Business leaders can benefit from understanding the relationship between these different—but related—concepts.
In the past month, who hasn’t heard someone tell them to practice “social distancing?” The phrase, which is so common recently, was nearly unused in daily conversation until March of 2020. However, experimental economists have been exploring the concept of “social distance” for decades in their attempt to understand what leads to decisions to invest, cooperate, reciprocate, and trade with others, in addition to other economic behaviors. Interestingly, the two concepts, while so similar sounding and intuitively connected, are incredibly different in action and practice and potentially are at odds with one another.
“Social distancing,” in common parlance, is the practice of individuals staying away from one another during global disease pandemics. Implicitly “social distancing” is intended to reduce physical proximity between individuals. The idea is that if people avoid contact with others, then those that are sick cannot infect others as rapidly. Therefore, even if the total number of people infected is the same, the slower pace of disease progression will be more manageable by constrained healthcare services. People are prodded both top-down (through forceful channels) by governments, schools, and businesses as well as bottom-up (through voluntary channels) by family, friends, and social networks to avoid close contact with other people. The benefits of social distancing are obvious, but the costs of social distancing are rarely discussed.
“Social distance,” on the other hand is typically measured by economists as the degree of connection between individuals in an environment. Anonymous strangers would typically be thought to have a large degree of social distance, while friends would have lower social distance, and spouses even less social distance. Laboratory studies across many countries consistently show that decreasing social distance is economically beneficial, typically related to increased rates of factors like cooperation, trust, and charitable giving. Decreasing social distance between people, even anonymous strangers, can lead to improved cooperative outcomes, and can potentially be done by things such as information transmission, communication, and visual or physical proximity. A large cost of recent “social distancing” can be thought of as being the losses of the benefits of the low “social distance.” Hoarding behavior, shortness, vindictiveness, non-cooperativeness, and social shaming may all be signs of general increases in social distance.
Businesses have long adopted processes, policies, and procedures that may work to decrease social distance within their organization and help them capture the associated economic gains. Team building, employee ownership, and “family” type language within the companies may have been an effective way to decrease social distance between those in management and the workforce, which may help increase efficiency and worker cohesion and also reduce costs. Likewise, businesses have adopted similar policies that may reduce the social distance between the business and consumers, for instance framing the producer/consumer relationship as a family relationship.
A potential downside of COVID-19 social distancing efforts, should they prove effective, is that they may have lasting unintended consequences of increased social distance even after social distancing regulations and policies have ceased. People may be more apprehensive of interacting with strangers and people who don’t fit into their normal circle of friends and associates (what researchers often refer to as “out-groups”). While “family” language may have gradually helped knit together a workforce and created relationships between companies and clients, reducing social distance, social distancing practices will be a tangible reminder of who is and who is not family. Businesses should be prepared for the potential undoing of those and other policies that were previously instituted that reduced social distance, and that the removal of forced social distancing is unlikely to immediately renew the former close social distance that existed previously. Reminders, particularly to regular customers of the past, of the ongoing relationship may be helpful.
Businesses may also want to be cautious when considering how to use telecommuting during the COVID-19 crisis and whether to continue to use telecommuting when crises subsides. While there are many gains from telecommuting, care should be taken to ensure that those workers telecommuting remain close, in the social distance sense, to other workers and management. Frequent communication, visual if possible, through web cameras and meetings, may help maintain close social distance even when physical proximity is great. Social distance need not be social isolation.
A final hope is that shared experiences have been experimentally shown to potentially reduce social distance and/or increase a feeling of “connectedness” between individuals. The health need for social distancing affects everyone, not just one group of society. Both CEOs and workers, rich and poor, liberal and conservative, in-group and out-group, family and stranger are sharing the experience of social distancing. The COVID-19 crisis, unlike a natural disaster, war, or even structural financial crises is general and international. This shared experience and the shared unpleasantness and unnaturalness of social distancing could potentially be a force to reduce social distance in the long run, as we have now seen that we are all in the same boat. CEOs, managers, and businesses in general may recapture their former close relationships most easily through highlighting the similarities of their shared experiences.