The combination of microeconomics and strategy was groundbreaking at the time. A generation of company leaders are steeped in it. They can recite Porter chapter and verse, and often use buzzwords in their relaying of company goals, achievements and challenges.
Porter’s five forces are still the bedrock of competitive analysis. However, since the dawn of social networks, interacting with the five forces is changing rapidly. Businesses that don’t interact correctly risk becoming dinosaurs.
Initially, the two forces I would concentrate on are Supplier Power, Customer Power, and Substitutes. That’s the easiest place to use social networking tools to make a difference.
Even though ubiquitous social networks are now de rigueur. They are still brand new on the scene. There is a lot of bull to them, but utilized in the right way, they have the power to help CEO’s create greater shareholder value for their company. What piqued my interest was this article on how SuperValue ($SVU) is utilizing Yammer to create a corporate culture for a merged company.
Supervalu, which owns brands such as Albertson’s in the U.S. Northwest and Shaw’s in New England, was created through a series of acquisitions, so the company was looking for a way to foster better communication and a sense of shared culture.
My first thought was how do companies that use Yammer avoid groupthink? Since it’s impossible to remain anonymous, how does someone dissent from the corporate party line? If a company uses Yammer, it’s critical that the company monitors the dialogue so that communication is open and free. They could unknowingly be squelching good ideas from their employees.
Once the step is made to go from standard email to a more structured social network, the company should also make the choice to institute a more entrepreneurial culture within its four walls. Managed correctly, an entrepreneurial culture should be better for the company. For example, managers might want to create a smaller, more localized social network using Kik Messenger. Social networks handled incorrectly could turn a company into a monolith. Monoliths can be strong, but they topple.
But internal communication is only one aspect of using social media to advantage your company. There are so many other ways to use it.
Of course, there is Facebook. Every company has one but few use them to their advantage. It’s more like a checklist item for a lot of companies rather than a real tool. Facebook becomes the constantly evolving public face of your company. Companies should update their Facebook site daily, and not just with company only news. Try and be creative. Put stories up that compliment what you are doing. Create contests. Creatively ask for customer feedback and input. Engage and interact. The more you do that, the more you build credibility for when trouble hits.
Twitter is another outlet. CEO’s should tweet. Tweeting becomes another facet to your personality, and puts a personality on the company. Tweet stories that you find interesting. Tweet interesting things about your company. Congratulate an employee publicly on Twitter. But most of all, you might want to start tweeting earnings calls, and financial information. Twitter is the quickest way to disseminate it.
That’s a double edged sword. Because when bad stories hit the company, Twitter will spread that too. If you aren’t engaged in Twitter, you are fighting bad news with one hand tied behind your back. Engaging bad stories head on utilizing Twitter will help transparency come to the situation and help you mould the spin in the media. Not using it risks a vacuum, and your competitors will certainly fill it up with the news they want people to know about. Running the risk of letting competitors control the conversation about your business is a bad idea.
Facebook and Twitter are cool, but I think Pinterest may be just as powerful. It has been said a “picture tells a thousand words.”. You can illustrate your companies personality and culture better with well chosen photos posted to Pinterest. They don’t all have to be about your company. Suppose your company has a goal of providing transparency. Maybe you create a Pinterest board titled, “Transparency”, then post photos of transparent things. Single celled amoebas to professional photographs. Doesn’t matter. Drive home the theme. Eventually, crowd source it with your engaged user base. Done well, they will get repinned all over the place spreading your brand.
We are just in the early stages of understanding how these tools can be used. No one, and I mean no one, is an expert. There is a lot of trial and error. Many CEO’s chide social networks as child’s play. Or, they are afraid of the risks using them. However, the risk of not using them is greater. Once put into play, there is no doubt mistakes will be made. But the community is pretty forgiving, since they are making the same mistakes.
Business tends to put a lot of emphasis on math skills. They are important, but being able to speak, and now write, effectively are skills that are just as critical.
I neglected to mention Google+. I am not sure about it. The hang out feature is cool, but for a company I believe a network like Yammer might be better. Yammer offers the company a bit more control. Google’s Twitter like features are good-but more of a benefit to smaller companies and individuals than large multi-national organizations that want focus.