Saturday, May 8, 2010

Social media, a deadly place for corporations

The starting point of this reflection is the fact that corporations are going full speed and head first into the new social media hype. They are using these new tools to engage the masses in the process of design, evaluation, and marketing. The goal is to understand the dangers corporations are facing in engaging the masses through social media. I am getting my "data" from different social media outlets (forums, mailing lists...) where executives exchange ideas on how to best use the new technology to gain market share and to increase profits.

The "2020 Social Workshop on Social Media for Non-Pofits" article bellow explains why the adoption of the new media will gradually kill the corporation. In this article I explore another class of adverse effects.

Two important observations
  • companies don't control this new media (the social media)
  • the message is spreading through multipliers or evangelists which are not part of the organization

The social media space can become a bloody battleground for corporations
No one controls social media. Anyone can spread his own ideas at very small costs. Anyone can pollute your message, anyone can directly attack you. Moreover, social media is not regulated like the classical media. You cannot sue Facebook because a group of people wrote negative comments about your company, and freedom of speech is applied differently on social media than on classical media. It is very possible to see social media becoming a battleground for corporations (individualistic and highly competitive entities, not very keen on sharing, openness, and collaboration), leading to a carnage. Because they can, because it is possible, and because it costs almost nothing, some corporations might choose to attack their competitors using social media. They can decide to take a hidden approach by inciting other entities to carry out the actions, for example to pollute their competitor's marketing campaign, to incite other groups to boycott their competitor's products by providing them with negative information about it, etc. Or they can take a more direct approach, putting themselves in front of their actions. Dirty fights are seen in classical media, I think social media is the perfect breeding ground for this sort of actions.

This is actually good news for those of us who don't believe in hierarchies (hierarchically structured private endeavors). Open and collaborative systems are now competing with classical hierarchies, in this new environment shaped by the new technology. The new technology rewards collaborative networks to the detriment of individualistic and overly competitive hierarchical organizations, because it naturally enhances sharing and cooperation. On top of that, it seams that this new environment might encourage hierarchies, that is corporations, to express their individualistic and overly competitive nature by killing each other on the open "piazza".

The same social media can be used by the public against a corporation
How can a corporation with a bad reputation survive against a swarm of activists behind its tail? As corporations learn how to use social media to increase their profits, activists also learn how to use the same technology to attack corporations. The question is, given the nature of this new technology, who can extract more potential from it? Who will benefit the most?

After thousands of years of social evolution good ethics still rules the world. Even though, in most cases, bad people are running our societies, good ethics is what keeps societies together, and these corrupt leaders go through a lot of trouble to convince their subjects that they stand on the right side. The Internet technology transforms the entire planet into a small village, in the sense that anyone has access to who you are and to your past. This is especially true for public entities like a corporation. It is hard to hide if you are a really bad guy. Until recently, in a large city, one could screw someone here and hide in anonymity two blocks away. That is because one could get away with it, because people didn't have easy access to who the identity of the individual. Thus, if the gains are larger than the risk involved the individual can repeat his immoral actions, and even get imitated by others. In a small village setting, everyone knows everyone else. If someone screws someone else once his ability to screw anyone else again drops dramatically. One's ability to extract advantages from his community diminishes after a bad move, because people will marginalize this individual. So everyone gets it: if you screw someone you'll be shunned, it's not worth it...

That's why crime is low in small communities, not because people are different there, but because good behavior is reinforced by the way people are constrained to interact with each other. In the small village context, reputation becomes a very important asset and it is measured against accepted ethical norms. The same regulating mechanism operates in a highly interconnected world, i.e. in a world with Internet. If a company knowingly sells an unsafe product sooner or later this will come out, and a few dedicated individuals can literally bring this company down. A few passionate individuals have the means to destroy its reputation using the same social media it is using to market its products. See the Boomerang, a new way to fight work related injustice, how one person can take on a corporation.

In my opinion, by transforming the world into a small village the Internet forces economical entities to act ethically, or at least according to what the majority perceives as good ethics.  

By AllOfUs