social capital and organizational commitment

Journal of Business and Psychology, Vol. 16, No. 4, Summer 2002 (2002)

SOCIAL CAPITAL ANDORGANIZATIONAL COMMITMENT

George W. WatsonUniversity of South Florida

Steven D. PapamarcosSt. John’s University

ABSTRACT: Organizational scientists have been investigating the role of hu-man relationships vis-a-vis firm productivity for some years. Recently, SocialCapital has been theorized to play a central part in the reduction of organiza-tional transaction costs. We briefly position Social Capital among several theo-ries claiming a role for interpersonal capital, review its theoretical nuances, andtest this theoretical structure using a sample of 469 sales professionals from aleading medical services firm. Our findings indicate that trust, communication,and employee focus have significant direct and moderate indirect affects on orga-nizational commitment.

KEY WORDS: social capital; organizational commitment; trust; communication;employee focus.

The construct of organizational commitment has received substan-tial research attention. In fact, several extensive literature reviews haverevealed an impressive list of some seventeen significantly related ante-cedents, nine moderating variables, fifteen correlates and eight conse-quences of organizational commitment (Meyer and Allen, 1997; Mathieuand Zajac, 1990; Morrow, 1983; Mowday, Porter and Steers, 1982;Reichers, 1985; and Steers, 1977). Yet, investigations into the social-psychological processes underlying the formation of organizational com-mitment are rare (Mathieu and Zajac, 1990). Such investigations usingcross-sectional data—as does the current study—allow for an under-standing of how antecedents combine to influence organizational com-

Address correspondence to George W. Watson, Department of Management, Univer-sity of South Florida, 10416 Greenmont Drive, Tampa, FL 33626; [email protected].

537

0889-3268/02/0600-0537/0 2002 Human Sciences Press, Inc.

538 JOURNAL OF BUSINESS AND PSYCHOLOGY

mitment and assist scholars and managers in specifying the relative im-portance of the myriad of competing hypotheses.

While research in organizational commitment has advanced, newsocial context theories have emerged. One such theory, Social CapitalTheory (SCT), shows theoretical promise in explaining the social psycho-logical processes that help in developing organizational and individualcompetitiveness through the establishment of interpersonal relation-ships. To date, various forms of social capital theories are being re-searched. Most theoretical and empirical research in organizational sci-ence, however, has conceived of social capital as a network of cooperativerelationships that ultimately benefit the individual (Coleman, 1998;Burt, 1997; Belliveau, O’Reilly and Wade, 1996; Friedman and Krack-hardt, 1997). Within this scheme, the value of interpersonal attachmentsis predominantly located in their ability to advance one’s self-interests.

In contrast, researchers have extended the conceptions of social capi-tal to include it as an attribute of organizations or, other more general-ized collectives such as communities or even societies. According to thesescholars, for example, social capital serves to provide sustainable com-petitive advantages to organizations in the form of entrepreneurial be-havior (Chung and Gibbon, 1997), firm survival (Pennings, Lee and VanWooteloostujin, 1998), and intellectual capital (Nahapiet and Ghoshal,1998). In addition, the argument that social capital is an asset of commu-nities and societies is posited by Putnum (1995) and Fukuyama (1995).Under both meso and macro formulations, however, the ultimate valueof interpersonal relationships reside in their ability to advance the orga-nization’s (and defer the individual’s) interests (Leanna and Van Burren,1999).

Even when there is agreement about the appropriate level of analy-sis, debate persists about the dimensions and social psychological pro-cesses that creates and fosters social capital. Putnum (1995), for in-stance, posits that social capital is built upon a foundation of trust,neighborliness and familial bonds. Others disagree, claiming that: “Put-num’s . . . concept of social capital . . . obscures the specific nature of thesocial capital on which Silicon Valley was built and through which itcontinues to construct itself” (Cohen and Fields, 1999:109).

What these views hold in common is a primary focus on the out-comes of social capital, but they diverge in their treatment of the social-psychological processes that foster it. Further examination of these pro-cesses and their impact on outcomes such as organizational commitment,is important for two reasons. First, through such an examination, it ispossible to begin to reveal the ways that social capital advantages boththe individual and the organization. Second, managers can play a centralrole in the development of those factors that enhance interpersonal rela-tionships that, in turn, affect both the quality of an employee’s work lifeand the competitive posture of the firm.

539GEORGE W. WATSON AND STEVEN D. PAPAMARCOS

It is within this context that the current study examines the factorsand relationships theorized to foster social capital and, in turn, createcompetitive advantages for the firm. Specifically, we investigate whetherone’s perceptions of the quality of social relationships at work (i.e., reli-able communication, interpersonal trust, and positive perceptions of nor-mative frameworks) serve to develop organizational commitment.

We approach this task by first relating the theory of social capi-tal to other theories that claim an important function for interpersonalcapital in organizational life. Through surveying these alternative ap-proaches it is possible to more clearly stake out social capital’s terrain.We then review recent literature in the field in order to develop our hy-pothetical model. The methods used to evaluate these models and theresults achieved through our approach are reported. We close with a dis-cussion regarding the limitations of the present study and we suggestpossible directions for future research.

POSITIONING SOCIAL CAPITAL THEORY

The construct of social capital is among the most recent addition toa family of theories of interpersonal capital that have developed over thepast forty years. Each theory considers distinct social aspects of collec-tive living and emphasizes different social psychological dimensions.These theories insist that interpersonal associations provide dividendsto the people and organizations that invest in them. Furthermore, eachtheory claims that collectives fostering these interpersonal associationsalso derive benefits from them. The nature of these dividends variesamong the theories, as does the normative determination about whatconstitutes an adequate return for one’s contributions (Portes, 1998).Several of the more influential of these theories—social exchange theory,human capital theory, and psychological contracts—are briefly describedbelow in order to position them relative to, and differentiate them withina taxonomy of social context perspectives.

Sociologists, notably Gouldner (1959), have posited that we live in asocial world in which we are repaid for the help or favors we provide toothers. The norm of reciprocating received benefits constitutes the prin-ciple theme in Social Exchange Theory (Blau, 1964). Reciprocity createsa normative bond among people within a collective and instills in themthe obligation to return, in kind, any benefits of membership received bythem. Within the context of this theory people cooperate with each otherunder the expectation that they will, in turn, both require and receiveassistance from others.

Contemporaneously, a related theory emerged: Becker’s (1964) the-ory of human capital. Here the individual is not only the actor in a mutu-ally beneficial transaction, but is also the object that is exchanged be-


cause he or she is the vessel that contains valued knowledge, skills andabilities. Similar to the idea of investing in the productive capacity ofphysical capital, human capital is conceived as an investment in the hu-man resource. Developing human capital means instilling individualswith certain abilities (e.g., the ability to read and calculate math prob-lems). These abilities enable people to perform tasks they otherwisewould be unable to perform. In this sense, human capital is an individuallevel attribute—it is the individual that possesses a productive capacitythat adds value to the raw product. The theory, however, allows for ag-gregating individual human capital so that one collective might be com-pared to another with regard to human capability and capacity.

Rousseau (1995) offers a further elaboration on the theme of inter-personal agreement; implied or psychological contracts. Rousseau con-tributes to interpersonal theories in two important ways. First, unlikethe forgoing authors who have found generalization to be most useful atthe social level of analysis, Rousseau has focused on closed social sys-tems at the meso level—specifically, individuals within organizationalstructures. A closed social system, such as an organization, is itself animportant variable for some social capitalists for two reasons (i.e., Cole-man, 1990). First, interdependencies among members are more specificand acute. Second, although her perspective is highly psychological, one’sobligations to reciprocate are more formalized through the contract met-aphor, suggesting the possibility of formal recourse (e.g., leaving thefirm) or informal retribution (e.g., not putting forward one’s best efforts).

Social Capital

Although no monolithic formulation of social capital theory has de-veloped (Portes, 1998), Coleman’s (1988) version provides a broadly rec-ognized ideal-type form of the theory useful for comparing social capitalwith the forgoing conceptions. For Coleman, social capital exists in inter-personal relationships. Furthermore, social capital accrues to the indi-vidual as his or her stock accumulates in the form of other people’s obli-gations to reciprocate previous favors. So characterized, the dimensionsof social capital include both the quantity and quality of collectable, out-standing social debt.

In Coleman’s view, people resemble savvy brokers more than self-interested bargainers or contractors. Interpersonal relationships arenurtured for their value as a maturing crop that will one day be traded.One’s carefully chosen portfolio of relationships is constructed to weatherthe unforeseen perturbations in our individual circumstances. Similarto Social Exchange Theory and Psychological Contract Theory, with theharvesting of these relationships comes the implied, and normativelysanctioned, obligation to reciprocate. Unlike Social Exchange Theory, So-


cial Capital Theory more explicitly relies upon the sharing of importantinformation. In addition, unlike Psychological Contracts Theory, wheretrust and normative frameworks are relatively durable aspects of an or-ganization’s climate, social capital is constructed and consumed by theindividual members of both dominant and sub-groups. Consequently, someforms of social capital may, in fact, be unhealthy for the larger macro-social structures. Organized crime exemplifies a structure characterizedby rigidly adhered to normative structures which undermine broader so-cial values, ideas and beliefs (Portes and Landolt, 1996).

Similar to other theorists, Coleman acknowledges the central role oftrust. In addition, individuals and organizations still seek advantage,but through who they know, not only what they know. Because humaninteraction is the central aspect of this theory, the reliability of commu-nication assumes the importance previously implied by human capitaltheory. Yet, for Coleman, the importance of communication increases inwhat he refers to as closed systems—those collectives with barriers toentry and exit (e.g., organizations). According to Coleman, closed sys-tems are more likely to foster dependency relationships, trading of fa-vors, and the sharing of normative structures because members are reli-ant upon each other to reach assigned goals and personal objectives. Insum, the normative basis of interpersonal trust, as well as the effectiveflow in communication, assume more determinant roles in Social CapitalTheory. In the following section we examine more specifically the microdimensions theorized to be important in the formation of social capital.

MODELING SOCIAL CAPITAL AND COMPETITIVE ADVANTAGE

Researchers have suggested that various structural, social and psy-chological factors are germane to the development of social capital. Forinstance, Brehm and Rahn (1997) investigated the role of general lifesatisfaction and one’s cognitive ability in the formation of personal socialcapital. In addition, the social-structural, and cultural implications insocial capital are evaluated by Chung and Gibbons (1997). Still othershave theorized that civic engagement (Putnum, 1995), race (Friedmanand Krackhardt, 1997) and socio-economic background (Kawachi, Ken-nedy, Lochner, and Prothrow-Smith, D. 1997) play a role in the develop-ment of these networks. As occurs with many cross-disciplinary researchendeavors, the division of scholarly labor sees some addressing one setof issues, such as those listed above, while others, in the cognitive andrelational dimensions of social capital, for example, continue to makeadvances in their theories.

Moreover, researchers have tended to focus more on the outcomes ofsocial capital than on the processes fostering it. For example, research


has appeared that identifies a role for social capital in firm dissolution(Pennings, Lee, and Van Witteloostujin, 1998), career mobility (Fried-man and Krackhardt, 1997), personal compensation (Belliveau et al.,1996), entrepreneurship (Chung and Gibbons, 1997) and intellectual cap-ital (Nahapiet and Goshal, 1998). Although scholars, most notably Napa-hiet and Ghoshal (1998), have emphasized more objectively measurableconstructs within of social capital formation, it is their more psychologi-cal, cognitive and relational dimensions, which retain our interest in thepresent study, for it is these factors that underlie the psychological pro-cesses in play in the development of social capital. More explicitly, it maybe possible to measure one’s relationships and the importance of each interms of information exchange (e.g., Belliveau et al., 1996), and althoughthis might be interesting it would reflect little upon the social-psycholog-ical dimensions thought to enable these relationships. Figure 1, the hy-pothesized model, depicts our interpretation of how several interpersonalconstructs interrelate to support the development of competitive advan-tages associated with social capital.

Among the theoretical competitive advantages of social capital for or-ganizations is the reduction in transaction costs associated with the devel-opment of efficient forms of economic organization (Burt, 1997; Putnam,1993; Coleman, 1988). For instance, low employee commitment can be ex-pected to generate increased transaction costs. Although these costs mani-fest in various forms, they are more overt in relatively higher recruiting

Figure 1Conceptual Model of Micro Social Capital and Its Influences on Organizational

Outcomes


expenses, absenteeism, training costs and in the opportunity costs accom-panying increased managerial oversight of staffing and performance. In-deed, forms of social capital may emerge with many faces (Leanna andVan Burren, 1999), and in the present study we examine the manifesta-tion of social capital as it appears in increased organizational commitment,particularly as it is described by Mowday and Steers (1979). Organiza-tional commitment, defined as an employee’s involvement in and identifi-cation with the organization (Mowday, Porter, and Steers, 1982), has beenlinked to absenteeism, turnover, recognition, and the formation of expecta-tions (Northcraft and Neale, 1994; Rousseau, 1995). Thus we have empiri-cal evidence that demonstrates as organizational commitment increasestransaction costs are reduced. These reduced transaction costs create com-petitive advantages that accrue to the organization.

In terms of commitment, the benefits to individuals include the feel-ings that they are members of the best possible organization for them,that they are members of an organization that shares similar values andthat they can take pride in the organization to which they belong (Mow-day and Steers, 1979). In addition, material opportunities become acces-sible from knowing people in advantageous positions. Also, individualsbenefit from the experiences of psychological and social affirmation ob-tained through membership in an organization that caters to the welfareof its members (Bourdieu, 1977).

Cognitive and Relational Antecedents

Putnum (1995:72), when recommending further research into socialcapital, argued that “we must sort out the dimensions of social capital,which is clearly not a unidimensional concept.” Nahapiet and Ghoshal(1998) followed through on Putnum’s admonition and have crafted sev-eral theoretical dimensions they believe comprise social capital, but theydid not empirically test these dimensions. Of particular interest to thecurrent study is their conceptualization of the cognitive and relationaldimensions. These dimensions include the constructs of communication,trust and shared norms. These constructs have consistently emergedwithin the rubric of social capital. Indeed, as our propositions unfold wewill posit that the reduced transaction costs that accrue to the organiza-tion as a consequence of increased organizational commitment result, atleast in part, from the social capital fostered by the presence of trust,shared normative structures, and communication.

Cognition and Communication. Nahapiet’s and Ghoshal’s (1998:224) cog-nitive dimension of social capital is defined as “The resources providingshared representation, interpretation and systems of meaning amongparties.” Included within this conceptualization is the manner and effec-


tiveness of communication. Because social capital theories so heavilyemphasize interpersonal interactions, the quality of communication as-sumes a determinant function.

Communicative actions serve at least two important functions.First, the exchange of information transpires along communication link-ages. To the extent that such information is reliable the linkage is morelikely to sustain itself. As information is certainly one of the key com-modities that flow within a network of mutually supporting individuals,information that is unreliable or inaccurate would be expected to reduceone’s inclination to be a member in that network. Second, communicativeactions not only serve to transmit information, they also serve to con-struct our perceptions of meaning and reality itself (Weick, 1995; Pondyand Mitroff, 1979; Berger and Luckman, 1966). The specific values towhich an organization appeals when justifying its actions or laying outits plans, allow us to understand why certain events occur (Weick, 1995),influence our perceptions of organization justice (Cobb and Wooten,1998), and permit us to share the communicator’s perspective. In sum,we suggest that the quality of communication will affect a person’s desireto establish or maintain membership in an organization. Communicativeactions, therefore, will have affects on organizational commitment. Thus,the first hypothesis:

H1: The quality of communication will directly and positively affectlevels of commitment to the organization.

The Relational Dimension of Trust. The relational dimension stressesthe significance of trust in the facilitation of mutually advantageous ex-change (Nahapiet and Ghoshal, 1998). Interpersonal trust is presently aresearch field in itself (e.g., Lewicki, McAllister and Bies, 1998; Shep-pard and Sherman, 1998; Fukoyama, 1995). Trust has been at the centerof theorizing about cooperative and productive interaction for some time(e.g., Barnard, 1938) and, for sociologists, is central to successful socialcooperation (e.g., Homans, 1964). Because we can never be assured thatthe resources we allocate to helping others will ever be reciprocated, weare obliged to trust that they will be (Blau, 1964). Coleman (1988:S103)argues that social capital depends upon this trustworthiness and furtherconcludes that: “without a high degree of trustworthiness among themembers of the group, the institution could not exist.” In support of thispoint, Pennings et al. (1998) found that firm dissolution is negativelyrelated to the inter-relationships that comprise social capital.

The importance of trust and its relationship with other antecedentsof social capital, however, is not yet fully understood. Trust is likely tobe implied as an individual’s willingness toward vulnerability (Rousseauet al., 1998) or by individual perceptions regarding the norm of reciproc-ity. The psychological predisposition toward vulnerability and the sub-


jective perceptions about the norm of reciprocity would be expected todirectly influence one’s commitment to the organization in at least twoways. First, a person that feels particularly vulnerable within an organi-zation should be less attached to it. Second, if one does not trust thatone’s work efforts will be reciprocated in kind, than Social Capital The-ory suggests one is less likely to find one’s associations rewarding, andwill be less committed to them. Therefore, we hypothesize the following:

H2: The levels of interpersonal trust perceived by members will di-rectly influence organizational commitment.

Shared Normative Frameworks. Another of Nahapiet and Ghoshal’s (1998)relational factors is the norms by which people in the organization governthemselves and their interaction with others. These frameworks generallyinform members about what is considered right or wrong, good or bad.Perceptions of shared normative frameworks are second only to trust inbeing broadly recognized as an underlying factor in the formation of socialcapital. Coleman asserted; “When a norm exists, and is effective, it consti-tutes a powerful, though sometimes fragile, form of social capital” (1988:S104). Relatedly, shared norms have also been linked to more effectiveinterpersonal cooperation (Starbuck, 1983). As viewed by Doney, Cannonand Mullen (1998), norms help us to interpret and understand co-workers’behavioral intentions, and predict their attitudinal and behavioral re-sponses. In addition, Ravlin and Meglino (1987) suggested that percep-tions of the organization’s normative structures will have affects on one’scommitment to the organization. Therefore, we hypothesize:

H3: Members’ perceptions of the normative structures of the organi-zation directly affect a member’s organizational commitment.

Of additional interest is the possibility of interaction affects. It isplausible that patterns in responses about trust, communication andnorms will combine to explain variance in organizational commitmentover and above their individual direct affects. This is to argue, for exam-ple that, if a person feels high levels of trust and perceives that commu-nication is reliable, this combination will be as influential in the forma-tion of commitment as the separate affects of each. Thus we hypothesize:

H4: Interaction affects of trust, communication and norms will in-fluence organizational commitment.

METHODS

Sample

The research site is a $1.2 billion medical services firm with officesthroughout the United States. The firm is the largest of its type in its


industry. Nine hundred and eighty nine members of a sales force wereasked to respond to a survey. Each survey was accompanied by astamped, self-addressed envelope for its confidential return to the seniorinvestigator. No names or other identifying mechanisms were used inorder to protect respondents’ anonymity. The survey was also accompa-nied by a cover letter signed by the executive vice president for salesand marketing encouraging participation. The survey was administeredduring the last quarterly meeting of the regional sales forces.

The sample was comprised of sales professionals responsible formaintaining current business levels, developing existing business andestablishing new business. Four hundred and forty six surveys were re-turned for a response rate of approximately 45 percent. Over 25 separategeographic locations were represented in the returned surveys. The re-sponses included virtually all regions in the United States but a majoritywas received from the northeast. Approximately sixty-three percent ofthe respondents were female. The average work experience was eighteenyears, and the average seniority with the firm was about seven years.Approximately 11 percent reported being a member of a minority group.About 51 percent reported themselves as having at least one college de-gree and 55 percent reported their socio-economic background as “aboutaverage.” The age category most frequently reported was between 31 and35 years (25 percent of respondents).

Measures

Organizational Commitment. For the dependent variable the fifteen itemscale called the Organizational Commitment Questionaire (OCQ) devel-oped by Mowday and Steers (1979) was selected for this study. The scalewas selected because it emphasizes one’s likelihood to expend extra ef-fort, take pride in one’s organizational membership, and experience over-all affection for the organization, as well as other similar items that fitclosely with the theoretical thrust of a socially based conception of com-mitment. In this way the OCQ reflects some of the positive aspects ofmembership that a person is or is not experiencing. A sample item is: “Ifind that my values and the organization’s values are very similar.” Theoriginal authors reported Cronbach’s Alpha coefficients ranging between.82 and .93. This coefficient was calculated at .88 in the present study.

Interpersonal Trust. A scale developed by Cook and Wall (1980) calledTrust in Managers was selected to operationalize the trust dimensionbecause it most closely reflects the substance that trust would theoreti-cally offer to the formation of social capital. The Trust in Managers scalecontains six items. A representative item is: “Management can betrusted to make sensible decisions for the firm’s future.” The original


authors report Cronbach’s alphas ranging between .77 and .79. The samemeasure for this study attained .86.

Perceptions of Normative Structures. As Social Capital Theory predicts,Cullen and Victor (1993) found that various dimensions of the organiza-tion’s normative climate affect organizational commitment. We selectedemployee-focus (Trevino, Butterfield, and McCabe, 1998) as one norma-tive dimension likely to influence organizational commitment and onewhich is consistent with the cooperative atmosphere suggested by SocialCapital Theory. A sample item is: “It is expected that each individual iscared for when making decisions here.” Trevino et al. (1998) reported aCronbach’s alpha of .87 for this subscale. In our study this coefficientwas .88.

Communication. O’Reilly and Roberts (1976) developed a scale to exam-ine the relationship between credibility and communication behavior inorganizations. Because credibility is an important aspect of trust andnorms, this scale was believed appropriate for our study. The measureconsists of a sub-scale titled Reliability of Communication. We operation-alized the communication dimension with the reliability sub-scale. Arepresentative item is: “The information I receive is often inaccurate.”O’Reilly and Roberts report Cronbach alphas ranging from .78 to .85.For this study the Cronbach alpha for the reliability sub-scale was .83.

Analysis

In our efforts to understand organizational commitment as it relatesto these dimensions of social capital we examined many possible predic-tors. We grouped these predictors into blocks that included: (1) the demo-graphic characteristics of age, gender, seniority, socio-economic back-ground and work experience; (2) the variables of employee-focus, trust inmanagement, and reliability of communication; (3) the three two productterms of employee-focus, trust in management and reliability of commu-nication and (4) The three product term of trust, communication, andemployee-focus. We then applied blockwise regression analysis using theabove blocks. This analysis was selected in order that we could evaluatethe contribution to R2 attributable to each of groups of variables. Thedemographics block was entered first and stepwise selection was appliedto each characteristic with only those significant predictors retained(probability of F to enter was set at less than or equal to.05 and probabil-ity for F to exit was set at greater than or equal to .10). In the secondstage, testing for hypotheses one through three, the block containingtrust in management, reliability of communication and employee focuswas entered and the same stepwise selection criteria applied to each ofthese variables. To test for hypothesis four we entered the third block in


phase 3. In phase 4, we removed the third block and entered the fourthblock to ascertain whether all terms were interacting. In all cases thesame selection criteria were applied. Results of our analysis follow.

RESULTS AND DISCUSSION

Results

Table 1 lists the means, standard deviations and intercorrelationsbetween the predictor and dependent variables. Significant zero ordercorrelations were found between each of the three predictor variables oftrust in management, reliability of communication and employee focusand the dependent variable of organizational commitment. In addition,there were significant correlations among the predictor variables causingus to question common method bias. To investigate the possibility ofcommon method bias we applied common factor analysis, entering allitems from the predictor and criterion variables. Four eigenvaluesgreater than one emerged and each item loaded as expected onto its re-spective construct. In addition, no one factor accounted for more thanthirty-eight percent (reliability of communication) of the variance. Thisfinding gave us confidence that common method bias was not a substan-tial problem in our data.

Table 2 contains the results of the regression analysis. No demo-graphic variables met the criteria for retention in the first stage of theanalysis. In the second stage, trust in management was selected first forentry and it significantly contributed to the explanation of the variancein organizational commitment (F = 364.735, p = .001). In addition, reli-ability of communication was selected for entry and it also significantlycontributed to the explained variance over and above trust in manage-ment alone (∆F = 12.117, p = .001). Employee-focus was also selected forentry as it added significant additional explanation to the variance

Table 1Means, Standard Deviations, and Intercorrelations Between the Predictor and

Dependent Variables (Cronbach alphas are entered along the diagonal)

Variable Mean SD 1 2 3 4

1. Organizational Commitment 5.45 .925 (.88) .393* .528* .679*2. Reliability of Communication 4.26 1.29 (.83) .294* .494*3. Employee Focus 4.27 1.20 (.88) .654*4. Trust in Management 4.70 1.26 (.86)

*p = .001.


Table 2Results of Hierarchical Regression on Organizational Commitment

Model and Variables R2 ∆R2 F ∆F

1. Trust in Management .478 — 364.735 —2. Plus Reliability of Communication .493 .015 376.852 12.117***3. Plus Employee-Focus .502 .009 383.666 6.814**4. Plus Reliability of Communication × Trust .508 .006 388.498 4.832*

in Management

***p = .001.**p = .010.*p = .050.

(∆F = 6.814, p = .010). In the third stage of the analysis the block of prod-uct terms were entered and stepwise selection was applied to each ofthese. One product term was retained indicating a significant interactionbetween reliability of communication and trust in management in theexplanation of organizational commitment (∆F = 4.382, p = .05). In phase4 we entered the three product term. Although it approached signifi-cance (p = .10) it did not meet the selection criteria.

Varying the order of entry in the above variables did not alter thesignificance of their individual contributions. Moreover, to further ex-plore the overall relationships between communication, trust and em-ployee focus upon organizational commitment, we examined the stan-dardized regression coefficients in the full model (model 4 in Table 2)and collinearity statistics. As for collinearity, the Variance Inflation Fac-tor (VIF) and the Tolerance Values indicated acceptable levels of uniquevariance among the independent variable that provide direct effects.Standardized beta weights allow for a relative comparison of the magni-tude of effect each variable has on organizational commitment. In thefinal model, trust in management (t = 5.622, p = .001, β = .896), reliabil-ity of communication (t = 3.213, p = .05, β = .324), employee focus (t =2.670, p = .01, β = .126), and the interaction between reliability of com-munication and trust in management (t = 2.198, p = .05, β = .465) wereeach significant. As indicated by the standardized beta weights, trust inmanagement is a highly influential perception in one’s reports of organi-zational commitment.

We set out to investigate the serial and aggregate affects of severaltheoretical dimensions of social capital upon a transaction-cost reducingoutcome; organizational commitment. Our objective was two fold: First,to better position social capital theory among the class of theories thatasserts social-psychological advantages in the quality of interpersonalrelationships; and second, to better understand how the theorized di-


mensions of social capital, namely trust, communication and normativestructures, may serve to foster the apparent advantages of social capital.In support of our hypotheses, we discovered that trust in management,reliability of communication and employee focus each positively and sig-nificantly influenced levels of organizational commitment when control-ling for each other. We further determined that patterns of responses inreliability of communication and trust in management combined to ex-plain significant levels of variance over and above the demographic vari-ables and the theorized variables. While we agree that the alternativeinterpersonal capital theories presented in this paper (particularly, psy-chological contracts and social exchange theories) may also explain somevariance in organizational commitment, the data clearly indicate that asocial capital approach to organizational commitment has promise.

Discussion

In future research efforts, a multidimensional measure of organiza-tional commitment may be more useful in revealing which dimensions ofcommitment are most influenced by the factors comprising social capital.For instance, one might expect to find high levels of normative commit-ment and, perhaps, low levels of continuance commitment. This mayhelp us to better understand the nature of the emphasis a person placeson working within an organization that fosters communication, trust,and preferred normative frameworks.

Another area of future investigation builds upon Burt’s (1997) workon the structural factors affecting social capital. In our case we believethat there may have been structural factors influencing the relationshipbetween interpersonal trust and communication that were difficult tomodel. For example, in a national sales force, we reasoned, geographiclocation may be a factor. We also considered that the competitive envi-ronment and the policies leading to reward influence competition in in-teractions. We will integrate these considerations into our future re-search as we seek greater understanding of those linkages that play ameaningful role in organizational life.

Finally, concerns may be voiced regarding the generalizability of theresults reported here given that the sample was over 60 percent female.This highlights one of the dilemmas characterizing research in socialcapital. As Coleman (1988) indicates, the qualities contained within in-terpersonal relationships are more critical in a ‘closed’ system—thoseorganizational arrangements in which there exists a high degree of inter-dependence among members and barriers to entry and exit. Of course,organizations differ with regard to demographic, structural and otherinfluential factors affecting interdependence, and failure to control forthese potential moderating factors may compromise findings and even,


in some settings result in misleading conclusions. We do not believe,however, that this attenuates our results because one approach to over-coming this problem is to examine social capital in a variety of otherclosed organizational systems and thereby more fully and completely ex-plore the possible operative importance of members’ characteristics withregard to social capital, organizational commitment and their relatedconstructs.

REFERENCES

Barnard, C. (1938). The Functions of the Executive. Cambridge, MA: Harvard UniversityPress.

Becker, G. (1964). Human Capital. New York: National Bureau of Economic Research.Belliveau, M., O’Rielly, C. and Wade, J. (1996). Social capital at the top: effects of social

similarity and status on CEO compensation. Academy of Management Journal, 29(6),1568–1593.

Berger, P. and Luckman, T. (1966). The Social Construction of Reality. New York: Dou-bleday.

Blau, P. (1964). Exchange and Power in Social Life. New York: Wiley.Bourdieu, P. (1977). Outline of a Theory of Practice. Cambridge, UK: Cambridge University

Press.Brehm, J. and Rahn, W. (1997). Individual-Level Evidence for the Causes and Conse-

quences of Social Capital. American Journal of Political Science, 41(3), 999–1023.Burt, R. (1997). The Contingent Value of Social Capital. Administrative Science Quarterly,

42, 339–365.Chung, L and Gibbons, P. (1997). Corporate Entrepreneurship: The Roles of Ideology and

Social Capital. Group and Organization Management, 22(1), 10–30.Cobb, A. and Wooten, K. (1998). The Role Social Accounts Play in a “Justice Intervention.”

In R. Woodman and W. Passmore (Eds.), Research In Organizational Change and De-velopment (Vol. 11), 243–295. Greenwich, CT: JAI Press.

Cohen, S., and Fields, G. (1999). Social Capital and Capital Gains in Silicon Valley. Califor-nia Management Review, 41(2), 108–130.

Coleman, J. (1988). Social Capital in the Creation of Human Capital. American Journal ofSociology, (94) Supplement, 95–120.

Cullen, J. and Victor, B. (1993). The Effects of Ethical Climate on Organizational Commit-ment: A Multilevel Analysis. Unpublished manuscript.

Doney, P., Cannon, J., and Mullen, M. (1998). Understanding the Influence of NationalCulture on the Development of Trust. Academy of Management Review, 23(3), 601–620.

Friedman, R., and Krackhardt, D. (1997). Social capital and career mobility. Journal ofApplied Behavioral Science, 33(3), 316–334.

Fukuyama, F. (1995). Trust: The Social Virtues and the Creation of Prosperity. New York:Free Press.

Gouldner, A. (1959). Reciprocity and Autonomy in Functional Theory. In L. Gross (Ed.),Symposium on Sociological Theory. New York: Harper and Row.

Homans, G.C. (1964). Social Behaviour: Its Elementary Forms. New York: Harcourt Brace.Jary, D., and Jary, J. (1991). The Harper Collins Dictionary of Sociology. New York: Harper

Collins.Kawachi, I., Kennedy, B., Lochner, K., and Prothrow-Smith, D. (1997). Social Capital, In-

come Inequality and Morality. American Journal of Public Health, 87(9), 1491–1498.Leanna, C., and Van Burren H. (1999). Organizational Social Capital and Employment

Practices. Academy of Management Review, 24(3), 538–555.Lewicki, R., McAllister, D. and Bies, R. (1998). Trust and Distrust: New Relationships and

Realities. Academy of Management Review, 23(3), 438–458.


Mathieu, J., and Zajac, D. (1990). A Review And Meta Analysis of the Antecedents, Corre-lates and Consequences of Organizational Commitment. Psychological Bulletin, 171–194.

Merton, R.K. (1957). Social Theory and Social Structure (2nd ed.). Glencoe, IL: Free Press.Meyer, J., and Allen, N. (1997). Commitment in the Workplace. Thousand Oaks, CA: Sage.Morow, P. (1983). Concept Redundancy in Organizational Research: The Case of Organiza-

tional Commitment. Academy of Management Review, 8(2), 486–500.Mowday, R., Porter, T., and Steers, R. (1982). Employee-Organizational Linkages. New

York: Academic Press.Mowday, R., and Steers, R. (1979). The Measurement of Organizational Commitment.

Journal of Vocational Behavior, 14(1), 224–227.Nahapiet, J. and Ghoshal, S. (1998). Social Capital, Intellectual Capital, and the Organiza-

tional Advantage. Academy of Management Review, 23(2), 242–285.Northcraft, G., and Neale, M. (1994). Organizational Behavior, 2nd Ed. New York: Dryden.Pennings, J., Lee, K., and Van Witteloostujin, A. (1998). Human Capital, Social Capital,

and Firm Dissolution. Academy of Management Journal, 41(4), 425–440.Pondy, L., and Mitroff, I. (1979). Beyond Open Systems Models of Organization. In B. Staw

(Ed.), Research In Organizational Behavior (Vol. 1, pp. 3–39). Greenwich, CT: JAI.Portes, A. (1998). Social Capital: Its Origins and Applications in Modern Sociology. Annual

Review of Sociology, 24, 1–24.Portes, A., and Landolt, P. (1996). The Downside of Social Capital. The American Prospect,

May–June, 1996 (pp. 18–26).Putnam, R. (1995). Bowling Alone: America’s Declining Social Capital. Journal of Democ-

racy, 10(January), 24–35.Ravlin, E., and Meglino, B. (1987). Issues of Work Values Measurement. Research in Cor-

porate Social Performance and Policy (Vol. 9), 153–183.Reichers, A. (1985). A Review and Reconcpetualization of Organizational Commitment.

Academy of Management Review, 10(2), 465–476.Robinson, S. (1996). Trust and Breach of the Psychological Contract. Administrative Sci-

ence Quarterly, 41(3), 574–599.Rouseau, D. (1995). Psychological Contracts in Organizations: Understanding Written and

Unwritten Agreements. Thousand Oaks, CA: Sage.Rousseau, D., Sitkin, S., Burt, R., and Camerer, C. (1998). Not So Different Afterall: A

Cross Discipline View of Trust. Academy of Management Review, 23(2), 393–404.Sheppard, B., and Sherman, D. (1998). The Grammars of Trust: A Model and General

Implications. Academy of Management Review, 23(3), 422–437.Starbuck, W. (1983). Organizations as Action Generators. American Sociological Review,

48(1), 91–102.Steers, R. (1977). Antecedents and Outcomes of Organizational Commitment. Administra-

tive Science Quarterly, 22, 46–56.Trevino, L., Butterfield, K., and McCabe, D. (1998). The Ethical Context of Organizations:

Influences on Employee Attitudes and Behavior. Business Ethics Quarterly, 8(3), 447–476.

Weick, K. (1995). Sense Making in Organizations. Thousand Oaks, CA: Sage.

social capital and organizational commitment

Documents