"Social Capital Investment Boosts Corporate Growth"

"Social Capital Investment Boosts Corporate Growth"

It is familiar to all that financial capital is the pillar of business world. Social capital is the low profile sibling of this pillar, which nevertheless greatly influences the profit lines of an organization. Social capital constitutes the informal networks, the know-how amassed through years of experience, the bonding between the employees, business ethics, work culture, trust and corporate mission. Building this soft side of business helps immensely in achieving sustained corporate growth. Social capital has to be consciously developed and carefully nurtured through appropriate organizational policies and practices. Firms that realize the importance of social capital as part of their success formula build it on the following lines :

v Hiring the best fit: More than education and experience the right organizational fit is considered important in building social capital. Technical skills are honed through training but the right attitude that fits the corporate culture is important for employees to have good interpersonal relationships with co-workers and develop a strong bond with the organization. This they believe aids in increasing the efficiency and productivity of employees.

v Training new employees: The new employees are given hands on training from their experienced senior colleagues and higher-ups. Thereby they learn the ropes faster and also build networks through the organizational hierarchy. Training on broader lines ensures that the employee's knowledge is not limited to his department and improves his understanding of the larger context in which the organization functions.

v Encouraging creativity: The top management takes a keen interest in fostering creativity in the work force. They personally interact with the staff to remove roadblocks that hinder creativity. This gives them access to best growth ideas, which the staff would have otherwise hesitated to communicate to their superiors.

v Share ideas: They organize forums to bring together people from different departments. This gives the employees an opportunity to share ideas, understand the complete picture of the organization and to build personal networks with other employees.

v Strong on values: Social capital thrives when organizational values are shared by one and all. For this to happen the top management should lead by example and communicate a clear set of values to its employees. Work force with common values is much more efficient and focused.

v Job security: Employee lay-offs during bad periods erode social capital. Making employment a long-term commitment has many advantages. Employees with stable jobs can concentrate better as they feel secure. They work harder to pull the organization through difficulties.

v Promoting from within: The policy of promoting from within leads to lower attrition and the company enjoys the benefits of leadership continuity and creation of an in depth knowledge repository.

v Common mission: The firm can generate social capital as employees identify themselves with the company's mission and share its vision. The employees who take pride in the company's mission work and strive to accomplish its goals and objectives.

The benefits from creating social capital manifest in myriad ways. Organizations that emphasize on social capital create a competitive work force. People learn to work together and share common goals. So, conflict occurrences are minimized and even if they arise they are resolved amicably and quickly. Trust is an important aspect of social capital. Managers trust their employees to do the right things. The employees are given freedom to fix problems without waiting for instructions. Managers can concentrate on more important matters than micro managing staff. Knowledge and idea sharing help in quick problem solving. Learning agility and flexibility acquired through mentoring by superiors helps employees to quickly adopt changes. Innovative solutions inspired by a creative work environment offer a distinct edge over competitors and enable the company to grab new business opportunities. Social capital does not appear on an company's balance sheet, but its impact on the bottom line is more than obvious.

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