OR Alone? Social Capital as a Professional Asset

1. OR Alone? Social Capital as a Professional Asset Presentation to the INFORMS Roundtable, Spring 2001 Michael Trick, Carnegie Mellon President-Elect, INFORMS

2. Outline • What is Social Capital? • Importance of Social Capital • Decrease in Social Networks • Implications for OR/MS Professionals • Questions for discussion

3. Inspiration • Presentation inspired by work in Bowling Alone by Robert Putnam • Much data and ideas taken from this book

4. Definition • Social Capital : measures of the value of social networks. • Those tangible substances that count for most in the daily lives of people: namely good will, fellowship, sympathy, and social intercourse [Hanifan, 1916]

5. Social Capital • Value we gain from interactions per se • Some interactions lead immediately to human capital (you teach me something: I gain human capital; I know you as a teacher, I (and you) gain social capital) • Generally the result of ongoing, repeated interactions

6. Social Capital • Not a “fuzzy”, “feel-good” concept, but a measurable aspect of life with clear economic and social implications. • Careful studies show executives with larger networks advance faster • Those who volunteer time are healthier • As illustrated, cause and effect can be problematic

7. Social Capital Information Exchange Illustration Information

8. Types of Social Capital • Bonding: interactions that bind a group together • Bridging: interactions that work to combine groups • Both important but have different implications (for getting a good job, wide social networks are often better than close-knit families)

9. Why is Social Capital Important/Useful? • “Lubricant” that makes interactions go (like money in economic transactions) • Leads to • Trust • Reciprocity • Cooperation • Institutional Effectiveness

10. Social Norms • Social Capital (and efforts to gain it) avoid “Tragedy of Commons” type inefficiencies • Avoids legalisms that can entrench poor choices

11. Downside to Social Capital • Social Capital also can lead to • Sectarianism • Ethnocentrism • Corruption • How can the positive aspects be maximized and the negative minimized?

12. Examples of activities • Working for Political Party • Serving as officer in a club • Church Attendence • Membership in professional organization • Entertainment at home • Bowled in a League

13. Declines? From the introductions today • “Not enough time” • “Feel bad I don’t do more” • “Lack of proximity” • “Commuting 20 hours/week” • “Used to do, but don’t do now” • “Part of a generation that doesn’t join”

14. Decline of Social Capital 1970-1995

15. Further Sign? • Informs Membership

16. Decline of Social Capital • By almost any measure, the activities that lead to social capital are declining after having reached a peak in 1950-1970 period • Decrease is strongest in youngest cohorts (relative to involvement of others at that age)

17. Exceptions • Even possible exceptions are not encouraging • Some membership organizations have grown (Greenpeace and the like from 8/1000 to 37/1000). Membership is essentially fundraising • “Small group movement”: growth limited to “inner-directed” AA and other self-help

18. What about the internet? • No evidence in data yet • Lots more talking, little listening • Few examples of true social capital building (issues with lack of social cues) • Huge issue remains: how can we use these technological advances to create real communities

19. Effects of this decline • Society is measurably more doubtful of others (people don’t trust each other as much) • People break “little laws more” (at a set of stop signs in NY, stopping went from 38% in 1978 to 1%) • Charitable giving has decreased • Many more signs of breakdown

20. Why? • Many suspects • No one reason • Careful study does remove some possibilities: hard to blame internet when the decline from 1970 is steady

21. Pressures of Time and Money • Heavy time demands are more likely to be active civically and professionally • Busy people spend less time reading books, sleeping, and (particularly) watching TV • Increasing financial anxiety during period, however decreases in engagement even correcting for this

22. Pressures of Time and Money • Full time employment by women (attributable virtually entirely to financial pressures) decreases civic involvement (Porter: “Although the mothers of the current generation of American adults were usually not part of the paid labor force, they engaged in many socially productive functions. As their daughters have assumed a greater share of work outside the home, one might have expected their sons to assume a greater share of other social responsibilities but … that has not happened”)

23. Sprawl and mobility • Rural and small towns have been “hotbed” of activity: now decreasing • More time spent in commute gives less time for other activities. Speed is actually up, which causes formerly self-contained towns to become bedroom communities

24. Television and technology • There are now 2.4 TV sets per household, and the average household watches TV 7.5 hours/day • Isolated and isolating activity that correlates most strongly with other measures of social disengagement

25. TV Usage: “TV is my primary form of entertainment”

26. Causation? • Some interesting studies of 3 northern Canadian communities in the 1970s, one with no TV, one with one channel, and one with five. • Participation in community activities was sharply higher in “no TV” town

27. Generational Shifts • Two ways these changes could come about: uniform across all ages or replacement of “civic generation” with a less civic generation • Data is clearly in favor of the latter. Matches with TV results

28. Relevance to OR/MS Professionals? • Clearly an important issue for society • Bowling Alone received widespread media coverage • Is there special relevance to OR/MS professionals? YES! (I think)

29. Communication with colleagues for Jobs New methods Support Ongoing information Communication externally for Funding Initiatives Professional Growth By our very nature, this bridging social capital is key to our success (“OR waxes and wanes”) Importance of Social Capital

30. Effect of Bowling Alone conclusions • Society membership is a poor measure of importance of an area. OR/MS may be dying, but don’t point to INFORMS membership numbers for support. • Instead, the reverse may be true: OR/MS may be weakened by lack of emphasis on social capital issues (just as many aspects of social welfare are weak in states with little social capital).

31. Effect of Bowling Alone conclusions (cont.) • Societies (including the Roundtable) may likely require more professional support to offset decreased volunteer effort. • Decreased opportunities for “bridging” social capital • Don’t think less of colleagues who don’t join: they are getting to be the norm. • “Mispricing” of social capital opportunities due to lack of experience.

32. Offsetting these effects First step in solving a problem is to recognize one exists. • Recognize social capital as a key component of our professional lives and increase supply • Structured lunch tables at conferences • Additional opportunities for members of our profession, particularly young ones

33. Offsetting the Effects • Increase demand for social capital • Create cohorts of “bonded” individuals within the larger community (viz. the “small group movement”) • Increase rewards and professional recognition for “social capital” activities • Hide social capital activities in other actions

34. Offsetting the Effects • Understand social capital issues in the communities we create (user groups, cross-functional teams, professional societies, etc.) • Do not overemphasize knowledge over interaction • Recognize individual reluctance • Create opportunities

35. Offsetting the Effects • Be leaders in exploiting new technology to create mixed online/live communities • Offset time/ sprawl effects • Look at the “open software communities” and try to extend their success. • Move beyond the “individual” aspects of the web to discover social capital aspects

36. True interaction Illustration Web pages

37. Questions • How does social capital affect your professional life? • What special aspects of life as an OR/MS professional do you see affected by social capital? • What has affected your ability to gain and retain social capital? • What opportunities do you see for generating social capital in OR/MS either globally or in your area? Can you generate both bridging and bonding?

38. Practice Portal Advertisement • Time to get to reception, so: The Practice Portal (Phase 1) is coming together: view it at http://www.informs.org/Practice Talk to (aka “Gain social capital with”): Robin Lougee-Heimer, IBM, AE Practice Matt Saltzman, Clemson, IOL Editor