Why you shouldn't write off Facebook

Facebook's lacklustre IPO shouldn't turn execs off the potential of the social media.

“Let’s bring Facebook inside!”  was a common strategy for enterprises adopting social media.  Executives looked at the size, scale, energy and engagement of people on Facebook and wanted to replicate that in their organisations.  Creating collaboration, an employee directory, personal pages, team pages and the like represented the extent of social media strategy.

I hope that executives who chased Facebook as a concept recognise the difference between the share price of a public company and the strategic value of social media based mass collaboration.

It is early days and there are technical, market hype, media hype and other factors at play that will still have to work out.  Facebook’s lacklustre initial IPO performance highlights the difference between running a social media business and realising value in your business through social media.

Facebook is a social media business running a basic aggregation and advertise business model.  Bring a whole bunch of people together and then sell access and an ad to them is the basis for Facebook and Google’s business model.  The funny thing is, as Anthony Bradley likes to point out, we created Facebook.  We are the ones putting up pages, liking things, making connections, etc.  That content is what keeps us coming back.  It is the basis for the attention we all give and time we spend on the platform that Facebook seeks to monetise.

The success of Facebook’s business model requires capturing, keeping and monetising that audience and while that audience is huge and Facebook’s ad revenue tiny compared to total ad spending connecting the two to drive growth is challenging.  That is Facebook’s business challenge and their success or struggle remains to be seen.

Facebook’s business challenge in a social media business is not the same as your organisations challenges using social media and mass collaboration.

Keeping the two separate is important as the media attention turns to making that business model work.

Your business is not the same as Facebook’s business. So Facebook’s business challenges are not your challenges. Equating the two is weak logic.

Your business is your business and it can benefit from adopting social media technologies to achieve meaningful business purposes via mass collaboration.   Anthony Bradley and myself discuss how in our book “The Social Organisation.”  But more importantly, your application of social media technology is fundamentally different than Facebook’s business based on social media technology.

In many ways your organisation is better structured to gain real, meaningful and sustained benefit from social media as revenue based on advertising is fickle.  The ingredients that give you that social advantage include:

  • Shared purpose within your organisation, its commitment to customers, and investments in each other.   Facebook is 900 million people fragmented into different sized clusters, interests, familial and other relationships.  Mobilising that number of people, even to just sell advertising is a significant endeavor. Your organisation is an entity, has a culture, works together on a regular and detailed basis.
  • Manageable and meaningful purposes exist within your organisation based on its goals, objectives, mission, vision etc.  Your people, your organisation can formulate purposes that draw people together, create observable results and engage customers, associates and others in ways that lead to greater collaboration and innovation.
  • Deep information, experience, knowledge and energy based on tying to people’s professional and personal interests that fuel participation, contribution and judgment.  You can tackle more complex, challenging and persistent issues as the social network within your organisation and with your customers has the resources to make significant and real progress.

These factors represent the strength of applying social media and mass collaboration within your organisation to achieve your organisation’s purposes.  You do not have to assemble an audience, you do not have to sell access to them.  Rather you are looking for ways to engage them, their experience, insight and energy to achieve something meaningful and beneficial to participants and your organisation alike.  A very different business purpose and goal for social media.

While your organisation will share much of the same type of technology as Facebook, you are applying that technology to a different business purpose and that difference – found in the purposes you seek via social media – should be the basis for your continued progress on becoming a social organisation, not Facebook’s share price regardless of where is lands.

Mark McDonald is a group vice president and head of research in Gartner Executive Programs




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