Social media: coming to a boardroom near you…

You may (or not) agree with me, but social media could be reaching the tipping point in becoming the major influencer in the way decisions are made in corporate boardrooms.  What I mean by tipping point is similar to reaching critical mass in technology adoption: the point at which adoption becomes self-reinforcing. I tipped to this point, so to speak, after I read The Importance of Compensation post on The Baseline Scenario.  The post and its responses are brilliant in dissecting what went wrong with the way boards handled compensation, resulting in excessive risk-taking by company executives.  And when it comes to compensation, the spotlight is on boards, because that’s where compensation is set.

Many surveys confirm that businesses, especially in non-tech sectors, have been slow to engage in social media.  It’s hard to give up the old broadcast media paradigm, which was tailor-made for the command-and-control style of management.  As Anthony Goodman writes in Financial Times, “Every chief executive and board member will say that ‘tone at the top’ is critical to a business, particularly in turbulent times.” The stentorian approach does not lend itself well to the new media.  The voice at the bottom, multiplied by social media, counts in times of crisis too.

I have a theory why social media had such a hard time in the executive office and it has something to do with names.  “Social media” is unlikely to fire up executive testosterone the way that “deadly force media” would make them pay attention.  Just think of how many corporations have “war rooms,” where the deadliest weapon is a whiteboard with markers. Twitter, one of the most powerful tools in the social media arsenal, comes with a bird on its home page.  Viral networks sound a lot more serious than social networks, especially considering the recent attention on the swine flu virus.  I’m absolutely excited about Google’s Wave possibilities.  Again, “Wave” is not something that the war-room crowd can envision without taking a tranquilizer or two.

Despite the initial resistance, social media have already changed the way businesses communicate.  Some may even argue that new media will impact corporate structures, because social media are changing relationships with customers, shareholders and communities where businesses operate.  Just think for a moment of shareholders as a special interest group.  Now imagine the special interest group forming an online community capable of interacting with senior executives and board members in a way it never did before.  Instead of waiting for an annual meeting, they will engage the head of compensation committee in a conversation that doesn’t allow the chairperson to shut it down as easily as he or she could during a once-a-year meeting.  So this begs a question: does your board have a social media strategy?  Because if it doesn’t, the one elected after the next annual meeting will…

Social media and blowing smoke at Starbucks

Adam Broitman’s piece in iMedia Connection – “Social media: whose job is it anyway? – asked six thought leaders to define social media.

Here are their responses:

1. Social Media is the creation, sharing, and commenting on digital content.

2. The sharing of information between people.

3. Any form of media that alows for immediate, public consumer response that’s incorporated into the content produced.

4. Social media is media in any form for any platform created by, for, and with consumers.

5. Social media is simply talking *with* — not at — your constituencies (customers, friends, partners, prospects, etc.) & engaging them online.

6. Tools and processes used to connect, share, and to organize and collaborate with others.

Twitter rules were followed, so each answer had to be 140 characters or less. If Twitter had more characters, perhaps they may have expanded their answers to include social activism, but answer #5 covers it best from my perspective, with one caveat: without the right message (content) and strategy, you’re not going get results with social media.

PR Week Breakfast Briefing had an interesting item about a social media campaign reported by Los Angeles Times this morning. Starbucks Chief Executive Howard Schultz was targeted as anti-union, with his company exploiting workers. The campaign – launched last week by Brave New Films of Culver City – has its own website, stopstarbucks.com, and a video called “What do Starbucks and Wal-Mart have in common?” The video should be watched by every corporate and executive communications department.
It starts with Mr. Schultz’s interview on 60 Minutes, which goes downhill for him in a blink of an eye, thanks to Scott Pelley, the 60 Minutes correspondent.
While the interview was generally favorable to Starbucks, Mr. Pelley zeroed in on a Starbucks’ message that had come back to haunt them:

“One of our colleagues coined a phrase a long time ago and said, ‘We’re not in the business of filling bellies.
We’re in the business of filling souls,’” says Schultz.

“Oh now, come on,” says Pelley. “No wait a minute. That’s too … this is a company. This is a corporation. Come on.”

“OK, it is a corporation,” Schultz acknowledges.

“You’re blowing smoke now,” Pelley replies.

Now, the Vatican may get away with saying it’s in the business of filling souls, with a little smoke as a part of the ritual, but Starbucks? Ten years ago, the interview would have been sitting in the archives. But thanks to new media, it became an opening line in the union organizing effort, exploited brilliantly by the smart people at Brave New Films. By using social media, including Twitter, to hijack Starbucks’ own campaign, the union-organizing effort may or may not succeed. But consider this: the video was watched by nearly 40,000 people and an online petition demanding that Schultz “quit following Wal-Mart’s anti-union example” was signed by 12,000 people. And the damage to Starbucks reputation? Now that’s something to think about before you write the next, hopefully not a nebulous, message for your CEO without a proof point.

An Essential List for Corporate PR

If anybody has any illusions that this recession is going to be just like the last two, here is something to change your mind. The U.S. gross domestic product decreased at a seasonally adjusted 6.2% annual rate in the fourth quarter of last year, way more than anybody expected, according to an article in the Wall Street Journal online.  The U.S. Department of Labor reports that 598,000 jobs were lost in January alone. It should not come as a surprise that every big PR agency already stated that 2009 would be tough.  Corporate PR won’t be spared from the wrath of the downturn either. Here’s a list of five critical factors to keep in mind in these demanding times.

#1 – Content

Content in PR, like cash to every business in recession, is king. Your company will still need press releases, your executives still give speeches and presentations, your website still needs new content. And, let’s not forget, social media without content is about as useful as a hole in the head. Content is absolutely essential to your business. Make sure you have people on your staff who can write and edit. You can hire outside help if absolutely necessary, just keep in mind that consultants are less than welcome when your business is suffering. The Financial Times reported last month that Siemens issued a ban on external consultants, hoping to save $386 million.

#2 – Deliver & Report

Deliver results and make sure that your senior executives know what you delivered. We all know that statistics play well, just keep in mind that not everything that can be counted counts, and not everything that counts can be counted. Your CXOs’ speeches are remembered longer than most statistics and speeches are amazingly cost-effective for reaching your customers and other key stakeholders. Produce monthly reports, but keep them short. Anything longer than a page gets far less attention than a well-written summary.

 #3 – Extend Your Reach

We are, above all, communicators and our functional expertise and skills are essential for media relations as much as they are for internal and customer communications. Help your sales and marketing people with RFPs and RFIs. Make them stand out over your competition with clear writing and appealing visuals. Work with your HR department to improve communications with employees. Help your investor relations with better presentations. Offer your board members help with their presentations as well.

#4 – Maximize Your Channels

Maximize social media. As my colleague Mark Evans says, there are a growing number of social media that companies can use to extend their messages in new and different ways. This ranges from blogs and Twitter to video and Facebook. The key is determining the social media tools that meet your strategic needs, and then committing the resources and time to leverage them effectively.

#5 – Downsize Right

Create the worst-case scenario model to find out what is absolutely essential to deliver basic PR to your business if you have to lay people off. Keep in mind that, under Sorbanes-Oxley, companies are required to meet certain communications standards. Consider short and long-term contracts for people you want back when this recession is over. Because like all other downturns this one will end eventually.  

Social Media for Executives

You wouldn’t believe who is on Twitter these days.  According to an article in today’s Economist, members of the US Congress are now twittering happily to each other and their constituents.

Everybody and his neighbour is blogging and one hears complaints about too many professional social networking websites like LinkedIn.  Even the most skeptical naysayers agree, social media are now ubiquitous and an integral part of business communication channels.  Frankly, I’m glad we’re past the acceptance stage when evangelists hyped social media almost as much as they did the Internet in the late 90s.

I recently asked a social media-savvy corporate lawyer, “Would you let your CEO write his own blog?”  “About as much as we would let him write his own speeches and press releases,” she answered.   You may argue that the need for disclosure would make CEOs’ blogs less “personal,” but the same argument may apply to their speeches.  Most CEOs spend time with their speechwriters to make sure that they actually talk their walk.

What is even more critical for businesses is social media monitoring.  Nothing can organize your customers and adversaries as effectively and quickly as social media.  Company boards should be especially advised of any changes in the online chatter because they have been increasingly targeted for perceived transgressions.

By the way, the Economist article also notes that Republicans twitter more than Democrats.  I called my friend in California to get her take: “Twitter can only take 140 characters.  When they expand it to two pages, dems will take over.” Right.