Marco Conceptual

The notion of social capital has become popular in a wide range of disciplines. The definition of the concept of social capital is complex which has been referred and illustrated with different explanations and meanings throughout the literature. The definitions of social capital vary based on relations between actors, structure of these relations, internal and external types of linkages among actors (bonding, bridging, and linking), dimensions, etc. (Adler and Kwon 2002). Cohen and Prusak (2001) define social capital as follows: ―Social capital consists of the stock of active connections among people: the trust, mutual understanding, and shares values and behaviors that bind the members of human network and communities and make cooperative action possible‖ (p. 4). Putnam (1995) remarks social capital as a way that allows all participants to take collective actions more effectively in pursuing their shared goals through features of social life networks, norms, and trust. Similarly Lederman et al (2002) define social capital as

―...set of rules, norms, obligations, reciprocity, and trust embedded in social relations, social

structures, and society‘s institutional arrangements that enable members to achieve their

individual and community objectives.‖ Consequently, it is safe to argue that interpersonal trust is a product of social relations within the organization.

As Halpern (2005) notes, social capital is a buzzword among political and academic elites; however it is unclear for many people. This phenomenon is widely used by social scientists from different fields. This situation leads some kind of confusion for the people who are not familiar with the term. The term capital is defined by Merriam-Webster dictionary as

―accumulated goods devoted to the production of other goods‖. Social capital is considered as a type of capital same as financial, physical, human, and other tangible capitals. Social capital, in general, is related with the daily networks that we are involved. More in details, social capital could be defined by its function. It is not surprising to see that sociology, economics, political science and other sciences bring their own definition of social capital.

Halpern (2005) identifies intersection of the different components used by different fields of interest. He mentions three basic components for social capital: networks; norms, values, and expectations; sanctions. Networks, in general, are the relationships and connections that

individuals have in their ecologies. Social norms are the rules, values, and expectancies that characterize the ecology or community that people are embedded to. These unwritten regulations ensure the continuation of the relationship and networking among individuals. Social trust, organizational culture, or moral values can be classified under this component of social capital.

Third component sanctions are usually informal way of punishment for individuals who break

the law violated the social norms. The punishment usually occurs as decline in the reputation of violators if not exclusion from the network (Halpern, 2005).

Social capital can be defined as a structure of relations between actors, connections and networks among individuals and organizations which comprise reciprocal trust, norms, values and behaviors (Coleman 1988; Adler and Kwon 2002). In other words social capital can be explained ―through changes in the relations among persons that facilitate actions‖ (Coleman, 1988, p.100). Compared to physical capital and human capital – social capital is relatively less tangible and observable which means that it is embodied more to the relations among actors (Coleman 1988).

In one of the commerce speeches Laurence Prusak (IMB CEO) states that any progress happens if you don‘t trust people (Prusak, 2010). He argues that trust in an organization is a perfect lubricant for corporate efficiency which avoids tons of needles monitoring, bargains and negotiations. Today, the same waste of time and resources is on the agenda in KNP. Because of distrustful environment in KNP high rank officers pressure their subordinates and try to keep them under control. These circumstances deeply affect officers‘ mood and organizational performance.

Leana and Van Buren (1999) were first who introduced organizational social capital and considered it as a substitute for leadership in organizations. Leana and Van Buren (1999) see organizational social capital as an investment that benefit both organization and employees which is realized by employees‘ cooperative aspirations and reciprocal trust. However, scholars are still not in consensus on weather trust is a consequence or antecedent of collective action (Leana and Van Buren, 1999). Resilient trust in contrast to fragile trust is based rather on

experience with other workers or management about their moral integrity (Leana and Van Buren, 1999). In many different fields the employee involvement, training and flexible deployment and labor management have been related with performance improvements, cost savings, and product quality enhancements (Leana and Van Buren, 1999). Leana and Van Buren (1999) state social capital ―…with its emphasis on collective identity and action and its reliance on generalized trust, rather than formal monitoring and economic incentives, should facilitate the adoption and effectiveness of flexible or high performance work practices‖ (p.548). Moreover, Watson and Papamarcos (2002) discover in their studies that trust in supervisors, reliable communication and employee focus are significantly influence the level of organizational commitment.

Consequently, it is safe to argue that participation, empowerment, feedback and other collective actions are in organizations more or less influence trust and commitment.

Cohen and Prusak (2001) state that social capital in organizations is a bridge that makes those organizations more than a collection of people that aim to reach their individual goals. The characteristics and indicators of social capital are high level of trust, strong personal networks, energetic communities, shared understanding and equal participation in joint activities (Cohen and Prusak, 2001). They argue that social capital in organizations supports collaboration,

commitment and coherent organizational behavior. Cohen and Prusak (2001) argue social capital necessitates organizational investments, such as demonstrating trust, effective communication and equal participation. Consequently, it is safe to argue that social capital reflects the conceptual framework of this study in terms of influence of participation, empowerment and feedback on interpersonal trust and organizational commitment. Moreover, Bolino et al. (2002) state that social capital enhances organizational performance.