Social Media in Business – Issues and Challenges

Social media have developed so fast that many businesses have been left behind and are scrambling to develop clear strategies across their organisations.

One very important concept around the use of social media in business is social capital and trust. Trust is generally based on a relationship, for example buyer and seller (Kennedy & Sakaguchi, 2009), but in the world of social media this trust is generalised trust of other members of society.

Source: socialauditnetwork

The origin of this generalised trust is social capital, described as shared values and understandings that enable individuals and groups to trust each other work together (OECD Insights).

Another important aspect to look at  when introducing social media into an organisation is the business culture.

It is vitally important that cultural considerations are taken into account when a business introduces social media (Podcast featuring Christine Eberle). Organisations are generally composed of multiple generations who need to work together.

Source: LinkedIn

While the millennial generation tend to be more collaborative in their outlook, it is the older generations who have the content expertise, so social media needs to be used by everyone for it to be successful in a business environment.

There can also be executive resistance to introducing social media into the business environment. There maybe fears of reduced productivity if social media are freely available in the workplace, and also that employees writing on message boards could present a legal challenge.

Research has found that these fears are largely unfounded (Christine Eberle) and productivity actually increases with the use of social media. People can be connected more easily if they are geographically separated and it allows more connection  between the generations.

If everyone in an organisation makes use of social media, growth and creativity can be encouraged, as well as communication throughout the organisation.

On the flip side, the power of social media can cause major public relations issues for organisations or even cause their shares prices to fall. For example, the recent public condemnation of  United Airlines caused by a passenger filming an incident on a smart phone and posting it to social media (full story here). As a flow on effect from this many other people shared their stories of similar situations on other airlines.


Another example is hotel and restaurant ratings by customers on websites such as TripAdvisor. Anyone can post a review on these sites so the business owners need to be aware of this. For big organisations it is advisable to have a team that monitors social media and uses data mining techniques to find and deal with any issues before they become major problems.

Research has shown that the use of social media is still experimental and ad hoc  across a number of countries rather than being strategic (Macnamara & Zerfass, 2012). Social media communication has no clear objectives and is not integrated with other types of communication in many instances.

While organisations cannot engage in social media in an unmanaged way that would be contrary to regulations and stakeholder interests, there has to be a balance between participation and effectiveness.

Social media is a vital means of marketing, promotion, and conducting business in the 21st century (Mello, 2012) so they need to be embraced by all businesses in the current competitive world market.

Kennedy, M. & Sakaguchi, T.  (2009).  Chapter XII Trust in social networking: Definitions from a global, culture viewpoint.  In C. Romm-Livermore & K. Setzekorn.  Social networking communities and e-dating services:  Concepts and implications (pp. 225-238).  Hershey, NY: Information Science Reference.

Macnamara, J. & Zerfass, A. (2012). Social media communication in organizations: The challenges of balancing openness, strategy, and managementInternational Journal of Strategic Communication, 6(4), 287-308.

Mello, J. A. (2012). Social media, employee privacy and concerted activity: Brave new world or big brother? Labor Law Journal, 63 (3), 165-173, Retrieved from Business Source Complete Database


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