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06.28.07


Why Business Needs To Engage In Social Media

By Shel Holtz

Paul Argenti's excellent keynote talk at the IABC Research Foundation luncheon today included a few references to social media, but mainly these addressed the impact of social media on public perceptions of organizations.

When he spoke about corporate communication, he spoke specifically about an organization's effort's to communicate to constituencies, never about communicating with them. I don't have a huge problem with this; after all, an organization's use of social media should augment, not replace, conventional communication. Each channel should be employed based on its strength.

Nevertheless, the bulk of Argenti's talk could serve as a primer to explain to executives why their organization's should embrace social media.

Argenti, who has taught management and corporate communication at Harvard Business School, COlumbia Business School, Dartmouth, the International University of Japan, and several others, is also an author and consultant. He's also (wisely) fixated on research and measurement, which means he offered numbers to support his assertions. I'll summarize and add my own comments about the connection between Argenti's remarks and the case for social
media.

He began by noting the Western envrionment for business is uncertain, presenting a chart showing the public response to this question: "Does business act responsibly?" His numbers consolidated three studies, from Yankelovich, CNN/USA Today, and Gallup. The numbers below represent the percentage of respondents who said "yes."

1968 - 70%

1976 - 15%

1985 - 30%

1999 - 28%

2006 - 16%

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Yep, that one-way, top-down communication style definitely seems to be working for business, doesn't it? According to Argenti, the turning point after the comforting numbers of the late 60s was not Watergate or the Vietnam War protests-which were political but not business-focused-was the oil and gasoline crisis. Since then, some of the best-known examples of formal organizational communication have been characterized by deliberate efforts to mislead, including (but by no means limited to)...

  Enron, which misrepresented its reality and its values

  Arthur Andersen, which disregarded regulations and the clear signals that it was acting inappropriately

  Tyco, whose CEO misused company funds to throw lavish personal parties

  Martha Stewart, who lied an obstructed justice (rather than simply say, "Oops, I messed up)

  British Petroleum, whose green talk was seen as false

  KPMG, which created illegal tax shelters for its clients

These high-profile communications have led many in the media-such as Newsweek writer Allan Sloan-to begin characterizing the situation as the big, bad corporation versus the poor, downtrodden little guy. (Argenti noted that nobody rooted for PG&E; all the cheers were for Erin Brockovich.) This exacerbated the perception that business couldn't be trusted, as in the results of this study that found...

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About the Author:
Shel Holtz is principal of Holtz Communication + Technology which focuses on helping organizations apply online communication capabilities to their strategic organizational communications.

As a professional communicator, Shel also writes the blog a shel of my former self.

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