In business, we often focus on the importance of capital – financial capital and human capital, but there is another form of capital that deserves every leader’s attention: social capital. It is the often unseen glue that holds teams together, provides a sense of belonging, fuels engagement, lowers turnover, facilitates knowledge sharing, and undergirds both individual and organizational performance. And it deserves attention because it is waning.
In March 2022, McKinsey & Co conducted a Social Capital Survey with over 5500 respondents in the US which showed a significant decrease in social capital since the start of the pandemic. On an October podcast regarding the survey, Brooke Weddle shared that “Access to capital has gone way down. Specifically, fewer than 15 percent of employees reported their network had grown. Only about a fifth of employees felt that they were more connected to people in their network.”1 While this may not be surprising given the rapid shift to remote at the outset and now the settling in of hybrid, it is a trend that is troubling.
The data also reinforced the benefits of cultivating connection. Respondents who felt more connected had higher levels of sponsorship (i.e., willingness to advocate for and invest in others), higher levels of engagement, and a greater sense of belonging.2 For leaders, the evidence is clear. Helping our team members build their social capital helps promote their success, and it is also essential to the business. So, how do we do it?
Consider the following activities and how you might be more intentional and purposeful in helping team members build social capital through each:
- Relational Onboarding – In onboarding, it is important to not just focus on the information one needs to complete their tasks but also on the relationships that will be important for them to succeed. The first step in relational onboarding is to consider who they might need to know to promote growth in their role, including who might coach them, who might be in the best position to be a sounding board for them, who might they find valuable from a technical or industry perspective, or who might help them make important connections in the firm or community. The second step is to ensure you are intentional in the onboarding plan to establish meetings with these individuals for relationship building. Keep in mind that effective onboarding takes place over the first year, not the first week of employment, so it’s the purposeful attention to creating these connections over time that can have a big impact.
- Sponsorship – Sponsorship within the workplace is the act of really investing in a team member to support their growth and development. Organizations that have a strong talent pipeline have strong sponsorship. Their leaders and managers feel accountable for developing and growing talent, and a part of that is helping that talent build social capital as they advance. This may include helping them get to know influencers or leaders in other areas or other disciplines, exposing them to new customer relationships, and including them in meetings or events that they might not otherwise attend. Having a heightened attention to active sponsorship is a key contributor to enhancing social capital in the organization.
- Leadership – Larry Bossidy once said “The behavior of a business’s leaders is, ultimately, the behavior of the organization. As such, it’s the foundation of culture”. To cultivate a culture of connection, you must have leaders at every level that support it and role model the way. Team members who see leaders demonstrating that social connections are prioritized, valued, and essential to achieving the best work outcomes will feel more confident in investing the time and effort to create and maintain them as a part of their role. In short, leaders must reinforce the importance and benefit of social connection in the workplace.
Notice, social events were not mentioned as a focused activity to consider. While social events are a natural setting for building connection and likely will occur as a part of all of the above, they should not be the sole focus or activity for building connection. The greatest benefits from social capital and the strength of its presence come from helping someone build it into the fabric their career journey with the organization and as a part of how they work.
To assess the state of social capital in your organization, take a look at your own team and connections. Do the connections feel as strong as they once did? If not, what can you do to strengthen them? How might it look if you put yourself in the shoes of someone who has joined the organization in the past two years? Do they understand the importance of building social connections as a part of their work? How strong are their social connections outside of their immediate work area? What do they see in terms of role modeling from leaders? What do you see in terms of active sponsorship in your organization? Reflecting on these questions will help you identify what you might do to re-strengthen social capital. By taking action, you will not only help the individual team members succeed, you will build affiliation, belonging, and engagement which yield more productive outcomes and deliver stronger results.
1 Social capital: Build back better relationships at work by John Parsons and Brooke Weddle
2 Network effects: How to rebuild social capital and improve corporate performance by Taylor Lauricella, John Parsons, Bill Schaninger, and Brooke Weddle, McKinsey & Co.