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Social networking and technologies are rapidly permeating many aspects of business. As a result, the age of “social management” for corporations is upon us. A perfect storm enabled by wireless devices and the evolution of internet-based software is driving today’s social networking explosion. As a communication device and community enabler, social networking is here to stay. These tools have already validated their power in unpredictable and empowering ways. Governments have witnessed this first-hand. This power brings both risk and opportunity to corporations and their boards. Social media technology greatly accelerates the speed at which information moves and amplifies the real or perceived impact of an event. These tools can also provide your company with remarkable power that extends from reaching your customers differently to changing your business model.
The reach of social networking technology in the corporate context can be surprising for many directors, and already includes uses in:
- Workforce collaboration and communication
- Customer management and service
- Recruiting
- Corporate social responsibility
- R&D, innovation and creating competitive advantage
- Marketing and advertising
- Supply chain management and reengineering
- Brand management and investor relations
- Revenue growth, market expansion and sales effectiveness
- Process reengineering
The tools and techniques of social networking available from Facebook, Salesforce. com and others have already embedded themselves throughout your corporation— in many instances, directly by your employees. This is frequently happening outside of any policy or procedure and without your management teams being aware of it. Boards need to understand the immediate risks of social networking. Management needs to openly embrace and advance the opportunities that social networking presents, as this technology can be a potential game-changer.
Social technology is here to stay and its use will only expand in ways yet to be determined. Social management will change the status quo in your organizations in profound and unpredictable ways. It has already transformed governments— just think what it can do for, or to, your company.
Assessing Risk and Opportunity
Boards can ask these questions to assess the risks and opportunities social networking presents to their companies:
- In what capacity are we currently leveraging social networking—both internally and externally?
- Do we have a formal strategy and policies and procedures in place for our social networking approach?
- How are we educating and training our company workforce on the risks of social technology and company policies?
- How can we use social technology as an opportunity to build networks, engage consumers in discussion and learn about public sentiment with respect to our brand or products?
- How are we addressing the inherent risks, such as negative brand image, data loss, distribution of malware/viruses and decreased productivity?
- Does our social strategy address ownership issues around intellectual property?
- How does our organization work across functions to address customer information protection and potential data loss from social technology?
- Where is the data collected from social media stored? Can it result in privacy/ security risks or breaches?
- How well are we prepared to deal with the potential ethical ramifications of social networking mistakes/misfires?
- Have we performed a business impact assessment to identify the corporate uses of social media and their impact on security and privacy?
- Have we implemented people, processes and technology solutions that ensure content and information protection at the data level and provide access control for sensitive data and intellectual property?
- Do we have internal policies with a level of control that delivers effective protection without negating the benefits of social networking?
- Do we have a clear incident response process to monitor for and respond to negative publicity through social media channels?
Bob Zukis is a partner at PwC.