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Success with social networks - About the profits of steering on social capital

Dit artikel door Dr. Annemarie Hinten-Nooijen is gepubliceerd in Asset Magazine.

Success with social networks - About the profits of steering on social capital

geplaatst: 23-09-10

It's all about guts. How many contacts do you have on Facebook or LinkedIn? How often have you asked them for help with a practical, personal or business problem? Or do you try to solve these problems by yourself? Probably you do, since we do not have a culture of asking someone for help. But what a shame. People like to help each other. And many people have material, help, knowledge and a network left. When they give this social capital away, it does not decrease, but actually grows. The more you help people, the better your network, your reputation, and the access to resources you normally had to pay for are. In the near future, the time of the brilliant-lonely-hero-fixes-it all-model will be over. The (use of) internal and external networks will make or break the success of organizations. Who wants to be the first CNO, chief network officer? And what will it mean for the economy and society when companies, authorities and society as a whole are steered on social capital?

Suppose a sales employee from a reputable bank who is faced with a customer with a demand to settle a Yuan-debt to be converted. He is happy with the command and lets the customer know that he will call him the day after with an optimal supply. Unfortunately, the bank's expert in this particular monetary unit is on holiday. The sales employee's supervisor is busy and suggests that he call the central department. Who should he ask for? He realizes that it would have been better if he had better maintained the contacts with his colleagues from various departments. It costs him much time to find the right person. And when he calls his client two days later, it will turn out that he received and took the nice offer from another bank that could deliver it in one day.

The image of this sales employee is a kind of a John Wayne-like vendor, an individualist, who hopes to get the best deals with his great personal skills and his own efforts. But this model of the lonely hero no longer works. Our current economy is becoming increasingly complex, with many customer segments and product portfolios. A new method of successfully building new client groups is to build a good network. And the most important lesson in networking is that you should have the personal attitude 'I cannot create success on my own'.

MODERN TECHNOLOGY AND SOCIETY
You might think that there is no need for networks, as business processes have been standardized and computerized and people serve detailed technical systems. It is, however, precisely for this reason that networks are becoming increasingly important given the enormous changes in the business world such as mergers, restructuring, transferring departments, and new business models. With increasing delays in decisions, uncertainties in production processes and possible customer dissatisfaction, maintaining an extensive network is becoming more and more important for sales and marketing: Current and extensive knowledge is available and increases the quality of the products, quick and well informed decisions can be made, and customers can be helped accurately.

Organizations do realize that the modern organization is a network organization and that in our current information and services economy employees are the critical success factor. They focus on talent management, using competence management and career development strategies. But these instruments are often aimed at the individual. You also need coherence and connection between all the talent to compete successfully with other market players, like in a football team. In modern companies, talent and relation are important. In this teamwork lies the social capital.

IT'S ALL ABOUT RELATIONS
Social capital is an elastic term with a variety of definitions in multiple disciplines. It is not what many people think it is: the value of the people in an organization. The term refers to the benefits we (could) receive from our social relationships, relationships which possess several forms of capital. Contrary to human capital, social capital relates not to natural persons but to the relations between them. Although people do not like to talk about capital when speaking of their relations, we can, in fact, see our relations as a form of capital: a controlled stock that has a certain value. After the French sociologist Pierre Bourdieu defined the term (1983), in the 1990s, the North American sociologists James Coleman and Robert D.

Putnam took the word 'social capital' as the chief characteristic of communities. According to them, social capital develops with the willingness of the citizens to cooperate with each other and requires a basis of trust on which cooperation and reciprocal support can develop. Putnam blamed television for the decline of social capital in the US. He was pessimistic about the decreasing amount of social capital in the USA. He illustrated this point with the metaphor of Americans bowling more often alone than in a team (Bowling Alone, 1995). The North American sociologist Nan Lin, among others, placed social networks at the centre of the concept 'social capital'.

PROFITS AND RISKS
Social capital provides for individual access to the resources of social assistance and social life such as support, recognition, knowledge, and connections for finding jobs and career advancement. For society, social capital reduces social costs to the extent that social assistance and support are positioned in the framework of the relationship networks. In cities where the social capital is high, children grow up healthier and safer and they are better raised; people live longer and happier; democracy and economy function better.

Will internet and social networks change the economy? The amount of existing social capital in a given society influences the growth or decline of economic growth. Economic business transactions and investments are uncertain in a low-confidence and more risk-averse climate. Much more work is required in order to provide legal protection, to work through extended contract negotiations, and to compensate warranty costs incurred due to contracts not being redeemed. In contrast, high social capital decreases transaction costs, extends productivity, and positively influences employment allocation.

Negative characteristics of social capital are the exclusion of other people and the loss of individual freedom through group pressure, such as takes place within sects and terrorist groups. In addition, the costs of support and assistance for the sick, elderly, and disabled could increase, to the extent that in modern societies with increasing individualization and mobility, relationship networks such as the structure of the neighbourhood association no longer function.

TO UNFRIEND AND TO TRUST
Although we think that anno 2010 we are a network society, it appears that this is not yet the case. The research bureau Multiscope performed comprehensive online market research - using a sample of 14.686 Dutch people - in order to measure knowledge of, attitudes towards, and the behaviour regarding social media. The use of social media proved to be lagging behind the familiarity with the concept. We spend an average of seven hours a month on social online networking.

People use an average of 1,8 social media websites at the same time. Hyves and You Tube are by far the largest (48 and 44%, respectively), while Facebook (19%) and LinkedIn (9%) are also popular. Most of the interviewees use the social media to stay in contact with friends and family (74%), while a minority stated they used the sites to meet new people (15%). Research based on interviews with American college students who used Facebook shows that Friending in Facebook served an instrumental purpose: keeping in touch with a wide network of individuals who might be called up to provide 'favours' in the future - i.e., in fact creating social capital.

A big social network seems to be the goal to achieve, but it may not always enlighten your life and career. It costs a good deal of time, money, and energy to keep in touch with all the contacts. Where it was previously important who had the biggest network, now people prefer quality instead of quantity among their contacts. And they are right to do so: in 2009 the word 'ontvrienden' (in English, as 'unfriend,' a popular new word) was chosen as 'word of the year'. It becomes important to choose your contacts from the perspective of the goal you want to achieve with your network. Having a (preferably large) network seems to guarantee your existence. But what happens when you are 'unfriended'?

Many networkers on social network sites realized that creating a profitable network means making a serious investment. It is a strategic asset that requires long-term building and maintaining relationships. A network is built on trust: The greater the trust, the more intensive and therefore more successful cooperative activities may be. And after the recent period that greed reigned supreme, we all know how crucial trust is for economies and societies as a whole... Networking starts with respect for and attention to the other person, according to Charles Ruffolo, an Italian-American Networker, who presents himself as 'Dutch king of networking'. He is the founder of the successful professional network organization RIBS; in addition, he develops and provides training programmes for organizations such as Canon, ABN AMRO, IBM, Microsoft, ING Bank, Heineken and Nijenrode University. Ruffolo stresses that it is not only about Me, Me, Me, or about getting things, but about giving. He stresses that networking for the sake of networking does not work.

SOCIAL NETWORKS REPLACING CONSULTANCIES
That networking works shows the enterprise 'durftevragen.com'. It is their aim to connect people. Daily it reaches more than 260.000 people, in particular through Twitter. Everyone can ask what he wants - from ways to get more new kinds of customs to ideas for getting a new job - but you have to dare to do so. And then other people can give you suggestions or links by Twitter or when meeting in a session. Olivier B. Bommel, the well-known creation of Dutch cartoonist Maarten Toonder, already knew that he had to visit his 'Kleine Club', a little club of dignitaries in his fictitious hometown of Rommeldam, when he had problems or questions.

Companies waste the richness of their social capital by not mapping out, keeping up, and exploiting it, according to Miriam Notten, director-owner of La Red, the largest Dutch network advice organization. Although organizations apparently see the importance of their employees having good network skills, job advertisements regularly ask for 'a big network', 'a good networker', 'a good network', research by La Red asking what they meant with these qualifications and how they would test them made it clear that organizations did not know, what kind of social capital the organization needed or how to evaluate it in hiring new personnel.

If organizations were to develop a work culture that focused on purposive action, encourages inter-section collaboration and allowed external contact; if they mobilized the collective network of all the employees for new ideas, development, and process management then we would save on the high cost of consultants who write reports that simply wind up being buried under a mountain of paper. What a boost for the economy!

dr. Annemarie Hinten-Nooijen (Academic Forum)

Sources:

  • Putnam, Robert D., 'Bowling Alone: America's Declining Social Capital', Journal of Democracy 6:1 (1995), pp. 65-78
  • Christian Deindl: 'Soziale Netzwerke und soziales Kapital. Einfluss auf Lebenszufriedenheit und Vertrauen'. Diskussionspapier der Forschungsgruppe Arbeit, Generation, Sozialstruktur der Universität Zürich. Zürich 2005.
  • De Volkskrant (13 March 2010)
  • Trouw (June/July 2010)
  • www.soziales-kapital.at
  • Miriam Notten: 'De Haves en de Have not's. Twee zijden van dezelfde netwerkmedaille', Develop 1-2010, pp. 35-41.
  • Steinfield, Charles; Ellison, Nicole B.; Lampe, Cliff: 'Social capital, self-esteem, and use of online social network sites: A longitudinal analysis', Journal of Applied Developmental Psychology 29 (2008), pp. 434-445.