Social and cultural capital

Universities may be considered knowledge-intensive organisations consisting of specialists and professionals. The university may be seen as “a social organisation affecting the functioning of economic activity” (Coleman 1988, 97). Social and cultural capital is embedded within universities as I discuss in Chapter 6 and demonstrate in the trust management model in Chapter 7.

Unlike the other forms of capital, such as physical and human capital (skills and knowledge), “social capital inheres in the structure of relations between actors and among actors,” (Coleman 1988, 98). Cultural capital refers to organisational culture as “the way of life in an organisation” (Hatch 1997, 204). Organisational culture displays it visible forms as “artefacts” and non-visible forms consisting of values (Schein 1985, 14). According to Sztompka (1999, 15), trust is a crucial element of social capital, and an important, though implicit, dimension of cultural capital.

The social and cultural capital that is attached to a university organisation, within the people in it, may be referred as intellectual capital. Intellectual capital

is defined by Choong (2008, 613) as being “a non-monetary asset without physical substance but it possesses value or it can generate future benefits.” Thus, intellec-tual capital is essentially, as Nahapiet & Ghoshal (1998, 245) note, the knowledge and knowing capacity, an expertise, of a social collectivity, such as a university organisation. Ultimately, intellectual capital is a social artefact and knowledge and meaning are always embedded in a social context – both created and sus-tained through ongoing relationships in such communities (Nahapiet & Ghoshal 1998, 253).

Social capital is created in an organisation where there is trust and reciprocity, as Savolainen (2011, 119) notes. Social capital exists in relations among persons and comes about through changes in relations between persons (Coleman 1988, 101). Just like physical capital and human capital facilitate productivity, social capital does as well. Unlike other forms of capital, social capital is owned jointly by the parties in a relationship (Nahapiet & Ghoshal 1998, 244). The result is that most forms of social capital are created or destroyed as by-products of other ac-tivities (Coleman 1988, 118). I discuss trust in Chapter 3 and the trust development process in Chapter 4 in more detail.

Trust is one of the basic elements within social capital (Putnam 1993) (Sztompka 1999, 15; Ilmonen 2000, 22). Trust enhances cooperation and eases coordination and communication within organisations. As a consequence, the reciprocity between people in organisations is strengthened. The “norm of reciprocity”

(Coleman 1988, 98) strengthens the sense of communality and common identity within an organisation. All this, on the other hand, further strengthen trust in an organisation (Ilmonen 2000, 22).

Trust does not appear or develop in the organisation in a vacuum, as Ilmonen (2002, 22) states. The interaction between people is needed in order to trust to develop. Information and knowledge about other person or party is gathered through interaction. The trustworthiness of the other party is evaluated on the basis of the gathered information, as I discuss in Chapter 3. However, trust in the other party may not be forced, as Ilmonen (2000, 22) notes.

I discuss in chapter 6, how two university organisations with similar external environments and similar origins although having different administrative cul-tures are able to become one. As Nahapiet & Ghoshal (1998, 257) note, time is im-portant for the development of social capital in an organisation, since it depends on the stability and continuity of the social structure. Therefore, the formation of a common organisational culture incorporated with trust may assist in the creation of social capital.

Organisational culture is defined, e.g. by Edgar Schein (1985, 9) as: “a pattern of basic assumptions – invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integra-tion – that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.” There may be certain patterns of behaviour in an organisation that work in a ‘taken-for-granted’ –manner in relation to the organisation itself

and its environment. Schein (1985, 6-7) argues that these assumptions and beliefs are learned responses for an organisation in order for it to survive in its external environment and for its internal integration. They come to be taken for granted because they solve those problems repeatedly and reliably. This deeper level of assumption has to be distinguished from the “artefacts” (an organisation’s con-structed physical and social environment) and “values” that are manifestations of the culture but not the essence of the culture.

Trust may be seen as a cultural rule. Thus, trust is the property of an sation as a cultural whole. If the rules demanding trust are shared by an organi-sation, and perceived as given and external by each member, then they exert a strong constraining pressure on actual acts of giving or withdrawing trust. There are normative obligations to trust and there are normative obligations to be trust-worthy, credible, and reliable. Therefore, there are social roles related to trust in an organisation, demanding specific conduct from their members, and eventually forming the cultural capital of the organisation (Sztompka 1999, 66).

Organisational values are incorporated within organisational culture and in the social and cultural capital within the organisation as Savolainen (2011, 132) notes. Organisational values reflect what “ought” to be, as distinct from what is, as Schein (1985, 15-17) states. Many values remain conscious and are explicitly articulated because they serve the normative or moral function of guiding the members of the organisation in how to function in certain situation. Such values will predict much of the behaviour. In relation to trust development, the predict-ability of behaviour enhances trust (Mayer et al. 1995, 713-714).

If there is trust within an organisation, Savolainen (2011, 133) notes, it shows in a more positive work orientation, and in the willingness and readiness to co-operate, which contributes to form intellectual capital. There should be space for conversation, action, and interaction in order for the required codes and lan-guage to develop inside an organisation. Organisational life is characterised by a substantial amount of conversation: in meetings, conferences, and social events.

Instead of considering this conversation a waste of time, it can be viewed as a collective investment strategy for the institutional creation and maintenance of solid networks of social relationships (Nahapiet & Ghoshal 1998, 258).

Since it takes time to build trust, relationship stability and durability are key network features associated with high levels of trust and norms of coop-eration. Mutual obligations should be visible and clear (Nahapiet & Ghoshal 1998, 257). Social relationships are generally strengthened through interaction but die if not maintained. Social capital increases rather than decreases with use. Interaction, thus, is a precondition for the development and maintenance of solid social capital (Bourdieu 1986, 250), cultural capital and thus intellec-tual capital (Nahapiet & Ghoshal 1998, 257- 258). In the context of two merg-ing organisations, trust buildmerg-ing, and formmerg-ing social and cultural capital in an organisation, may contribute to a decent level of post-merger integration and organisational competitiveness.

2.3 MANAGERIAL LOGICS OF UNIVERSITy MANAGEMENT