Following up on my previous Blog in which I championed having rules in place for how Directors use social media and technology for their Board duties, this Blog asserts that Board in consumer product or services industries should have a Director who is a tech savvy marketer. The internet, mobile media and social media are so prevalent in every part of our lives, that a Company which does not have at least one Director who has a strong understanding and hands on experience with those technologies an marketing tools is doing itself a huge disservice. In my book (BrainTrust Boards), I argue that having a marketer on the Board is a necessity if your company sells anything to the public, or a subset of the general public (whether you sell household products, legal services, tax preparation services, software, car parts, or pharmaceuticals). As I discuss in the book, the Board needs directors who have a direct connection with the world outside the Company, can see new developments in other industries and technologies that can be applied to the Company. More and more, not only do you need a marketing expert, but one that is also savvy in social media marketing (the dos and don’ts and emerging marketing techniques linked to social media). Get in touch with the real world that your Company has to live and compete in – make sure you get a Director on your Board with expertise in Marketing and the new technology and media driving consumer opinion and purchasing now.
Archive for 'Education'
Boards should have a Social Media policy for themselves. As we learned in the Rock Center survey on social media (see Blog: Boards & Social Media Part 1), some Directors use social media in the personal and business context, others only in the personal context, others not at all. You should have guidelines in place both for the protection of the Company, but also for the protection of the Directors. Because Social Media is relatively new to the world of business (& Boards in particular), Boards have not integrated rules around usage of social media into their governance rules or ethics rules. A Social Media policy can be a ‘stand alone’ policy or covered within Boards’ other governance & ethics rules. Regardless of how it is documented, it should be documented and the Directors versed in the rules. As most of us know too well from experience, it is far to easy these days to type something in a moment of anger or without properly proofreading, and with a too quickly push of a button send an email out that is embarrassing, regretful or even damning. And that is just with email, with FB, LI and Twitter, a mistaken tap of a button could have that embarrassing or incorrect statement broadcast to thousands of people (clients, customers, shareholders, news media, employees, etc…) and cause havoc, loss of reputation and potential liability. Don’t be that Director or that Company; get the rules in place upfront and make sure the Directors stay abreast of the developing social media platforms and technology.
The Conference Board and the Rock Center for Corporate Governance at Stanford University issued the results of their survey of executives and board members in North American companies regarding their views of social media earlier this year.
After discussing the potential benefits of social media (ability to: engage closely with and collaborate among stakeholder; gather information inexpensively and quickly on market, competitors, products and stakeholders; and disseminate information quickly) and risks (loss of control over company and product branding, reputation, proprietary information; potential for quick spread of misinformation to market and stakeholders), the report proceeds to show the feedback from executives and directors on their knowledge and use of social media. The vast majority were familiar with the names of the largest social media sites (Facebook, Twitter, LinkedIn, Google+, etc.). 13% did not have a social media account. The most common site that the respondents had accounts on was LinkedIn (80.4%). 41.3% said that they used LinkedIn most frequently and 17.9% said they used Facebook most frequently. The results also said that the respondents used social media for personal purposes and business purposes. I thought that was rather predictable and no surprise.
What I found interesting, however, is that 76.4% said that their company used social media to support or promote its business, but 65.6% said that their company does not use information gathered from social media as part of key performance measures to track the success of business activities. Also, 50% said that they do not use social media to monitor potential risks to business activities, and 17.65 did not know if social media was used in the rick monitoring process.
Furthermore, at the Board level, 90.7% said that the Board has no oversight over social media monitoring efforts, and 85.8% said that the Board does NOT receive any reports containing summary information and metrics from social media. Even more surprising for me is that 55.5% of senior management does NOT receive any reports containing summary information and metrics from social media. Those results did surprise me. In this digital age and rampant social media use, I would have thought that all senior managers not only received reports, but had input as well to the social media strategy.
Boards should be more aware of not only what their company is sending out through social media, but also the information and metrics that can be gathered with social media. Not paying attention to something like the company’s social media strategy, its results and the strategies and results of the company’s competitors (and potential competitors) can cause the company to loose control, among other things, of their brand, market sentiment and the direction of their industry.