What Remote Work Impact on Social Capital?

It will be some time before we can assess the permanent impact on work patterns post-Covid, though the conventional wisdom is that there will be less “in the office” work and more flexibility about the balance of “in office” and “from home” patterns; less business travel and more substitution of conferencing, as some have recommended or predicted for several decades. 

Social capital is the issue. Social capital includes "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively,” Wikipedia says. “It involves the effective functioning of social groups through interpersonal relationships, a shared sense of identity, a shared understanding, shared norms, shared values, trust, cooperation, and reciprocity. 

Most of us would argue those are important underpinnings of organizational success. And loss of social capital therefore becomes an issue when remote work is the norm. It simply is not clear that the same amount of social capital can be created or maintained in a fully-remote organization. 

Many important debates will happen around the impact of remote work and use of communications as a substitute for travel. Will productivity be affected, positive or negative? What else in the business model could change? Will firms need less office space, the same or possibly even more? The latter might seem an inconceivable outcome, but if economies and firms keep growing, they should require more office space, no matter how work patterns are changed. 

One key issue, assuming there is a permanent shift to remote work, is the impact on the soft and subtle values of face-to-face collaboration. Our expectations about what facilities such interactions can be quite wrong. Consider the thinking behind “open office” floor plans.

In “The Truth About Open Offices,” Ethan Bernstein and Ben Waber, the president of Humanyze, a workplace-analytics firm, tracked face-to-face and digital interactions at two Fortune 500 companies before and after the companies moved from cubicles to open offices. 

“We found that face-to-face interactions dropped by roughly 70 percent after the firms transitioned to open offices, while electronic interactions increased to compensate,” they said. In other words, open offices actually decreased face-to-face interactions, in the same office settings. 

People began to retreat, using electronic communications instead of physical contact, inside the same office spaces. So the virtual workplace, instead of complementing the physical one, had become a refuge from it.

We do not yet know what might happen to the social interactions--or social capital--between people inside firms where virtual work sites are the norm. Weaker bonds between people are a possible outcome. What impact that could have on firm success, productivity or innovation is yet to be determined.