Glazed eyes of senior execs. Maybe we bridge some gaps, however for all the effort the big gains are lost.

Making the strategy happen is what lights up business leaders. Being able to identify competencies and skill sets we need to make that future happen needs to be the rationale of the person proposing organization network analysis. Social capital is that illusive bond that your current talent may have and future talent need to be masters at building. 

Social capital is "created by a network in which the people can broker connections between otherwise disconnected segments" or "structural holes" according to Ron Burt. ONA exposes social capital opportunity - the external networks to be brokered by your current talent and new talent entering the firm - for innovation and growth.

Have you ever wondered why some firms seem to have cultures of constant renewal, regeneration and sustainability - it's their social capital capacity.

My partner Jenny Ambrozek just returned from the Enterprise 2.0 Summit at CEBIT in Hannover Germany where her presentation on Structural Holes addressed the importance of identifying the business driver up front.

We will be presenting our workshop on Social Capital:The Glue for Sustainability at the NJOD Annual Sharing Day on May 1st and Community 2.0 Conference at Red Rock Resort in Las Vegas May 15th.  For friends 20% discount use code SPKRM2005 when registering.

The business environment is too complex and moving too fast to not know your social capital capacity - your sustainability depends on it!

~ Victoria G. Axelrod

Comments

[Bill Becker]

In the olden days of the last Century (circa 1960' - 1980's) the term for "Talent Management" was "Human Resources Review and Succession Planning", at least in the several corporations for which I created such systems.

Vicki Axelrod is correct in that such systems were circumscribed to the internal organization for the most part. In that more stable environment this worked. However in what has become a world without boundries it is ever more important for organizations to have a strategic intent rather than only a strategic plan. A strategic intent provides a more flexible frame that is adaptive. Further, an organization with a Strategic Intent must focus less on traditional control mechanisims in 'managing' their talent.

The question therefore arises in my mind as to what exactly does Talent Management mean today...tomorrow? Is it a combination of training, development and rotation through different positions and locations as in the olden days of the 20th Century? As that Century came to a close the perspective by organizations was(and is still today I believe) that each employee is responsible for his/her own career development. This then puts the employee in the driver seat and requires her/him to be more aware of external opportunities in current personal competency areas as well as emerging jobs with tangential competencies. In that younger employees are more into networking and the use of technology and have a better understanding of how it is creating new opportunities they just might be in the driver's seat...so who is doing the "managing"?

Certainly this is not easy for any company. Given so many built-in constraints such as antiquated HR systems, IT systems that have no way of tracking, believe it or not, exact daily counts on the number of people in grade levels in the company because things change to quickly, line managers that are so busy with daily transactional duties they have little time (not to mention basic knowledge or skills) on how to help their reporting associates develop their careers, and so forth. Then of course more people are working if not full-time at least part-time from home or other away locations, which if not in rality gives the iemployee a psychological sense of being more independent.

In a way, the fact that we all are so responsible and accountable for our own careers, despite the mirage put forth by companies with good intentions, ONA driven by a business driver may provide a more truthful look at the reality for both companies and individuals!

[Jenny Ambrozek]

Profound analysis and questions Bill that raised multiple thoughts for responding. What bubbled to the top however was McKinsey consultants Bryan & Joyce 2006 book "Mobilizing Minds" that I reviewed for World Business Magazine. http://www.worldbusinesslive.com/thisIssue/article/667957/bookshelf-engaging-talent/

The bottom line for Bryan and Joyce as I understand it was:

"In a world where value is increasingly generated through intangible capital, corporate strategy should focus on organisational redesign to mobilise the mind power of employees and tap underused talent, knowledge, relationships and skills."

To me your comment clearly suggests more actively supporting talent is part of that. In light of the starting point for Victoria's post being "Social Capital: Glue for Sustainability, citing Ron Burt (to whom "structural holes" are attributed), it's also interesting to look at Burt's work at Raytheon with Don Ronchi using network approaches to nurture high performers. The Burt & Ronchi article on "Teaching executives to see social capital: Results of a field experiment" is here: http://faculty.chicagogsb.edu/ronald.burt/research/TESSC.pdf

Thanks,
Jenny

[Duncan Work]

Hi and thanks for this post.

ONA is primarily a tool for *measuring* social capital, whereas enterprise applications like Trampoline’s SONAR and Visible Path, as well as LinkedIn, are tools for using it. That is, these latter tools reveal connection strengths along with expertise in order to give people better info to decide whom to contact for specific purposes. These tools also help people develop social capital by using existing trusted connections to make new trusted connections.

Has anyone measured the value added by social capital for knowledge transfer inside large organizations?

For example, how frequently does knowledge transfer break down when using knowledge and expertise location tools that *don’t* have an ONA component (no measure of connectivity between individuals)? Theoretically, a cold-call request to another person in the same organization is more likely to be ignored than a request from a close contact of a close contact. Is there now good data to support this?

If so, it seems that any such study would have to control for the org culture - the degree that social capital has been built up within the organization such that individuals are motivated to help each other even if not closely connected by a mutual contact.