Social Media Risk: What it Means to Your Risk Profile
Social media platforms and applications have been implemented rapidly by most organizations over the past decade. New ways to utilize social media crop up weekly and new social media tools seem to hit the market just as frequently.
Social media is a compendium of highlighted accessible media: corporate blogs, video-sharing sites such as YouTube, social networks like Facebook, microblogging tools such as Twitter, rating/review sites, wikis (knowledge base websites that allow several authors to simultaneously edit and create), and crowdsourcing, among others. This media leverages the power of the internet, web 2.0 and mobile technologies to facilitate the creation, exchange, use and modification of user-generated content to connect people. The convergence of these technologies is forever altering the dynamics of customer relationship management, marketing and corporate communications for many businesses.
Key Considerations
Social business is about leveraging social media to accomplish business objectives. It embeds social tools in many business processes, connecting people to people, people to information and data to insight. Social business “communities” enable companies to listen and learn from customers, satisfied or dissatisfied, regarding their experiences. They also provide opportunities for product development teams to obtain early input from potential buyer groups on new product plans, from marketing to testing messaging, and for companies to educate and inform customers on product uses and applications.
While these developments present significant opportunities for companies to connect with their customers and others, they are also creating a whole new set of potential risks for companies to monitor.
The following social media risks should be considered:
- Loss of intellectual property and sensitive data
- Compliance violations
- Reputation loss
- Financial disclosures
- Effects on human resources
- Inability to manage the “technology divide”
- Safety loss
- Competitor risk
- Brand hijacking
- Poor management of social business community forums
The above list of business risks is not intended to be all-inclusive to suggest that companies should not use social business. Each company will need to assess the risk of social business and determine appropriate methods to monitor and, if necessary, mitigate the risks. The bigger risk could be not using social business at all. Other risks may arise due to a company’s specific situation and use of social business, highlighting the need for organizations to include social business capabilities in their risk assessment and management efforts.
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