Social Capital

The concept refers to features of social organization that create an environment of mutual benefits and coordination. The concept of social capital is broadly defined as an asset that inheres in social relations and networks. From a micro perspective many researchers have studied it at individual level, and from a macro perspective it has been studied at community and organization level. In the recent era, the term social capital is highlighted more at the organizational facet. Leana and Van Buren describe organizational social capital as a resource reflecting the character of social relations within the firm formed by goal orientation and shared trust. Social capital is broadly categorized as structured social capital and relational social capital. Thus, the conceptualization of organizational social capital is like a value enhancing system resource.

Social capital has been identified by many researchers to be related to organizational advantage.

Adler and Kwon have identified organizational social capital to be related to organizational performance through building trust. It also has potential benefits for building intellectual capital and innovation in the organization.

The concept has been further operational zed in different ways in social science research. The majority of research in the domain of social capital is at the individual level where the motive of research is to identify individual social capital in the society. Management studies have adopted this conceptualization at the organizational level by recognizing the benefits of networking, social ties and resources that are inherent in those relationships.

As defined by Coleman, social capital is an asset that consists of network of relationships and their inherent resources and other network structures. This leads to ties among the members of a group, and these ties affect the individual’s attitude, sense of support and attachment. Networking serves as social support to the people that effects satisfaction and ease at work through social support.

The central premise of social capital is that social networks have value. Social capital is a collective value of all “social networks” [who people know] and the inclinations that arise from these networks to do things for each other [“norms of reciprocity”].Social capital refers to the institutions, relationships, and norms that shape the quality and quantity of a society’s social interactions. Increasing evidence shows that social cohesion is critical for societies to prosper economically and for development to be sustainable. Social capital is not just the sum of the institutions which underpin a society – it is the glue that holds them together.

The term social capital emphasizes on a wide variety of quite specific benefits that flow from the trust, reciprocity, information, and cooperation associated with social networks. Social capital creates value for the people who are connected and, at least sometimes, for bystanders as well.

Social capital works through multiple channels:

• Information flows (e.g. learning about jobs, learning about candidates running for office, exchanging ideas at college, etc.) depend on social capital.
• Norms of reciprocity (mutual aid) rely on social networks. Bonding networks that connect folks who are similar sustain particularized (in-group) reciprocity. Bridging networks that connect individuals who are diverse sustain generalized reciprocity.
• Collective action depends upon social networks (e.g., the role that the black church played in the Civil Rights movement), although collective action also can foster new networks.
• Broader identities and solidarity are encouraged by social networks that help translate an “I” mentality into a “we” mentality.

For example when a group of neighbours informally keep an eye on one another’s homes, that’s social capital in action. When a tightly knit community of Hassidic Jews trade diamonds without having to test each gem for purity, that’s social capital in action. Barn-raising on the frontier was social capital in action, and so too are e-mail exchanges among members of a cancer support group. Social capital can be found in friendship networks, neighbourhoods, churches, schools, bridge clubs, civic associations, and even bars.