THE CHALLENGES AND OPPORTUNITIES OF SOCIAL MEDIA
In A World Gone Social, social media entrepreneurs Ted Coiné and Mark Babbitt lay out the growing impact of social media on our lives and our businesses.
They begin by exploring how social media has shifted the power away from corporations and into the hands of their customers and their frontline employees. The power that social media has given customers is fast becoming legendary, as stories spread of how one unhappy customer is able to bring a corporation to its knees — well, at least send it scurrying for cover — by creating a maelstrom of discontent and bad publicity.
For example, the ill-advised Bank of America fees for services typically offered for free — such as having a debit card — created a social media-based firestorm of protest from customers, causing the financial services giant to reverse its position. The authors note that BoA’s initial reluctance to respond made the situation much worse than it had to be. The authors describe, in contrast, the response of Verizon, which made a similar ill-advised decision to put in a small fee on a traditionally free service. Unlike BoA, however, Verizon retreated as soon as resistance began to build.
Social media has also empowered employees. The authors tell the story of a minimum-wage Target worker who resisted a call to work on Thanksgiving and Black Friday. Her respectful open letter on social media to Target’s CEO went viral, and Target was put on the defensive. The retail giant crafted a careful response, noting that rather than resistance to the holiday work, there were more volunteers than shifts open for those who wanted to work on Thanksgiving. However, the response also stated that there was no corporate mandate to work on Thanksgiving, which clearly left open the opportunity for local Target managers to make Thanksgiving mandatory.
Another damaging threat comes from insulting or insensitive comments on social media from high-ranking employees, leading to what the authors call a “virtual lynch mob.” In one case described by the authors, one manager tweeted, “Going to Africa. Hope I don’t get Aids. Just kidding. I’m white!” before boarding a plane to Africa. When the manager got off the plane, she learned that she had been fired — and that her dismissal had been publicly announced.
The transparency of social media puts the spotlight on corporations in ways that had never been possible, and corporations must respond accordingly, the authors write. For example, employee engagement is more vital than ever. An unhappy workforce has myriad options for venting their disapproval. (In one example, employees described in bloody detail — through the company’s own communications channel — the massive layoffs sweeping through the company and the impact on those who were being laid off. The marketing director finally became aware of the posts and eliminated them from the platforms, but the damage had been done.)
Social media presents challenges for corporations, but it also presents new opportunities, the authors write — although perhaps not necessarily or exclusively for corporations. In fact, one of the first rules of the social media age, according to the authors, is “the death of large.” Large, rigid corporations don’t have the agility to compete in today’s dynamic marketplaces.
Companies must go flat, the authors write. It’s time to lose the layers of middle managers. Communication must be direct, open and easy — which means it’s time to lose the old useless meetings that, according to the authors, “serve only the grandstanders and bureaucrats.” Going flat also means greater accountability from everyone. A case study of America’s largest tomato processing company shows that going flat is possible in even the most traditional industries far removed from the “knowledge” economy.
The effectiveness of crowdsourcing for solutions, the top priority that must be given to the customer experience and the requirement for leaders to be “social” — to know how to be a true and engaging presence on social media (tweets “from” the CEO actually created by PR employees don’t count) — are some of the other topics covered in this wake-up call to companies and leaders who are slow to embrace social.