Social Capital, Computerization and the Internet:
Implications for Work and Education. The Gift of Society.
Pruijt, H. (1997). Social Capital, Computerization and the Internet: Implications for Work and Education. The Gift of Society. M.-J. d. Jong and A. Zijderveld. Nijkerk, Enzo Press: 63-73.
Introduction
To sustain a society, its inhabitants must be able to overcome the dilemmas of collective action - cooperating at the risk of being exploited versus muddling through alone at impossible tasks that would be light work when tackled collectively. The capability to overcome these dilemmas is social capital. Associations and networks, particularly voluntary and horizontally organized, and trust as a social lubricant, are its prime components. Like economic capital, social capital can be built up over time. The concept has its roots in classical sociology. In the late 1990’s, partly as a result of an important book and provocative articles by Robert Putnam (1993a, 1993b, 1995, 1996), it has been adopted in the US across a wide political spectrum as a panacea for all that seems dysfunctional in society: failing education, industrial decay, crime, racial tensions etc. And in Japan, the MITI (Ministry of International Trade and Industry), capitalizing on the metaphorical qualities of social capital, makes it the object of industrial policy. In order to create "dynamic regional societies" it plans to build "high quality and advanced social capital for research and development" (MITI 1996).
Social capital, work and computerization
In current Western organizational practice, social capital seems to play a modest role. Many companies treat workers as a flexible commodity rather than as an asset. A case in point is a plan by Dutch steel company Hoogovens to lay off 3000 workers and hire 1000 young, well-educated workers in their place (NRC-Handelsblad 13-2-1997).
Often, flexibilization takes the form of polarizing the organization into an elite core on the one hand, in which mutual trust and commitment, co-operation, autonomy and learning are fostered, and a flexible periphery on the other hand. This periphery consists of permanent workers in dead-end jobs, living under a constant threat of being made redundant, workers on flexible contracts and outside or self-employed workers hired on an hourly basis. Increasingly, workers are being told that lifetime employment is a thing of the past, while at the same time signs of age discrimination on the labor market are rampant.
In many ways, computerization poses a threat to the role of social capital in the workplace:
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Without computerization, increased flexibility demands might steer managers away from centralist planning. However, sophisticated planning systems allow managers to combine flexibility with centralist control. For example, Huys, Sels and Van Hootegem (1995) found that Belgian car plants acquired the capability for flexible adaptation, but not through discussions among workers. On the contrary, it was sophisticated planning that produced flexibility. Furthermore, management was pushing towards enhanced predictability and uniformity of actions.
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Automation gives rise to ‘informatization’: actions leave a trace of computerized information, which can be audited and monitored (Zuboff 1988). Without computerization, low-trust relations tend to generate high management and transaction costs. Information technology can be used for decreasing these costs, thereby preserving low-trust arrangements (Pruijt 1997).
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In the service sector, the refuge of much human employment after the technology driven shake-downs in agriculture and industry, automation is finally getting steam (cf. Laudon and Laudon 1996: 164—165). The resulting job insecurity damages trust relations in the workplace.
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Managers are flocking to the gospel of Business Process Re-engineering. Hammer and Champy (1994: 32), who launched the term, describe it as "the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed." It involves a wide range of possible solutions, which include the use of knowledge based information systems to replace "highly trained" specialists with "generalists" (Hammer and Champy 1994: 38), "triage" (i.e. splitting off difficult cases and assigning these to specialists) or in a decentralized organization, using centralized computer controls. As Head (1996) argues, successful Business Process Re-engineering together with Lean Production, (cf. Womack et al. 1990), does not only lead to job losses but also to loss of skills. He sees it as an explanation for the combination of increasing productivity and stagnating middle-class incomes in the US. He cites Felix Rohatyn, the senior partner of the Lazard Frères investment bank: "What is occurring is a huge transfer of wealth from lower skilled, middle-class American workers to the owners of capital assets and to a new technological aristocracy with a large element of compensation tied to stock values" (Head 1996: 47).
Thus, the computerization of society makes possible an expansion of the role of economic capital at the expense of social capital. Are there identifiable forces that might prevent this?
Counter forces
Available evidence suggests that low unemployment is a strong booster for social capital. Low unemployment means that employees have the option to avoid degrading jobs. In the 1960’s, for instance, when there was full employment in the Netherlands, Philips faced high turnover rates for assembly line workers. This prompted Philips to start experimental reforms, that in some cases developed into team-working (Teulings 1977: 220). This phenomenon disappeared as unemployment soared in the 1970’s. In Sweden, however, full employment remained throughout the 1970’s and the 1980’s. There, the unemployment figure for 1970 was 1.5 per cent. For 1986, it was 2.7 per cent. Labor turnover, absenteeism and recruitment difficulties led Volvo management to search for alternatives for the assembly line in car production. In the early 1990’s, recruitment problems prompted Japanese car companies to introduce reforms (Benders 1996).
Also we find deliberate policies directed against low-trust employment relations. In some organizations, innovative managers, staff personnel and union groups are creating alternatives. Examples are de-coupling workers from the assembly line, setting-up semi-autonomous teams, sometimes with rotating team leadership and decentralization of detail planning to the shop floor level. The innovators receive support from researchers who, combining consultancy and research, accumulate expertise on changing working life and feed this back into organizations. National unions have supplemented their bread-and-butter activities with involvement in the organization of work. So did politicians, who, in several countries, pressed for working life legislation that covers work organization as much as health and safety. And in Scandinavia and Germany, there are state-sponsored research and development programs that explore alternative forms of organization. These programs include efforts to develop technologies that could support change in organizations.
This counter movement was in part driven by recruitment and turnover problems. However, it survived when unemployment rose. Attaining flexibility was a continuing motive. Stress caused by low-trust employment relations, both for employees and managers, was a driving force as well. An analysis of 150 cases based in Scandinavia, the UK, the Netherlands and Germany showed that it is possible, with monumental effort and a lot of ingenuity, to achieve real change on the shop floor level. However, a notable proportion of the organizations later regressed to a more hierarchical pattern. This happened to several organizations that in the literature have become known as successful innovators (Pruijt 1997).
Also, the traditional role of labor unions as self-protection organizations is not over. In the Hoogovens case, for example, two months of negotiations between the management and the unions led to the adoption of a scheme to reduce the number of old workers without forced redundancies.
However, it is also possible to locate a counter force inside the field of information technology itself.
The Internet is social capital
The Internet phenomenon has been hard to pin down. Various metaphors have been tried, and have been found to fail (cf. Stefik 1996). The Internet is not material. It is not the physical links on which data packets travel. The Internet does not own anything. Neither is the Internet owned by anyone. It is a set of values, procedures and practices directed at a goal, in short: an institution. Its goal is to be a network that connects networks. The basis is not a technology, but a set of protocols or standards: agreements on how to structure packets of data, and on how to route these packets from node to node around the world. The Internet standards allow users to send information to any computer on the net, to open up computers for delivery of information and to accept commands given from remote computers. The Internet is run cooperatively by various government agencies, member networks, private carriers and The Internet Society, a non-profit professional association. One of its bodies is the Internet Engineering Task Force, a voluntary group that coordinates technical matters. The standards evolve constantly, through what is known as RFC’s, requests for comments (cf. Hoffmann 1995). This evolution leads to steadily extended functionality. Apart from standards for technical behavior, there are standards for social behavior, the "Netiquette", which are explained in beginner’s books (cf. LaQuey 1993, 69-73). These standards evolve to accommodate new phenomena, such as autonomous software agents (Helmers and Hoffmann 1996). A second Internet Organization worth mentioning in the context of social capital is the "Electronic Frontier Foundation", which was founded to "help civilize the electronic frontier; to make it truly useful and beneficial to everyone, not just an elite; and to do this in a way that is in keeping with our society’s highest traditions of the free and open flow of information and communication" (in: LaQuey 1993: 126).
Giving is a vital element in Internet culture. The necessary software components tend to be contributed free or as shareware. A lot of voluntary work goes into preparing free electronic newsletters.
A look into history makes clear that the current Internet was envisioned by a few people, but that it was never designed or planned (Rheingold 1994). At this point, the conclusion seems hard to escape that the Internet is social capital -- the emergent information society spawned its own social capital.
Social capital, when put to use, generates more social capital. We will see whether this is true in the case of the Internet, but first a few obstacles need to be dealt with.
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In the middle 1990’s, the Internet was over-hyped as a super-library that would instantly produce anything someone would want to know. After over-hyping, a backlash is inevitable. This is nothing special. Innovations tend to be over-hyped. In the 19th century, the cheap mass produced six-shooter was supposed to promote equality in the US. In the early 1960’s, it was believed that nuclear power would be ubiquitous. In the early 1980’s, primitive personal computers were sold as powerful tools. The task at hand is to cut through the hype and through the backlash discourse as well.
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Debating the current content of Internet information, for example the percentage of pornographic traffic or uncivilized language, is not too interesting. The Internet is a case of "the medium is the message" (cf. McLuhan 1964). Traditional mass media follow a one-to-many model, the Internet follows a fundamentally different communication model: many-to-many. Every user can "broadcast", since sending a message to one person is as easy and inexpensive as sending it to a thousand subscribers of a mailing list. The World Wide Web makes it easy to create publications that are accessible to every Internet user.
Possible downsides
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Portes and Landholt (1996) warn against seeing social capital as an unmixed blessing. One of their points is that networks can serve as mechanisms for social exclusion. This seems not to apply to the Internet. The resource commanded by the Internet, digital information, can be endlessly distributed without being depleted. This means that at least one incentive for exclusion, guarding limited resources, is not there. Furthermore, the ethical formula of the Internet requires participating organizations to help connect other organizations. Newcomer entry is eased, not only by a flood of books and magazines, but also by "FAQs" (files of Frequently Asked Questions and answers) on thousands of subjects. Generally, networks cultivate language games that tend to exclude outsiders. The Internet is no exception, but it also provides a jargon file for puzzled users. Apart from this, one finds many more examples in which the Internet itself provides the infrastructure for learning. Internet ideology is non-exclusive. However, there is a trade-off here. A famous example of the role of trust is that of Jewish diamond traders in New York who save lawyer’s fees by trading informally (Coleman 1990: 109). This level of trust is possible because it is a closely-knit community. The openness of the Internet, however, leads to a low level of trust. Organizations have to deploy "firewall" software to prevent visitors from accessing non-public information or even taking control. (Firewall software stops all traffic unless from specific, trusted locations.)
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The Internet supports destructive forms of social capital such as criminal organizations and neo-nazi groups. One could argue that illegal organizations, since they conform to the image of the virtual organization, could derive extra value from the Internet.
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Internet use might come at the expense of community based civic engagement. Meeting electronically might not be equivalent to meeting face-to-face (Putnam 1995: 76). This all depends on where Internet use cuts into the time budget. If it comes at the expense of TV watching, the prime destroyer of social capital (Putnam 1996), there is no downside at this point. On the contrary, many cities have "Free"-Nets" or "Digital Cities". These are attempts to use the Internet for strengthening local communities (Schuler 1996).
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Seeing the Internet as social capital might almost be nostalgia. We might be seeing big economic capital moving in and transforming it to a hierarchically controlled system with a one-to-many architecture. Or in other words, a one-way vertical phenomenon like television (Weingarten and Overbey 1995: 19). Already, managerial observers are lamenting the "economic irrationality" of the present Net. In the US and in Canada, Internet activists are contesting government policies to hand over most of the control over the bandwidth of the to be created National Information Infrastructure (or digital superhighway) to private capital (Moll 1996).
The Internet as social capital in the workplace
It will be hard to question the value of the Internet for practical information retrieval. However, the question at issue now is whether the Internet - alongside other forces - can boost social capital in organizational practice. This means that we will look at the Internet as a means for community-building.
To observe Internet-based social capital at work, it is convenient to start looking in an area where a lot has been accumulated already. Computer professionals were among the first categories of people who started using the net. Therefore, I will concentrate on the communication among computer professionals.
Usenet News carries a few thousand newsgroups on different subjects. Some of these newsgroups exhibit a more than passing resemblance to the inside of men’s lavatory doors in schools. In the professional newsgroups however (for example: comp. databases.ms-access), substantive technical discussion takes place. Participants post technical queries, generally on day-to-day technical problems that could not be solved by asking coworkers. Answers tend to come quickly. Other postings raise debate. These debates consist of a string that may be twenty or thirty postings long. (Noise postings occur in all newsgroups. Anyone can post anything. All that serious users can do against noise postings is protest.)
The debates in the newsgroups are not inconsequential. In 1994, a user discovered a bug in the Intel Pentium processor. This information was made public in the comp.sys.intel newsgroup, leading to a wide debate. Intel spokespeople tried to downplay the problem. However, mounting users’ protests caused Intel to adopt a replacement policy costing $ 475 million.
Usenet postings carry e-mail addresses. Therefore, conversations can go on in private. This makes it possible to connect to people with similar interests. Electronic newsletters help bond "virtual" communities that develop in this way. This can support workers who want to preserve their professional identity in the face of divide-and-conquer organizational politics. From studies on elites (for example Helmers et al. 1975), we know that the top people are usually "well connected", they know the right people in other organizations. Workers who are lower down in the hierarchy tend to lack those connections. Isolated workers struggling with some problem can use the Internet search engines, like AltaVista, to find people anywhere who would be likely to be dealing with the same problem, in order to share their experiences. More and more, users are creating personal homepages on which they state their professional and other interests. In this way, they increase the chance for getting in touch with people who share their interests.
A strong demonstration of the potential power of on-line communities is the ongoing co-operative development of the Linux operating system. (An operating system is a master control program. Examples are UNIX and Windows.) Programmer Linus Torvalds donated the basis to the Internet community in 1991. Since then, programmers around the world contributed bits and pieces (Helmers and Seidler 1994). The resulting - free - product won acclaim in the authoritative trade press (cf. Mohr 1997) and is being put to professional use around the world.
There is no reason why this level of Internet communication and community building should be restricted to computer professionals. Workers in all trades can benefit by connecting to their peers in other organizations (and in their own organization as well). Zuboff (1988, 362—386) described how workers in a drug company used a computer conference system. She concluded that "Knowledge displayed itself as a collective resource; non-hierarchical bonds were strengthened; individuals were augmented by their participation in group life; work and play, productivity and learning, seemed ever more inseparable." (Zuboff 1988, 386). Pliskin (et al. 1997) showed how e-mail was used by striking Israeli academic staff members to enhance cohesion. Lee (1997) gives scores of examples of Internet use by unions around the world, such as on-line strike newspapers, on-line discussion groups for members and inter-union communication (cf. Taylor 1996). Thus, while many aspects of computerization have a negative effect on the role of social capital in the workplace, the Internet has potential to become a counter force.
Implications for education
The implications for education are twofold. The first implication pertains to the opportunities for overcoming worker isolation: Internet use in education should not be restricted to information retrieval. Students at all levels should be encouraged to use the Internet for connecting to other people. They should also be able to make their own presence on the Internet. For instance, this means personal home pages for students and assignments that require students to locate fellow-students in other schools to cooperate with.
As Fukuyama (1995) has pointed out in his inquiry into the wealth of nations, two-way relations of trust between managers and workers – in the form of efficient team working -- are likely to develop when workers are highly skilled, and have high levels of knowledge and professional pride. Involving students in the accumulation of social capital through the Internet is one step in this direction.
The second implication relates to the risks caused by computerization, which as we have seen in many ways reinforces low trust organizational patterns: serious technical training is required for students across a very wide range of fields. In order to be assets to their companies, workers need to be capable of innovation. In the information age, intimate knowledge of information technology is a precondition for innovative capacity. Contrary to popular belief, successful innovation often does not come about because someone states a business problem or an organizational problem, and then finds a technical person to work out a solution. It is rather the other way around. As Hammer and Champy argue, required is "the ability to first recognize a powerful solution and then seek the problems it might solve, problems the company probably doesn’t even know that it has." An example of such a solution is database technology. Streamlining bureaucracies yields modest gains unless one realizes that database technology can eliminate the transportation of information from one desk to the other.
In depth technical knowledge is required for being able to recognize these solutions. In depth technical knowledge also strengthens the position of the worker. As Braverman (1974: 444--445) put it: "The worker can regain mastery over collective and socialized production only by assuming the scientific, design, and operational prerogatives of modern engineering; short of this, there is no mastery over the labor process." The idea is that workers who have an intimate knowledge of information technology are less likely to become victims of skill loss due to automation.
A possible objection against learning computer science in schools is that soon, computers will become so user-friendly that no special knowledge is required to make them do what we want. However, it seems that the development of user-friendly interfaces reached a plateau. Apple Computer reached this plateau in the 1980’s and since then made little progress. Intel-based computers are now at the same level. Negroponte (1995), the director of MIT’s media lab - where pioneering work on user interfaces was done and is still being done - foresees computers with anthropomorphic interfaces consisting of intelligent agents. As of yet, such claims of artificial intelligence are still not proven. The computer remains a machine that manipulates symbols according to programs written in a formal language. The key thing that artificial intelligence research did not achieve is making computers understand humans. A case in point is chess playing programs. The strongest chess program can beat 99,9999 per cent of all human players. Nevertheless, this program lacks all concepts of strategy. Once researchers abandoned the idea of creating chess programs that think like humans, progress towards more powerful programs started to accelerate (Campbell 1997). In the area of natural language processing, creating some form of understanding proved to be the bottleneck (Kurzweil 1997). The gulf between formal language and human meaning has yet to be crossed. The verdict is still out as to whether this is theoretically possible at all (cf. Searle 1990). But, suppose that it will work someday. Humans are not exactly "user friendly"; the power of dumb but fast symbol processing machines will continue to be harnessed towards unpredictable purposes.
The digital economy and inter-networking pose threats: jobs can be created anywhere, irrespective of where the market is; everything needs only to be created once, which means that windows of opportunity close fast. Seizing the opportunities provided by the digital economy means saving employment. As we have seen, full employment boosts social capital in the workplace. Having the educational resources in place early on is a factor for success. A case in point is William Henry Gates III. In 1968, aged thirteen, he learned programming using computer resources that were available at the private high school he was attending (Gates 1995: 1—3). This was two decades before many schools acquired the resources for teaching creative computer skills.
A strong cultural factor inhibits the widespread appropriation of knowledge about information technology. This is the continuing, age-old dualism between the two cultures of science and technology on the one hand, and intellectual and artistic culture on the other hand (cf. Snow 1964). Negroponte (1995: 82) sees multimedia as the area where this gap is being bridged. The growing World Wide Web is a case in point. It is widely embraced by people who associate themselves with intellectual and artistic culture. In 1997, the on-line magazine Mediamatic won the European Design Prize. Also, millions are now raving at types of music that deeply depend on computer skills, such as "Techno". These examples can be taken as hopeful signs that the gap is not entirely static. However, this art effect is not the only stimulus for more positive emotions towards information technology. Within information technology there is a development that makes it transcend the boundaries of utility and ‘nerdish’ play. This development is the growth of social capital in the world of bits and bytes, i.e. the Internet.
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