Social Capital Mentor

The statistics are grim. According the the Department of Labor, the month of January alone saw the unemployment rate rise from 7.2% to 7.6%. In terms of lives, that’s around 598,000 directly affected. It’s anybody’s guess how many are indirectly victimized by the recession. Over the last 12 months, the number of unemployed people has increased by 4.1 million, bringing the overall number to 11.6 million. In the same amount of time, the unemployment rate has jumped a staggering 2.7 percentage points.

It’s unlikely that this trend will change for the better any time soon. Layoffs are coming in every major industry outside of maybe Health. In places like San Francisco, where many of the small businesses cater to an affluent clientele with a disposable income, the “trickle-down” effect of these current job losses have yet to fully materialize. The fact is many more people will be unemployed in the not-too-distant future.

The question for you is How can you maximize your chances of keeping your job?

You have to do your job (of course)

Obviously, let’s assume you’re qualified and you can actually do your job. If you’re not and you slid into your current position through chance and good fortune AND are unqualified to hold it, you’re unlikely to keep it. The upside of an economic downturn is that is filters out the hacks. Also, now may not be the best time to flout your “individualism.” It’s certainly the wrong time to be difficult for its own sake. But let’s assume you are qualified to do your job and have no major personality disorders. That should be enough, right?

No. Definitely not.

Set yourself apart

Think of it this way. Top-tier universities like Harvard and Yale often have more qualified candidates than they have space for. What do you do when you’re looking at thousands of 4.0 students and only a few hundred available slots? You go to “extra-curricular” activities. High School students who are serious about attending these types of schools will fill their non-school time with all manner of activities they believe will set them apart from their competition. They know that when everybody has a 4.0, GPA is mostly meaningless.

It’s not all that different when it comes to keeping your job. Common wisdom says it has to do with raw ability — that the best man (or woman) gets the job — but that’s simply not the case. All you need to do a job is achieve its minimum level of competency. After that, your soft skills become more important. For example, if a job requires the strength to do 20 pushups, does it make much of a difference if you can do 25 or 200? After you achieve the minimum level of competency, others factors come into play.

These “other factors” are difficult to talk about because they cannot be easily measured. You know that someone may have better personal skills than someone else but how do you place a metric on that? You really can’t. Because of this, many management systems choose to downplay these important factors, which shows a complete lack of understanding of how people make decisions - especially decisions about other people.

People make decisions based on how they feel

The truth is the vast majority of people make decisions based on how they feel, not what they think. For the most part, thinking (even good thinking) often only serves to bolster their overall impression, which is based on feelings. If the person who rates your performance thinks positively of you, believes you to be a team player and a hard worker, he will view your work product accordingly. If he sees you as a malcontent and a malingerer, your review will suffer as a result.

This dynamic plays out everywhere and at every level. Look at President Obama. He’s nominated 4 tax cheats to senior staff positions. He’s given waivers to lobbyists whom he said will have no part of his administration. He has shown his inexperience at almost every turn. Yet, his positive poll numbers are surprisingly positive - as high as 67%. His generally “likeablity” quotient is so high that his unavoidable missteps are easily forgiven or overlooked.

Contrast him with the former President. President Bush did more for the continent of Africa than any man in the history of the world. Even his enemies have conceded this point. He’s far more popular there than he is in his own country. Yet, you barely hear about this in any of our media and many people, when confronted with this fact, simply refuse to believe it. His “likeability” quotient is low so can can do no right, even when changing the lives of millions of the world’s most unfortunate peoples.

And it isn’t that different in our own lives. Think about it. When you’re in love with someone, they can do no wrong. It doesn’t matter how they behave. You’ll overlook or forgive almost anything. Yet, fall out of love and that very same person can’t get a break no matter what. I call this the “beer enjoyment meter.” The amount of pleasure I derive from a beer is directly proportional to how positively I feel about the person bringing it to me.

Layoff decisions are made the same way

Some people like to blame chance for who gets the axe, because it frees them of any culpability, but the same decision-making principles apply when considering whom to lay off. How else do you think this happens? It’s certainly not a computer spitting out names randomly, and it’s based less on objective hard skills than you might think. Generally speaking, it goes something like this.

Scenario: Costs must be reduced and some people must go

A senior accountant will approach the senior management team with the bad news. Financial realities mean layoffs. Costs must be reduced by a certain amount and they must decide whom and how many must go.

Simple Reality #1:
It won’t be senior management

The Senior Management Team will NEVER turn on one of their own even though one of their salaries may equal the combined salaries of 100 of their juniors. It is always easier to let go someone you don’t know than someone you socialize with.

So these Senior managers sit in a conference room deciding the fate of their subordinates. In this room, power and influence are the only things that matter and generally speaking, no one will easily give up any of their own departments because a loss in people is a loss in power (in times like this, it pays to report to a strong manager because he can protect you).

Eventually, the most senior man in the room will decide how many must go and from which departments. From there, the department heads make further decisions. How far this process goes down depends on the size of your organization. The senior manager tells his direct reports (middle managers), “You each need to let 1000 people go.” Each one of these mangers goes to his direct reports (junior managers) and tells them that they each need to release 100 people. And so on until someone ends up with a pink slip. Of course, the exact details of this process depend on your organization and situation but in almost every case, it goes more or less like this.

At some point, the buck will stop with your direct manager who may have to decide exactly whom to let go. If he’s lucky, it’s just one person, though these days, he’s very rarely that lucky.

Let’s look at his decision-making process (for our purposes, we’re going to assume that he’s an ethical and competent manager). First, he’ll look for anybody who’s underperforming. If you don’t get your job done, consistently show up late, fail to meet regulations, you’re likely to be among the first cut. Second, he’ll start looking at trouble makers - people who don’t work well with others. These people generally think they’re safe because they “do their jobs” but that’s assuming too much in these difficult times. If you met all your job requirements but refused to get along with your coworkers, you’re going to be next on the block. Those two lists are easy for the manager to come up with, relatively speaking.

The hard part comes next, when the manager is left with a group of competent people whom all work well with each other. What does he do then?

Simple Reality #2:
Doing what’s required of your job is not enough to keep it

Good and deserving people will lose their jobs. There’s very little we can do about that at this point. The only real question that remains is how to be among the people that get to keep their job.

The answer is Social Capital

I’m not trying to be trite with that statement. This current recession means less financial capital. Also, you aren’t likely to get any more intellectual capital in the short term - not in time to meet the decision-making loop of layoffs anyway. The only type of capital that is left is Social Capital. Unfortunately, like most other types of capital, it is best developed when you don’t need it, but we can’t complain about that now. Also like other types of capital, the more you have, the more you can do with it, so it pays to start stockpiling it as soon as you can (Craig blogged about this recently here and Guy Kawasaki’s post a couple weeks ago reminds you to build your network before you need it, but I digress).

Social Capital is a complex topic which I will expound on more fully in later articles but for now, you must understand that it is actually capital. If used properly, it can take the place of financial capital you may not have. But Social Capital can do things that financial capital cannot. It has the ability to get things going and even to close deals in lieu of actual money. In our example above, it can tip the scales in your favor when a manager must decide whom to lay off.

Stay tuned

It’s a tough time for everyone right now, but we’re going to pull out of it. Send me your questions; your concerns. Keep coming back and I’ll help you develop Social Capital and use it effectively to your advantage. Social Capital can help you keep your job. In fact, it very often is the only thing that can.

Subscribe to Social Capital Mentor by Email