This’s post is from Liz Ruskin, contributing editor of SmartBrief on Leadership.
Corporate leaders fear what people might say if given a voice on social media, but once a business builds a community — among its customers, employees and other constituents — it opens itself to more innovation, gets more from its human capital, turns customers into loved ones and wins the adoration of investors.
Or so claims Mzinga CEO Barry Libert. Of course he would say that: Mzinga creates social networks for 
businesses, including ABC, Amway, Johnson & Johnson and Deutsche Post. Commercial interest aside, he made an unusual and compelling argument that goes to the heart of what social media could mean in a business environment.
All businesses — whether they make cars, serve coffee or supply paper — must meet the basic need humans have for connection with one another, he claims. “GM never thought of themselves of being in the business of connecting people, which is why they’re going bankrupt,” he told participants at the Milken Institute Global Conference in Los Angeles on Wednesday. (Long before the advent of the Internet, GM should have been listening to customers, rewarding them for loyalty and inviting them to share the joy with their friends and family, he says.)
Fear makes big business reluctant to deploy social media — an obvious problem for his business model, which depends on companies paying Mzinga to establish and manage their social media networks.
Ultimately, he says, companies are run by people, and no CEO wants to appear vulnerable, either in public or in the internal community of the business. “The frailty of humanity is, I’m frightened to hear about me, and as long it’s my business I don’t have to,” he said. The problem is more acute among male executives because they don’t like to share, he says. “As long as guys run businesses, sharing and collaboration and social interactions is going to be tough for most businesses, so we’ll see.”
Once business adopts social media full-on, the very nature of leadership and human engagement will change, he maintains. Learn more in this video.
Photo credit, iStock
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I totally relate to this article. I have seen so many CEO's go down this route even going so far as to block internet access to websites that had negative comments about them or the Company. They feared that the employees would read negative news about the Company and bail.
It takes a STRONG CEO to introduce social media into their Companies. To allow the freedom to think, innovate and grow. If you are working for, or are trying to pitch SM to a pansy CEO, don't waste your time.
Michael McDermott
bashfoo.org
This is a great article, but it’s important to remember that Social Media is not for everyone and certainly not for all businesses.
The point of Social Media is to hold great conversations around great content. The great conversations then become their own form of great content and the cycle continues.
Businesses without much to say, or an overly strict policy concerning what marketing is and which conversations are okay to hold are doomed to failure in the social media realm. As are those who are just doing it because it’s trendy.
The right approach is KEY.
-Nick Armstrong
PsychoticResumes.com
Interesting point of view. However, interesting but not relevant. I’d love to know what empirical data is basing this conclusion on, or if it is simply an opinion. If it is an opinion, then he should state it as such. This is presented as fact.
In doing my own back of the napkin research (with people I know personally, sit on boards with, etc.), I asked 2 CEO’s who are male, 2 who are female, a BOD (& former CIO) member who is male and a (male) CMO (who reported directly into three male CEO’s).
All are affiliated with F500 companies. I asked the question ‘Are you/is your CEO hostile to Social Networks?’ I also shared Barry’s point of view. Three laughed and one asked if I was kidding or genuinely serious…somebody actually said that with a straight face?
The consensus was that Social Networking or Media needs to better map to the mandate of the CEO. This is profitability, growth, operational efficiency (and in public companies), shareholder value. Plain and simple. Customer experience is in this mix but not as a separate line item in most cases. Most CEO’s aren’t afraid of anything that helps them achieve their goals. They just need to understand in crisp BUSINESS TERMS, not marketing or social media-speak, how this happens and how it is measured. The CEO doesn’t live or work within the marketing echo chamber, so they have a cursory understanding of how these things work, frankly, they don’t care, they leave that to others. They have short, laser focused attention spans and in most cases, finely tuned BS meters (translation: they believe about half of what marketers/advertising people tell them. What matters is the end result.
So, again. This is an interesting point of view (opinion) but not relevant.
Nielsen findings suggest that majority leave Twitter just after a month. Most others are not too careful about who they follow after linking the "Follow". On an average Twitter users are following 200+ Tweets, a crowd of Tweets, typically impossible to keep a track of.
Having said that.. the almost loss of market share by MySpace after the sell-out proves that extra commercialization of social media does not go too well with the audience. The reason behind this mostly is the fact that it holds strength among people ((who bring the "social" in social media)) because it gives them the perception of control.
Maybe cynical, but the over-trust that corporates are throwing in the arena of social media is a deterring proposition, which does not spell a long term establishment for their brand.
Wonder how far this hype of social media will last, with no grounded foundation that was enjoyed by the conventional media at the time of its evolution.
[...] Why CEOs are hostile to social networking [...]
Wrong. You forgot that people really are different. Some folks like to interact with others; some don’t. Others love words written and spoken ..and love to hear themselves wax eloquently. Some of us like numbers; other excel in use of the hands or body. Marketing folks and social networking types like words and think that everyone else does too. We don’t.
CEO’s and companies must embrace social media. internally and externally. companies that do not embrace this will become irrelevant.
We are entering a new age of highly collaborative and proactive organizations. @MediaTrust we are very active in the social media and use it to message out and create feed back loops from our advertiser and publisher community so we can address their needs. This allows us to develop technology for our community/ with our community.
It is very powerful and works. Leaders and companies need to embrace transparency. It will make them more dynamic and trusted organizations and CEO’s
this is a very good post and topic. thanks!
Peter Bordes
CEO
@Mediatrust
@mediatrustpete
I’m encouraged by the conversation on this topic, and appreciate the dialogue resulting from my panel discussion at the Milken event. I’ve been presenting and writing about the impacts of social media and networking on leadership and business since 2001. To clarify my comments:
• Application of social technologies to enterprises: Virtually any business can use social software to attain real and tangible benefits (including measurable ROI) that map to their most critical business processes – including marketing, employee development, and customer support.
• Importance of leadership: Social software changes almost all traditional business processes as well as today’s theories about management. As a result, to truly take advantage of social software, leaders need to evaluate how they are currently operating and managing their businesses to ensure that their existing styles of management enables and embraces the full benefits that social software and social interactions offer enterprises.
• Generalizations don’t apply to everyone: However, in my experience as an ex- Mckinsey and Andersen consultant, I’ve found that businessmen have real fears about relinquishing control when it comes to transformative technologies. I realize that’s a controversial comment, and it’s not meant to be offensive as much as it meant to be an observation that needs to be considered as social software and social interactions invade the workplace.
The bottom line – Research confirms that there are fundamental differences between the way men and women communicate and lead, and in an increasingly ‘social’ world, we can all learn AND benefit from those differences. The result: a more open and honest dialogue about the future of leadership and management based on today’s more socially enabled, collaborative, and connected world.
Barry Libert
Mzinga Chairman and CEO
@blibert
This is a good example of when you’re a hammer everything is a nail. GM bankrupt because of this? If only GM had an awesome blog and a community of customers with nothing better to do with their time, alas things would be different. Call me crazy, but I want to transact with my car supplier, not form life long bonds with others who happen to have made the same purchase. I can buy it for niche cars like Subaru, but mass cars?
[...] was reading a post over at SmartBlog on Social Media and it had a quote by the Mzinga CEO Barry Libert: “GM never thought of themselves of being in [...]
[...] Building a Social Community in business can work for or against you. Companies today must monitor Social Community platforms for customer complaints or feedback before it is too late to do something and address it. One of the elements of Social Community is customer dissatisfaction is viral and can cause damage to a brand quickly. Learn more http://smartblogs.com/socialmedia/2009/04/29/why-business-is-hostile-to-social-networking/ [...]
[...] Read the full story SHARETHIS.addEntry({ title: “Why business is hostile to social networking”, url: “http://www.idgknowledgehub.com/blogs/?p=351″ }); Trackback URL Permalink [...]
[...] was reading a post over at SmartBlog on Social Media and it had a quote by the Mzinga CEO Barry Libert: “GM never thought of themselves of being in [...]
[...] SmartBlog On Social Media » Why business is hostile to social networking smartblogs.com/socialmedia/2009/04/29/why-business-is-hostile-to-social-networking – view page – cached Corporate leaders fear what people might say if given a voice on social media, but once a business builds a community — among its customers, employees and other constituents — it opens itself to more innovation, gets more from its human capital, turns customers into loved ones and wins the adoration of investors. — From the page [...]
[...] SmartBlog On Social Media » Why business is hostile to social networking smartblogs.com/socialmedia/2009/04/29/why-business-is-hostile-to-social-networking – view page – cached Corporate leaders fear what people might say if given a voice on social media, but once a business builds a community — among its customers, employees and other constituents — it opens itself to more innovation, gets more from its human capital, turns customers into loved ones and wins the adoration of investors. — From the page [...]