Over the past five years, use of social media has seen tremendous growth; not just in usage by the average consumer, but also by businesses that are chasing these consumers.
In order to take advantage of the potential benefits, businesses must first understand the history of social networking, who the users are (through statistical analysis and business intelligence), the marketing and information management of this platform including CRM (customer relationship management), what potential legal and ethical issues might arise (and how to manage them), where social networking is heading in the future, and finally; whether it is an appropriate fit from a business perspective to invest time and money into social networking.
The term “social media” is used to describe the websites and applications used for social networking (Oxford, n. d. ). Thus, the terms “social media” and “social networking” are not identical, but they share sufficient similarities to be used interchangeably throughout the following paragraphs. Social networking is a web-based service that allows individuals to contract a public or semi-public profile within a bounded system, articulate a list of other users with whom they share a connection, and view and traverse their list of connections within the system (Boyd & Ellison, 2007).
Fifteen years ago social networking did not even exist. The first social networking site, SixDegrees. com, launched in 1997 and was the first to combine the buddy lists that AIM and ICQ featured with the ability to create profiles (that major dating sites used). By the year 2000, SixDegrees was out of business as early adopters found there was not much that could be done once friend requests were accepted. Between 1997 and 2001, a number of community tools experimented with various combinations of profiles and public friend lists including AsianAvenue, LiveJournal and LunarStorm (2007).
The next wave of social networking came in the early to mid 2000’s with the introduction of LinkedIn, Myspace, Twitter, YouTube, and the most well known of today’s sites, Facebook, in 2005 (see “Appendix A” for timeline). LinkedIn has always been a business focused site, allowing potential employees and employers to connect. Other social media sites were initially intended for personal use; however, this is rapidly changing.
Social networking has continued to grow exponentially since 2005 (with Facebook leading the way) and is now a mainstream web-based activity. Taking into consideration the four most popular social media sites currently being used for both personal and business purposes, the statistics are staggering. Facebook has 750 million active users; Twitter has 200 million users, YouTube 490 million and LinkedIn 100 million. Social networks and blogs are now the fourth-most popular online activity (ahead of personal email).
Over the past two years, use of social networking has grown to 24% of the time spent at work (Trend Micro 2010); therefore, how we choose to connect at home needs to be reflected in our work environments (Nielsen Online, 2010). Social Networking in the workplace has proven to have a positive effect on communication, recruiting and retention, marketing and business collaboration; with firms boasting elevated levels of productivity and profits due to high employee engagement and satisfaction.
Social media is changing the game for how we engage. Social networking sites can keep professionals and business people current on events, trends and opportunities in ways traditional communication cannot, and today’s organizations and business leaders are being asked to do more and communicate more than ever before. In fact, 79% of the largest Fortune 500 firms use Twitter, Facebook, YouTube, or corporate blogs to communicate with customers and other stakeholders (Burson-Marsteller, 2009).
Firms that communicate effectively are four times more likely than their peers to report high levels of employee engagement and 20% more likely to report lower turnover rates (Ray, 2009). They also enjoy higher market value and better shareholder returns (Watson Wyatt, 2010). Taking into account that companies have one of the most powerful employee engagement tools at their disposal, and given the strong correlation between communications and business performance, it stands to reason that more than just Fortune 500 firms should be leveraging social media to their advantage.
Employers are increasingly using social media as a low cost recruiting tool; social networking sites such as LinkedIn can help you get a job, change from the one you are in, or establish yourself as an expert in your field. Statistical analysis reveals that while up to 75% of hiring managers use LinkedIn to research candidates (Jump Start Social Media, June 2009), a surprising 66% of companies have successfully hired a candidate identified or introduced through an online social network (Jobvite Study, 2009).
As mentioned previously, while LinkedIn is a social networking site intended for businesses, a personal profile on Facebook is not; however, this does not stop employers from checking employees or potential employees’ backgrounds on “personal” social networking sites (covered in more depth below under privacy and ethics). The workplace is continually undergoing change as it adapts to new technologies and advancements in global markets.
However, for the first time in decades, the workplace will undergo a huge demographic shift as baby boomers will become outnumbered in the workplace by millenials (those born between 1981 and 2000) in less than two years. Socially intelligent leaders will need to embrace new strategies that will connect with staff across the generation gap. Up to 41% of millenials say social media is important to them in the workplace and 39% would consider leaving if they were not allowed access to applications like Facebook and YouTube (The Social Workplace, 2011).
As reported above, the more engaged the workers, the higher the company profits; therefore, more employers should be turning to social media as a means of increasing employee satisfaction and retention, as the costs related to employee turnover can be quite high. Sabre is an example of a company that has attributed $500k in savings to their employee social networking tool. They report high levels of employee engagement, retention, and productivity and received an award in 2010 for driving process change with business (social) intelligence (Sabre, 2011).
Businesses are also recognizing the benefits of low cost marketing through social media. Social networking has a huge potential to be developed by almost any business management: business organizations can build their online community through engagement and interaction with the public and other businesses within the organization. Social networking strengthens a variety of both B2C (business to consumer) and B2B (business to business) activities in the areas of marketing, CRM (customer relationship management), and business collaboration.
A survey of marketers using social media revealed 84% of companies are utilizing Facebook for marketing purposes and 81% said it generates more exposure for their business (Social Media Marketing Industry Report, 2009). This has expanded well beyond Fortune 500 and 100 companies with 73% of small businesses saying social media is now a large part of their marketing activities and 82% claiming Facebook as the most effective (Constant Contact, 2010). Social networking for marketing purposes is known for its cost efficiency. In other words, greater benefits can be achieved relative to the investments ade. Social networking provides tremendous prospects for the B2C activities of an organization. Marketing functions, for example, can be greatly enhanced through the use of social networking and an increasing number of marketers have recognized social media as a powerful marketing tool. A study conducted by the Center for Media Research in 2009 predicted that social networks would become one of the most popular marketing strategies in 2010, second only to emails, and exceeding keyword search, radio and magazines (Porterfield, 2009).
In a study conducted by Stelzner regarding the benefits of social media, the majority of marketers claimed the abilities to “generate more exposure”, “improve traffic”, and “improve search engine rankings” as the biggest advantages of social media marketing. In addition, a plurality of marketers surveyed believes that utilizing social media marketing will reduce overall marketing expenses. This advantage is more pronounced for self-employed and small business owners with two or more employees.
Typically, small businesses and non-profit organizations are not as engaged with heavy promotional initiatives as larger businesses (such as international corporations) due to their limited human and financial resources. In such cases, social media allows these units to exceed their performance by offering free or low-cost marketing opportunities. Furthermore, social media is effective in reaching target customers through CRM applications such as Facebook’s API which tracks user’s communications and preferences (Taylor, 2008).
Facebook is reported as the most popular social networking site: half of Facebook’s 750 million users log on in any given day and spend over 700 billion minutes per month on the site, which equates to 900 million objects (including pages, interest groups, and events) that unwittingly stay connected to many of these users (Facebook, 2011). Also, when someone “likes” a brand’s Facebook page, purchase intent increases four times versus a regular Facebook ad, and there is a 24% increase in the number of users engaging with a Facebook ad campaign due to the social ads (Nielsen and Facebook, 2010).
These features along with numerous others such as shared functions (web links, status update, photo album and notes) provide the most powerful word-of-mouth marketing opportunities for marketers. Opinions posted by consumers online and recommendations by personal acquaintances are the most trusted forms of advertising globally (The Nielsen Company, 2009). Thus, social networking in conjunction with CRM is an extraordinary tool to communicate, engage, and solicit immediate feedback from the firm’s target customers and enable the business to conduct promotional marketing online at little to no cost.
Social networking can also be harnessed to enhance B2B activities; in particular, business collaborations. Social networking empowers companies through the provision of various information sharing capabilities and collaborative computing solutions. In this Information Age, easy access to customers and partners, as well as a smooth flow of essential information across the value chain, is invaluable to many organizations. Nowadays, with the emergence of many international companies that have remote operations and a high degree of outsourcing, work environments are more detached which presents challenges to management.
Popular social media platforms such Twitter, Facebook, YouTube and corporate blogs, allow significant communication and collaboration with stakeholders including suppliers, distributors, customers, and shareholders and are usually indispensable in many businesses. In an increasingly global yet disconnected economy, utilizing social networking allows these different stakeholders to sign up and be grouped; forming a structured platform that allows effective and efficient business communication and collaboration (Eisenhauer, 2010).
While social networking in the workplace has its advantages, as with any new platform, consideration must be given to privacy and ethics issues. Traditionally, the four walls of an office have predominantly enabled companies to manage the privacy of the information they keep. Social technologies now globally extend information and this moves companies well beyond the scope of conventional privacy protection approaches. Social networking and privacy in the workplace is a relatively new and multi-layered issue for companies to manage.
Businesses are struggling to keep abreast of privacy issues such as risk management and compliance including data leakage (in the use of confidential business information) and the protection of brand identity. The Privacy Commissioner of Canada makes available a fact sheet that provides guidance for companies; however, just as technologies change so do the rules and regulations that oversee them. Therefore, companies are becoming increasingly aware of the need to balance protection and privacy while remaining open to change and embracing the benefits of new technological advancements.
Social networking has developed and grown exponentially in a way that no one could have anticipated. As a result, companies are attempting to manage and control the many layers of privacy concerns that are rapidly emerging with the use of social media in the workplace. Businesses need to have the ability to keep confidential business information private; only to be viewed by those for whom it is intended. At least 66% of large organizations surveyed said they were “concerned” or “very concerned” about maintaining compliance while enabling social sites.
Data leakage was more of an issue, with 82% of large organizations reporting that they are “very concerned” or “concerned” about data leakage as related to the social web (Forrester, 2010). While social networking has allowed information to pass quickly and easily to business associates which reduces costly and time consuming conferences and business trips; unfortunately, once information has been digitally sent onto the internet there is no guarantee that only the intended recipients will receive it.
Another privacy issue companies are trying to manage is maintaining brand identity in harassment free and non-defamatory company communications. Up to 74% of employed Americans believe it is easy to damage a brand’s reputation via sites such as Facebook, Twitter and YouTube (Allen, S. L. , 2009). Any benefits to companies by expanding public exposure into social networking sites must outweigh any potential detriments, such as opening the door for employees to harass, bully or make slanderous comments about their co-workers, managers or the company on the web.
Even if employees express personal opinions, these comments may be attributed to their employer, with potentially negative consequences for the company. Just as social networking sites are relatively new, so are the laws that have been enacted to give guidance for their usage. The Privacy Commissioner of Canada has created a fact sheet, Privacy and Social Networking in the Workplace, to protect both the company and the employee.
This fact sheet directs companies to develop policies on the appropriate use of social networking in the workplace: “The policy should establish best practices and outline expectations for acceptable use of SNS in the workplace, set out the consequences of misuse, and address any workplace privacy issues” (Office of the Privacy Commissioner of Canada, 2009). Our current legislation that protects personal information is the Personal Information Protection and Electronic Documents Act, or PIPEDA. This act outlines rules that companies must follow when collecting, using or disclosing personal information in the course of commercial activity.
A proposed amendment to PIPEDA is being considered to create a more secure online environment for both individuals and companies. The most significant change being proposed is to include a breach notification. This will make it mandatory for companies to report to the Privacy Commissioner any material breach of confidential information; a material breach is one which would pose a real risk of significant harm. If the Privacy Commissioner determines that the company’s breach of an individual’s information poses significant harm to the individual, he or she will be notified. A discussion of privacy is not complete without the mention of ethics.
Since ethics deals with what is morally and socially acceptable, it is of the utmost importance we discuss what is morally right when dealing with social media in the workplace. In the past, a person’s work environment could be clearly defined as a specific area in which business was conducted – be it an office in a building or a spot on a production floor. Today, the line between work and home is becoming blurred. From smart phones to VPN connections, workers are finding themselves conducting business in more and more places that were traditionally thought to be part of their “private” lives outside of work.
This causes much debate on where to draw the line on personal versus private realms. The more the line becomes blurred, the more socially “acceptable” it becomes for employers to have insight into what was once the “private” lives of employees. There is an ethical social responsibility when it comes to recruiting and marketing that must be adhered to, and companies should also be aware of the methods of information technology (IT) that can aid in the ethical use of information sharing.
As discussed, recruiters work diligently to find “the right person” for the job and behavioral interviewing techniques are topping the of interview styles. It only stands to reason, then, that viewing a person’s Facebook page might give a good indication of that person’s core values and aid in determining if that person is a good “fit” for the company: as many as 47% of employers use social networking sites to look at candidate profiles (Hensel, 2009). Is this ethical? Is it right to view someone’s personal thoughts, feelings, and actions, (as well as their friend’s actions) and potentially hold that gainst them? Information is only to be used for its “intended use”. Generally, Facebook accounts are not created for employers to learn more about us and decide if we are suitable candidates for their company. Furthermore, it would be difficult to ascertain and prove if we are being judged on discriminatory criteria such as sexual preference, marital status or religious and political beliefs. Another aspect of ethics in social media is the sheer monetary value of its use in generating business.
According to CMA Magazine, “Syncapse, a Toronto-based firm specializing in online content management, has come up with the figure of US$136. 38 as a proxy for the average value of a Facebook fan” (Morris, 2009). This definitely shows the benefit a firm can receive from the use of social media such as Facebook to generate business; 54% percent of companies now have at least one Facebook Fan page (Burson-Marsteller, 2009). The question becomes: is it an invasion of privacy for a company to reach out to your personal contacts in an effort to generate business either with or without your knowledge?
For example, if you made a supposedly “confidential” purchase of a sensitive nature only to find out within hours or days that your personal friends or even business contacts had been solicited by this company and your name had been mentioned. As technology is changing at an exponential rate, so is hacking. This creates a tremendous burden on any company to find better ways of protecting itself, its employees, and its customers from unwanted and unlawful use of information.
Fortunately, there are newer and better solutions being created in the IT world every day, such as better antivirus programs, antispyware, and firewalls. Some businesses have discovered how to turn the media itself into a defense: the dissemination of information through media in the workplace. Instead of a few IT staff working diligently to protect everyone in the company, every employee is empowered with the knowledge to join the fight in defending themselves and their company.
Whatever the method, it is important that a company develop a strategy and a policy that incorporates social media along with the appropriate guidelines for usage. It is interesting to note that only 1 in 7 companies has a formal process associated with adopting consumer-based social networking tools for business purposes and only 1 in 5 actually has a policy (Cisco, 2010). There are at least three ways to manage social networking at work. One is a complete ban. In these times of decreased motivation and people staying in jobs because they are too fearful to move, a heavy handed approach is not likely to work.
A second approach would be to accept that it happens and manage it. For example, have a policy that allows a restricted amount of time for social networking (30 minutes during lunch or outside of hours). A third option is to have an Enforceable Social Networking Policy. An all-inclusive policy will best prevent abuse of the system and as part of the induction process; details of the policy (and consequences for not adhering to the policy) must be laid out clearly and comprehensively.
Handing an employee a policy handbook containing an electronic communications and business conduct policy is not going to stop people from social networking at work (Wilson, 2010) (see “Appendix B” for a brief social networking policy example). Employers can no longer ignore social networking, but rather ensure that it is a benefit and not a drain on their resources. Therefore, the best approach is to accept it and manage it either by allocating internal resources or by outsourcing to companies that specialize in social networking at the workplace.
There are a couple of local start-up companies such as Radian6 and Sociallogical that recognized the future of social networking as becoming a mainstream function of business. If a company considers outsourcing social media functions, to a company like Radian6, services start at $600. 00 per month (social media marketing is being outsourced more than ever (eConsultancy State of Search Marketing Report for 2011). Radian6 has built a business that capitalizes on this growing phenomenon by specializing in all areas of social networking for business.
They have developed a social media monitoring platform that measures the effectiveness of social media; this platform will help any business manage and implement best practices according to individual needs and goals regarding social networking. Radian6 also provides its customers with a web-based dashboard to view relevant conversations about their brand. This visibility makes it easy to analyze the information and gear it towards customizing programs for various businesses. Radian6 gives you a complete platform to listen, measure and engage with your customers across the entire social web (Radian6 Website, 2011).
Sociallogical is a new Saint John based company that helps businesses plan and develop social strategies, products or services with social media in mind, or gather data through business intelligence (termed social intelligence). By first developing a strategy and timeline, a company is in a better position to determine the type of customer engagement and social networking that best allows them to take advantage of their target audience. Also, by becoming “social” online, businesses can take advantage of the unprecedented amount of data available through advanced analytics and social media monitoring.
Sociallogical holds social media and business seminars that explain how their company can help with the aforementioned strategies and also educate businesses on how to use social media to their advantage. Sociallogical is a new, visionary consulting company that educates social-media-inclined business owners on strategic online connectivity tools and practices for their customers, prospects and employees based on our deep understanding of how web-based relationship building can generate effective ROI for any organization (Sociallogical website, 2011).
Over the next decade, organizational functions such as human resources, marketing, and business communications will continue to evolve as they become more affected by the development of highly visible customer driven strategies, resulting from the integration of social networking into business operations. There will be more open sourced tools within Twitter and Facebook in the near future and companies will be able to customize applications and pages within many social networking platforms.
This in turn, will give them more control over their target audience and the information they are giving the customer. As well, technological advances of RFID tags and facial recognition features integrated into applications will increase employer involvement. Google+ is the newest entrant into social networking. Currently in a limited beta trial right now, they are expected to surpass Facebook (who has banned their ads) in features such as advanced grouping of contacts, sharing capabilities, easier upload of photos, and video chat.
From a business perspective, involvement in social networking is no longer an option but essential. Firms that embraced social media grew, on average, 18% over the last 12 months, compared to unengaged companies which saw, on average, a 6% decline (Altimeter/Wetpaint, 2009). Therefore, a complete ban of social media can be detrimental to employee engagement satisfaction, and company profits; while a substantial 69% report having gained measurable business benefits, such as a low-cost method of recruitment, more effective marketing, a better value chain hrough an enhanced business communication and collaboration process, more innovative products and services, better access to knowledge, lower costs of doing business, and higher revenues (McKinsey Global Survey, 2009) (Security for Business Innovation Council, 2009). Companies are urged to invest time and money in implementing a social networking strategy and policy that takes into consideration their privacy and ethical concerns. Finding the right fit can be achieved through the use of “social intelligence” that permits functions of social networking in the workplace whereby benefits are recognized by both management and employees.
Appendix A: Appendix B: Example Social Media Policy: (a brief version) Personal Use of Company Electronic Communication Systems: ‘The Company’ would prefer employees not to use the company electronic communication systems for personal use. However, limited personal use will be permitted provided that it is in compliance with the following; Outside of core business hours Appropriate Not potentially offensive Not derogatory Not defamatory Not of a bullying or harassment nature Does not contain the company name or make any reference to any company employees by name Does not discuss confidential company business The Company’ reserves the right, at any time, to access, audit, read, delete, retain, review all electronic communications, sent, received, stored, accessed or transferred on the company system. This includes monitoring information pertaining to Internet usage. Violations and Consequences: Violations of this policy may be grounds for disciplinary action up to and including termination of employment, or immediate revocation of any or all electronic communications access and user privileges. In addition, certain violations could result in civil or criminal liabilities for the Company and/or the user.
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