Foundations are important. They let your house stand in a hurricane. They form the backbone of a successful business. They provide the basis upon which a government rules and conducts itself. They provide a reason to believe.
There is a set of foundations that we neglect, but articulates itself right under its nose. This set of foundations is something called social capital.
I mentioned this term to many people and all of them don’t know what it means. That’s not good. Social capital is perhaps the most critical foundation for doing anything. It is the most human and relational. Yet it is the most difficult to quantify because of its asymmetrical, unpredictable, historic and qualitative properties. It is not a framework applied in doing business analysis. It has no place in developing a better app or a new process architecture.
So what is social capital. It is the set of trust-driven reciprocal relations among people of congruent qualities (family, religion, race, culture, education, activities, political affiliation) that provide the basis of value-creating community. You can find out more about this topic in Robert Putnam’s elaborate 1999 Bowling Alone. However, it is worth nothing that according to Putnam, social capital in the United States collapsed since the 1960s revolutions. This can effectively elucidate the myriad problems our country faces today.
Social capital is clearly missing from the Business Analysis Book of Knowledge in its latest version. Yet it provides a higher-level perspective on the interests, behaviors, needs and desires of stakeholders. Stakeholders decide however to show trust to others. While it is difficult to identify the needs for a social capital analysis in Silicon Valley, there is at least one sector where it is vital.
That sector is religion, or more specifically the American church. There is the infamous meme of 3,000 churches closing every year. Whether it is due to more liberal attitudes, declining attendance, lack of money or rising rents, we don’t really know. But the church is not immune to the collapse of social capital in this nation. Where the culture goes, so does the church.
Why is this example important? It shows that new technology is not the answer to creating more value. A declining church will not save itself by social media, satellite video link or smartphone apps. On practice, the basis of a church is the people. And if people drop in and drop out and not spend extended time for each other, then value is destroyed and the church is closed. Consumer capitalism is clearly anathema to the principles of the church.
Stakeholders can be looked at on the basis of individual interests, qualities, concerns and objectives. Yet we would do much better to analyze multiple stakeholders and how they relate to one another. That is how you understand a church and its needs, current state, future state and candidate solutions. The state of the social capital base in a church underpins any analysis being done to improve a church’s value. This is important.
Without a strong and stable social capital base, no solution no matter how effective will ever make a difference. We can take the example of the church and extend it to any other enterprise. Uber, for example, is in turmoil because of the crisis at the top and allegations of abusive employee relations. This startup monster can’t seem to right its ship with its amazing technology. As long as the social capital base remains toxic, Uber cannot regain its former glory. Technology means nothing if human relations stay stuck in park.
I just left a company that suffers from turmoil at the top. Because of a lack of facilitation skill among upper management, the company has missed many opportunities for growth and value in the hostile health-insurance market. Just like the church, businesses must make primary investments in building a strong social capital base. Everybody brings value, but that will not happen unless there is a social system of trust, accountability and reciprocity. Don’t build the tech first. Business analysts should endeavor to help build valuable social capital base. The solutions will develop by themselves.