Social media is having an impact on our business lives. The immediacy of response is an expectation now a given. How do finance functions address this?
Tamara Littleton, founder and CEO of The Social Element outlines the importance of board engagement with social media, particularly in a crisis. Watch the video in a new window
The term ‘social media’ encompasses a range of tools that we are familiar with in our lives - from Facebook and Twitter to LinkedIn we may use all, or some of them, every day. Organisations are expected to have a social presence. Finance cannot ignore this as just an activity for marketing - as business leaders there is a responsibility to manage the risks.
Social media also has an internal aspect, how you foster collaboration and innovation amongst your teams, who might, or might not, be geographically diverse.
Why social media?
Why not social media? There is an expectation that, rightly or wrongly, everybody accesses social media. It enables us to share information on a ready basis, often in an instance. Sometimes too instantaneously for our liking. There is much to be gained for the finance function in embracing social media - if only as an additional channel to communicate to current and future stakeholders.
While we may think of social media as an external play, increasing collaboration and innovation within our organisation can often involve internal social tools. These tools can only prove successful, however, if there is a culture of openness and collaboration established around them.
Using tools to monitor social media gives you the ability to react to trends in reactions and conversations. Potentially being able to react to issues before they become crises.
The organisational strategy for social media is a board level issue, no longer one purely the domain of communications and marketing.
Implementing social media
Organisations need to define their social media strategies for both internal and external channels. It is no longer sufficient to leave this as an informal exercise. Reputations can be won or lost according to how you react. The time to react can be measured in minutes. Stories go viral.
Yet not having a presence diminishes reputation, be that as you as a member of the organisation and the role that you play, or of the organisation as a whole. However care needs to be taken to separate the personal opinion from the corporate channel.
Communications need to react to the unfortunate; be this a customer issue or a cyber attack. Strategies need to be developed, and tested, to manage these incidents. As with any mitigation plan, testing will expose weaknesses in process that are best identified before the crisis actually hits.
Impacts and issues
The following impacts and issues need to be considered:
- Ensure that you have a social media strategy that encompasses the management of your channels.
- Identify how crises are to managed including social media interactions; test plans and learn lessons.
- Use social media tools to improve your internal collaboration.
- Consider how to manage the impact of data privacy regulations on the use of personal social media accounts for external communications.
"To embrace social media and view it as a highly effective tool to reach your stakeholders directly, not to see it as a superfluous communications channel that potentially exposes you or your company to criticism. That's a mind-set issue. In practice, the positive aspects of social media far outweigh the negative ones."Jens Madrian, CFO / CCO Reactive Technologies
Key issues for the finance team
• Ensure that you have an organisation wide social media strategy.
• Ensure that the strategy is aligned to your corporate goals.
• Identity how you can best communicate with your stakeholders, both internal and external, using social media tools.
• Develop strategies to be able to respond to incidents effectively. Test these plans.