Want to know the biggest challenge facing businesses over the next few years? I’ll give you a clue - it’s not the prospect of a GFC Mark II.
While volatile economic conditions will of course constitute a significant hurdle, I believe the biggest threat to corporate prosperity will arise from the increasing power of social media networks. Even as you sit and read this, managers at many levels are trying to understand how they can use these spaces to not only promote their products and services, but to combat the type of widespread brand damage that the medium can facilitate. Indeed, while we have the experience and management models to respond to events like economic downturns, there is absolutely no consensus on how to combat the challenges presented by the likes of Facebook, Youtube, Twitter, as well as the plethora of consumer blogging sites.
Companies need to understand the power of social media and be at the forefront of its exploitation. For example, how can they use social media to communicate with their customers? How can they use it to market themselves and their products in a way that ensures survival? Alternatively, how do they respond to negative or damaging consumer blogs that may arise as a result of a service or product issue? Indeed, you only need to upset one housewife in order for millions of people to be reading about the experience minutes later. And what about the issue of unknown parties posing as a business online and posting erroneous, detrimental, or libelous comments? These are all extremely difficult questions.
As such, managers of the present and future have to be extremely savvy and innovative within these spaces. They need to possess the skills to develop ideas and strategies to not only promote their brand in a rapidly changing and evolving space, but to affect damage limitation in the face of negative sentiment. The prospect of significant and possibly irreparable company damage could well be the price of not facing up to this difficult challenge.
Author: Peter Savas, Director of Service and Logistics, Electrolux Australia