It's Who They Know Not What They Know When It Comes To Employee Turnover

Have you noticed how the most effective employees are the ones who have the best relationships with other employees across the company? These employees with high "social capital" can speed a vendor contract through the legal department or get IT to fix a nasty bug in the HRIS without delay.

I have been thinking about this after reading new research on how the loss of social capital through employee turnover negatively impacts organizational performance and effectiveness. Management researchers at the University of Kentucky found that even in companies with low turnover, the loss of those employees with deep social networks had a much stronger negative influence on company performance than turnover among less embedded employees.

The study also pointed out that employees with high social capital are not always managers or supervisors as one might expect. Lower level employees who know a great number of other employees in the organization can hold much of the social capital that bind a company together.

It's a good reminder to both encourage the formation of social networks among employees and also to pay particular attention to retention of those employees that hold the greatest social capital.