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The Value of Schmoozing on Social Media

Wharton professor Lynn Wu notes that although the adoption of social media in the workplace can improve a firm’s bottom line, it also has a surprising effect: The more individuals use “social” terms — such as “coffee,” “lunch” or “baseball” — while engaging with colleagues on social networks, the less likely they are to be laid off.

Wu told Knowledge@Wharton that the finding is surprising “because I deliberately chose to look at an industry (consulting) where you can measure an employee’s value to the firm very clearly. In the end, how much money you bring into the firm should be the ultimate value…. But in fact, what I found is that social communication has bigger power than objective performance [measures] in predicting whether individuals were laid off during the recession.”

She added: “I’m not saying that people should necessarily just stop working and use social media all the time. But perhaps there’s a value that social communication can provide that we don’t see. Perhaps this person is a really good team player, and people really enjoy working with this person. Maybe he did not bill directly, but he enabled his co-workers or his colleagues to do a better job. Perhaps that’s one reason. Or you can think of the traditional old boys’ club where people who tend to schmooze a lot get ahead.”

Wu’s research also sheds light on the recent decisions by some companies to restrict or limit the ability of employees to work from home.

Said Wu: “If social communication is an important predictor in your career outcomes or career trajectories, perhaps it pays to show up and to enhance those social connections around you and to understand your colleagues who know what’s going on — because a lot of information, especially intangible information, is passed through water cooler conversations. If you’re working at home all the time without having that access, perhaps you’re actually worse off as a result.”

You can read more about Wu’s findings in a paper titled, “Social Network Effects on Productivity and Job Security: Evidence from the Adoption of a Social Networking Tool.”