May 292013
 
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Australian CEOs are negligent in refusing to come to grips with Social Media, and their PR Media trainers are negligent in not training them to understand the impact of their communications in social networks.

WHEN Myer CEO Bernie Brookes said last week that an increased Medicare levy to fund the National Disabilities Insurance Scheme NDIS would be bad for business, it reminded that while public relations professionals have done a good job of training CEOs in some ways, they have done a bad job in others. the-australian-newspaper

There is no doubt PR professionals do a great job of training their CEOs to speak to business, to shareholders, to board members – but they do a lousy job of preparing the boss for social media. The backlash on Myer’s Facebook Page, the tweets from the public and celebrities alike on Twitter, and other social media sites was staggering.

The Myer Facebook Page has 190,000 subscribers. However the Page usually only gains about 23 comments per post. Not now. The comments are in the hundreds and at least one of those comments collected a whopping 200 Likes within 4 hours. On Twitter, the #BoycottMyer hashtag has been used by thousands of people. One tweet sent out at 9pm on Tuesday night had by Wednesday morning been retweeted 260+ times.

It probably won’t surprise you to know that as I write this article, I am watching Myer’s stock, in real time, drop as the social media viral effect takes hold. On the day of the comments alone, it fell about 4 per cent. Can CEOs really afford to be oblivious to social media?

It is no longer enough for a CEO to be the talking head to journalists and shareholders. They must now provide the vision, strategy and values direct to consumers as well. It’s now the CEO’s job to juggle both shareholders’ and customers’ values.

Yet, according to IBM’s 2012 Global CEO Study, only 16 per cent of CEOs are on social media. Given that more and more investors are responding to social media discussions, ignoring a direct-to-market channel is surely negligent? In Japan, CEOs are placing chief public relations officers on their board to manage negative criticism, respond to crisis, protect the brand integrity and help ensure the share price bounces back from negative community feedback. Get ready, Australia.

Social media gives CEOs the opportunity to demonstrate that they have vision, to use low-cost, effective communication tools to bring their passion and commitment for their industry to wider audiences, to prove leadership to their community of staff, clients, peers and other stakeholders and to show courage to lead from the front.

If your CEO does not have great communication skills, lacks vision & passion, couldn’t demonstrate knowledge or leadership if their life depended on it, it’s time to get a new CEO. Or start looking for a new job.

Laurel Papworth is a social media educator and a member of Forbes magazine’s ‘Top 50 Social Media Power Influencers’ list globally. Twitter: @silkcharm

 First published in The Australian May 06 2013 (paywall)

Also: ABC NEWS PM http://www.abc.net.au/pm/content/2013/s3750505.htm

And The Finance Quarter on ABC

ABC Finance Quarter social media and ceos laurel papworth

 

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  8 Responses to “CEOs Don’t Understand Social Media The Australian”

  1. The problem is most CEOs have a broader picture of the organization than social media consultants. To a social media consultant, social media is the hammer and every possible problem is the nail.

    CEOs aren’t idiots, they’re pretty smart to get to that position in the first place. Sure, they make mistakes (like all of us) the difference is their mistakes are high profile.

    As for the share price, it was dropping rapidly way before this ‘outrage’. In fact, now it seems to be relatively stable.

    The truth is most social media crises have zero long-term impact upon the organization. Look them up for yourself. There are a few exceptions, for sure, but most simply don’t have any impact. They just give social media consultants something to talk about.

    Now, what this CEO said may not have been very clever. Yet this doesn’t support a conclusion that the CEO must be more involved in social media. Being a CEO is time intensive and social media is still a relatively small (and overrated) part of what an organisation does.

  2. The problem is most CEOs have a broader picture of the organization than social media consultants. To a social media consultant, social media is the hammer and every possible problem is the nail.

    CEOs aren’t idiots, they’re pretty smart to get to that position in the first place. Sure, they make mistakes (like all of us) the difference is their mistakes are high profile.

    As for the share price, it was dropping rapidly way before this ‘outrage’. In fact, now it seems to be relatively stable.

    The truth is most social media crises have zero long-term impact upon the organization. Look them up for yourself. There are a few exceptions, for sure, but most simply don’t have any impact. They just give social media consultants something to talk about.

    Now, what this CEO said may not have been very clever. Yet this doesn’t support a conclusion that the CEO must be more involved in social media. Being a CEO is time intensive and social media is still a relatively small (and overrated) part of what an organisation does.

    • Hi Richard I agree up to a point. I’m pretty sure that if you take a broader picture of social media ( a term I hate, it’s so much more than media) you can see the impact on banking (p2p), on media (blogs), on retail (etsy) on every industry. Politically stability is threatened by #OccupyGezi or the London Riots or Arab Spring. To dismiss social media as irrelevant is dangerous, and less and less likely at the top C-Suite. To not use a direct to market channel, understand it and maximise it would definitely leave a CEO negligent, given ASIC rulings. Even J&J got caught out on a recall for not using social media. These things have to be understood at the top.
      I know that people cut up their Myers card. I know I haven’t shopped there since (I did walk in, then walked out and went to DJs which is honestly no better). I know it’s a minor thing. Until it’s major. Did you know that 16% of people swapped out their bank loans for community banking last Nov 5th? That’s a lot of money moving from traditional banks to community via #Occupy, in one day.
      Once companies stop using social media as a marketing spam tool and understand how it’s changing their industry, social enterprise will evolve. Otherwise I agree with you – give it to the intern. Until you can’t….

    • Hi Richard I agree up to a point. I’m pretty sure that if you take a broader picture of social media ( a term I hate, it’s so much more than media) you can see the impact on banking (p2p), on media (blogs), on retail (etsy) on every industry. Politically stability is threatened by #OccupyGezi or the London Riots or Arab Spring. To dismiss social media as irrelevant is dangerous, and less and less likely at the top C-Suite. To not use a direct to market channel, understand it and maximise it would definitely leave a CEO negligent, given ASIC rulings. Even J&J got caught out on a recall for not using social media. These things have to be understood at the top.
      I know that people cut up their Myers card. I know I haven’t shopped there since (I did walk in, then walked out and went to DJs which is honestly no better). I know it’s a minor thing. Until it’s major. Did you know that 16% of people swapped out their bank loans for community banking last Nov 5th? That’s a lot of money moving from traditional banks to community via #Occupy, in one day.
      Once companies stop using social media as a marketing spam tool and understand how it’s changing their industry, social enterprise will evolve. Otherwise I agree with you – give it to the intern. Until you can’t….

  3. Totally agree with you that CEO should pay more attention to social media, however, only16% of them seems to care really surprised me.

  4. […] Laurel Papworth of Forbes magazine, in response to Myer issue said, “there is no doubt that PR professionals do a great job of training their CEOs to speak to businesses, to stakeholders, to board members- but they do a lousy job of preparing the boss for social media”. Posting your opinions about something or someone online to be seen by millions of people feels a lot less inhibited than sharing the same thing physically in front of millions of people. Due to the free liberty given to us by social media, it is important for organisations to know their legal risks. […]

  5. […] Wall Street should be monitoring social media. So should companies around the world. Why? Cos we are just too smart as a crowd. The example below is from Tesla community but I betcha we could crowdsource Outsider Trading information on any product or brand or company… (Note: Australian Companies MUST report social media discussions that impact stock) […]

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