Saturday, 31 October 2009

From human to social capital


I’ve got an article, ‘Building Human into Social Capital’ in the new issue of Strategic HR Review.

This is an excerpt:


Building social capital

But what about social capital? This is another outcome and refers to the connections, relationships and conversations between people working in an organization. The differences between this and both human and organizational capital are important, as each need developing in different ways.

Social capital is developed by paying attention to how people are relating to each other – to the spaces between people on the organization chart. However, social capital is highly intangible and the links between it and the activities that develop it are complex and distant in time and space. It is not something that is easy to measure or develop and, because of this, it tends to get ignored.

However, the point of performance in most organizations is the team, not the individual. So it is social capital, rather than human capital, that is the greatest enabler for competitive success. Consider these two examples to illustrate its role:

  1. Developing a culture of innovation. Changing culture depends on having a big idea and aligning everyone in an organization around it. However, this is not just about behavioral and attitudinal change. Encouraging people to be more innovative is also about helping them create new types of meaning about their work – and meaning is established through conversations with other people. So if you change the conversations (part of the social capital), you change the meanings and, therefore, the culture too.
  2. Knowledge management. Many businesses have tried to manage the explicit knowledge residing in their databases but a lot of these organizations are now realizing that much more important is the tacit knowledge in their peoples’ heads. Knowledge management in this paradigm is about connecting the right people and enabling them to participate in effective conversations (social capital again) to share and build on the knowledge that exists.


See the journal for more from the article (or keep tuned to my Strategic Advantage blog for more of the same).



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