Definitions of Social Capital:
Social Capital - The degree to which a community or society collaborates and cooperates (through such mechanisms as networks, shared trust, norms and values) to achieve mutual benefits.
Social Capital - The value of a social network is that people can draw others to solve common problems. The benefits of social capital flow from the trust, reciprocity, information, and cooperation associated with social networks.
Social Capital - Skills and infrastructure that aid in social progress.
Social Capital - A "composite measure" which reflects both the breadth and depth of civic community (staying informed about community life and participating in its associations) as well as the public's participation in political life. It is characterized by a sense of social trust and mutual interconnectedness, which is enhanced over time though positive interaction and collaboration in shared interests.
Social Capital - represents the degree of social cohesion which exists in communities. It refers to the processes between people which establish networks, norms, and social trust, and facilitate coordination and cooperation for mutual benefit.
Social Capital - The relationships, human networks, language, etc., possessed by the individuals in the organization.
You guessed it. Today’s subject is Social capital. Social capital, Economic capital and Cultural capital make up the three types of capital in the world. Economic capital is monetary and is the common form of wealth. Cultural capital is the accumulated wisdom of a society like: engineering, music, architecture etc. Social capital is the wealth created by tight interconnected relationships. The Team community has incredible value because it has near unlimited Social capital. Today’s society is becoming more and more autonomous and less involved in their communities. The Team gets people involved and not sitting at home in front of the TV. Even if you are with your family watching TV, you are still alone as everyone is passively being entertained. I believe Social capital provides at least three major benefits:
The first benefit is a large community has people with skills in nearly every area of life. This is a form of Metcalfe’s law, which is defined in Wiki in the following way.
Metcalfe's law states that the value of a telecommunications network is proportional to the square of the number of users of the system (n2). First formulated by Robert Metcalfe in regard to Ethernet, Metcalfe's law explains many of the network effects of communication technologies and networks such as the Internet, social networking, and the World Wide Web. It is related to the fact that the number of unique connections in a network of a number of nodes (n) can be expressed mathematically as n * (n − 1) / 2, which follows n2 asymptotically. The law has often been illustrated using the example of fax machines: a single fax machine is useless, but the value of every fax machine increases with the total number of fax machines in the network, because the total number of people with whom each user may send and receive documents increases. In fact, Metcalf's law measures the potential number of contacts, i.e. the technological side of a network. However the social utility of a network depends upon the number of nodes in contact. For instance, if Chinese and Non-Chinese don't understand each other the utility of network of users that speak the other language is at zero, and the law has to be calculated for the two networks separately.
It may sounds confusing, but actually is fairly simple. One fax machine has no value because you cannot send or receive anything. With an addition of one machine, now you have a value of 2*(2-1)/2 = 1. Add one more fax machine and now you have 3*(3-1)/2 = 3. Let’s do one more to show you the compounding effect. Let’s increase to 100 fax machines interconnected. 100*(100-99)/2 = 4950. Two fax machines produced a connectivity value of 1 and 100 fax machines produced a value of 4950. If you are following me—this means a 50 increase in machines produced a 4950 increase in connectivity value. The value of the community compounds exponentially with every person or item added. The Team community increases at the same exponential rate. There is a huge social capital value difference between a 100 people team and a 200 people team. Run Metcalfe’s law and see for yourself. Now you see why in the Information Age—leadership is the highest paid profession. Those who will invest in their leadership ability and build communities will have company after company pleading with them to market their products. Leadership is clearly the major competitive advantage in today's connected economy.
Laurie and I had a leaking faucet and instead of looking in the yellow pages, we called Jim Martin. Jim is a former plumber and he gave us a recommendation on a good plumber to use. The plumber did a great job and we were stress free because we knew they would do a great job at a reasonable price. It is hard to put a price tag on the security of knowing any challenge you have – someone in your community is an expert in that field. When you join the Team, you automatically begin to enjoy the benefits of Metcalfe’s law in the accumulated Social capital of the Team. How much would you pay for this security? This is one major benefit of social capital.
The second benefit is when life knocks you down—you have people there to encourage you through the pain. The increase in prescribed drugs and counseling for depression is a national dilemma. Why are people wealthier materially and enjoy more material things than ever before, but more depressed than ever before? Aristotle said that human beings were political beings and needed interactions with other humans. Our society is losing the ability for people to empathize with one another. I read a study where people could endure twice the level of pain—by immersing their arm in an ice bucket—if they had someone with them to comfort them. Life can be tough at times and it sure is nice to have a group of friends to encourage and uplift you when you get knocked down. This is another aspect of social capital that is priceless to me and worth more than all the material rewards Laurie and I have been blessed with.
The third major benefit of a social community is the modeling and mentoring of people who have more success in specific areas. There are so many conflicting opinions in life about what to do and how to succeed. What I love about the Team community and the social capital developed is the ability to check the fruit on the tree. Anyone can offer advice, but a community allows you to see the results of a particular way of thinking in their lives. There are so many talented people involved with the Team that account for the social capital. In nearly every area of life from: faith, finances, fitness, friends, and family, someone in the community has a system that is working in that area. The beautiful part is—they are ready and willing to share anything they have learned with you. This is why we have CD’s and recommend specific books for all areas of life. I love the statement, "Learn from experience, preferably someone else's." The books and CD’s have proven to be effective in providing the right information for people to change their thinking and behaviors. What would it be worth to mentor with someone with the results in life you are looking for?
I have just scratched the surface on the value of social capital. I would say hands down that social capital is worth more than financial capital and can be converted to financial capital a lot easier than financial capital converts to social capital. A billionaire with no social capital is not worth as much as a leader with social capital. The future leaders of society will be the connectors who build social capital. I hope this helps explain the value of the Team community and the value in developing your personal leadership skill. Bring your talents and abilities to the table and you will exponentially increase the social capital of the Team. God Bless, Orrin Woodward
Assignment: What abilities and talents do you bring to the Team? Are you connecting your skills with others to create a Team and bring Metcalfe’s law to fruition in your community? What other benefits of a community creating social capital can you think of?
