20A - Growing Your Social Capital

Assignment 20A – Growing Your Social Capital

Social capital, as we all know, is the economic/productive potential of strong, trusting, cooperative relationships. It is crucial that entrepreneurs never undermine the importance of building social capital. Who you know can often be just as important as and sometimes even more important than what you know.

Part 1

1) I confronted a barber in the local mall’s barber shop. I did not record his name, which is something that I probably should have taken better note of to help establish social capital with him. I figured that this barber would be the perfect domain expert since he has been cutting hair for almost eight years now, as I found out when I inquired as to how much experience he has. He is able to give just about any haircut that a male client may request.

2) This barber is a domain expert in my industry. He has much experience and as a technical expert when it comes to cutting hair, this barber is the perfect fit to be my domain expert.

3) I made a trip to the mall with three of my friends. When we got there, we all had to get haircuts. I was the first of my friends to be served, and I attempted to establish social capital with this man while he was cutting my hair.

4) I explained to the barber my situation. He seemed somewhat pessimistic that my idea was a good business idea; however, I am not discouraged by his appearing to feel that way. I asked him what goes into cutting hair that I may not be aware of or think about. He stated that for him, it is important to have the environment around his barber chair neat so that his clients recognize his professionalism. He also pointed out that it is crucial to clean and oil the clippers after cutting the hair of each client. He uses a spray that both sanitizes and lubricates his clippers. Until he pointed this out, I had not thought of this important aspect of cutting hair.

The favor that he did for me was simply providing technical advice for cutting hair. He explained some of things involved in the process that I had not thought about. The only return expectation that he had for me was that I paid him for the haircut. Tipping is not customary here in Australia, so he did not even have the expectation that I would provide him with a tip as a token of appreciation for his expert advice.

5) Although I may not have successfully included this man into my social network, I still learned from the experience. What I learned will help me to exploit the opportunity that I have identified. I did not get his name or contact information, but I could go back to the barbershop if necessary and I do believe that he would remember me. I learned the importance of remembering a person’s name and getting their contact information. Doing those two things is an important part of successfully establishing social capital through networking.

Part 2

1) The second person that I interviewed was the receptionist at the barber shop. Rebecca’s responsibilities at the barber shop include greeting customers, maintaining the wait list, cleaning up around the shop, receiving payment for haircuts, and selling hair products. Although she may not seem like a super skilled expert on the barbering market, I believe that she is to an extent.

2) Rebecca is my market expert. She oversees the selling of hair products such as shampoos, conditions, and gels within this market. Rebecca is an expert in the sense that she recommends the best hair products for her clients on a personal level. She knows which products are best for which kinds of hair and which products are best for clients based off how they style their hair. She also pointed out to me that the barber shop charges more for haircuts on the weekends. This is largely due to that the shop pays its employees more on the weekends than weekdays.

3) I contacted Rebecca and established social capital with her as I was paying for my haircut. She was a friendly girl and happy to answer all of my questions.

4) Rebecca expanded my knowledge on other aspects of the hair market that I know little about. These aspects primarily have to do with hair products. Although she did do me a favor by providing me with this information, she was also just doing her job as the shop receptionist. She expects nothing in return.

5) Including Rebecca in my network enhanced my ability to exploit the opportunity I have identified by increasing my knowledge as to other aspects of the hair market. I asked her if she would be able to provide me with discounts if I were to buy multiple hair products; however, she said no. I was hoping that I could also exploit my social capital with her by getting discounts on hair products and reselling them to my clients.

Part 3

1) The third person that I spoke with was a gentleman named Marcus. Marcus works at Big W, a discount store here in Australia. He’s been working at Big W for about six months now and doesn’t know where he sees himself 20 years from now (a question that I asked him).

2) Due to having limited transportation here in Australia, I was not able to go to a store that specializes in distributing products in my market. Big W sells hair clippers and various hair products. As a Big W sales representative, Marcus is essentially a supplier to my industry.

3) After spending about five minutes looking at hair products, Marcus approached me and asked if there was anything he could help me with.

4) I proceeded to experiment with how I might be able to establish social capital with Marcus and whether he would even be a good person to add to my network. Our exchange was rather informal. I determined that Marcus wasn’t very knowledgeable regarding the hair products and clippers that he is supposed to promote and help Big W sell.

5) Unfortunately, including Marcus in my network will not help me to exploit the opportunity that I have identified.

Reflection

This assignment did indeed require me to do a little bit of targeted networking. I learned that establishing social capital in certain markets is more difficult than establishing social capital in other markets. With my past entrepreneurial ventures, I have found it rather easy to network and establish social capital. In this assignment, I did not do a very good job of establishing social capital; however, I did still receive some beneficial feedback and information through this networking.

In the future, I will consider the importance of social networking in a market that I desire to exploit. If social networking is important in a market but it is very difficult to establish social capital in that respective market, the market may not be as easy to exploit as it appears.