The Importance of Social Capital

After wrapping up another #MVPbuzzChat interview for my ongoing series, I was reflecting on part of the conversation about the value and importance of community — and how my personal experience aligns with much of what I’ve read on the topic of Social Capital Theory. The net-net of Social Capital Theory is that our interpersonal relations create value as we share content, our experiences, and other resources — which can, in turn, be used for achieving desired outcomes.

Robert Putnam, a Harvard sociologist, observed that “much of the success of the United States as a nation had to do with its ability to generate social capital, that mysterious but critical set of characteristics of functioning communities.”

What is Social Capital?

Social capital is, simply put, the level of trust that is earned by an individual or a brand within a social construct. At an individual level, a new user entering a technology forum, for instance, has no social capital. As they participate in conversation threads and get to know other participants, asking questions and sharing their experiences, they can slowly build social capital.

Photo by @dole777 on unsplashFor organizations, it is partly about building trust with employees through regular communications, the benefits provided, and by providing a climate where managers and peers can collaborate. It is also about building similar trust with customers and partners by not only providing products and services, but also guidance and expertise and other resources beyond the selling activities. A great example has been the SharePoint and Microsoft Teams community, where some companies have been able to develop deep social capital through their support for community events, user groups, and the activities of their own employees — while others have not put in the time and effort and attempt to spend big on community-focused marketing campaigns, but fail to make any lasting impact.

My own observation has been that highly trusted individuals and brands (companies) who do not participate in online social networking will often not automatically receive this same level of trust within the digital world, as the types of interactions may be different between expert and community, and the rules that define social capital may be different.

The impacts of Social Capital

As I wrote about in my ebook “Tap Into Social Capital to Build Your Brand” a few years back, many people — and companies — make the mistake of thinking that their outward branding efforts (logo, website, latest marketing campaign) is what constitutes their brand, when the reality is that social capital — and the lack thereof — can have a much greater impact on how people view you/your brand. Don’t underestimate the value of “goodwill” that can be generated through community-focused efforts, such as donating time and resources, providing free content and sharing your expertise (articles, webinars, ebooks), and by simply “showing up” to community events and activities. When done consistently, you/your brand will generate goodwill that translates into social capital.

The importance of augmenting or improving one’s social capital, whether online or offline, may benefit more than just the quality of your professional relationships.

Putnam continued, “Individuals in groups with more social capital are better off on a large number of metrics, from health and happiness to earning potential, than in those groups with less social capital.” Individuals with strong social capital have more access to data, and generate quicker and more detailed feedback from their networks. Case in point: anyone new to the SharePoint community can ask a question via Twitter and generally get a quick response back, but the volume and (quality) or responses increases dramatically when the same question is picked up by and re-tweeted by a trusted member of the community.

Traditional social capital (through conversation, offline interactions) is on the decline, while online social capital is on the rise. Why? A lack of time. Online interactions provide a much more efficient method for most forms of professional communication. However, quality is clearly impacted. Putnam concludes, “Across a remarkably broad range of measures, participation in group activities, the vehicle for creating and sustaining sound capital, was on the decline in the United States. One of the greatest assets in the growth and stability of the US was ebbing away. One cause of the decline in social capital was a simple increase in the difficulty of people getting together — an increase in transaction costs, to use Coase’s term.”

Christian Buckley

Christian is a Microsoft Regional Director and M365 Apps & Services MVP, and an award-winning product marketer and technology evangelist, based in Silicon Slopes (Lehi), Utah. He is the Director of North American Partner Management for leading ISV Rencore (, leads content strategy for TekkiGurus, and is an advisor for both revealit.TV and WellnessWits. He hosts the monthly #CollabTalk TweetJam, the weekly #CollabTalk Podcast, and the Microsoft 365 Ask-Me-Anything (#M365AMA) series.