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Gini Dietrich

Should CEOs Spend Time On Social Networking?

By: Gini Dietrich | June 30, 2009 | 
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Did anyone else see the Newsweek article that discusses all the reasons why a CEO should not be on the social networks? The one that says, “the social media advocates have reached the point where they believe that the sun rises and sets on the interactions among their members“?

If not, read it here.

While fully realizing I am not a Fortune 100 CEO (yet), I run a business, I have staff, I have people who have left, I even have employees who have been “sacked”, and there are lots of people out there who don’t find me amusing or intelligent (much to my mother’s dismay).

Yet, I have a presence online because it’s pertinent to the brand and because people want to have access to the people who run the organizations they buy from…they don’t want to talk to the PR department or to customer service. They want to tweet Zappos and know they’re talking to their CEO.

There are CEOs who do a phenomenal job of using the social networks, even though they might have angry shareholders, unhappy customers, and even “sacked” employees.

I don’t agree with the Newsweek article stating that the Fortune 100 CEOs should not be on social networks. Consumers are even more skeptical today of large corporatations and the ONLY person who can change that perception is the CEO. If they’re absent from the discussion, it only is going to create more problems for the companies.

As I always say…this is not Gini Dietrich’s trend. People are moving online, and at rapid paces. It’s time to get out there and communicate with ALL of your constituents.

About Gini Dietrich


Gini Dietrich is the founder and CEO of Arment Dietrich, a Chicago-based integrated marketing communications firm. She is the lead blogger here at Spin Sucks and is the founder of Spin Sucks Pro. She is the co-author of Marketing in the Round and co-host of Inside PR. Her second book, Spin Sucks, is available now.

17 comments
Gini Dietrich
Gini Dietrich

Ira - that is SO TRUE! Like people aren't already saying negative things about you or your company? It's happening. It's always happened. Now you have a way to respond and FIX customer service issues. Finally!

Ira Wolfe
Ira Wolfe

What Newsweek and the CEOs don't get is that a social network exists whether or not the CEOs are engaged in it. All technology has done is expose what formerly was an invisible network. It's the same argument that several clients raise - how will we manage negative comments? Well....do they think the negative comments aren't happening anyway? Ignorance isn't bliss when it comes to brand and reputation management....and if the CEO isn't actively engaged in managing his/her company's brand or reputation, what is he/she doing being CEO?

Gregg
Gregg

I'm imagining most CEOs of Fortune 100 companies are old white guys with more money than the rest of us - and kudos to them! My point being that I'm probably more interested to speak (and tweet) with people that I might relate to on some level, not read this:

@GM_CEO: Should I wear the dock siders or the penny loafers?

I know this really is not what Gini's post (or the original article for that matter) had in mind, but thought I'd add my $.02 in that maybe we don't care whether these "very important people" have to say, and if they truly get the spirit of social media, they'll find their way on there and showcase their own personalities (if they have them).

Brian Conrey
Brian Conrey

Randy's right on the mark. A 'business' is really just a social system, organized around a common set of goals. There are a lot of terms prevalent in our culture, continually emphasized by the constant barrage of 'information' by the media, which dehumanizes these social systems. We hear derogatory talk about 'Corporate America', 'Wall Street', 'the oil companies', and so forth, and suddenly it's you versus a big institution.

Social media re-humanizes these social systems. It gets business back to the fundamental principle of people transacting and building trust with other people.

Paul Segreto
Paul Segreto

Please note: CEOs of franchise organizations also need to be careful not to present inadvertent earnings claims in any social media activities per FTC disclosure laws.

Paul Segreto
Paul Segreto

I would be surprised if any CEO of a publicly-traded company had a social media presence. The reason I say this is because of the SEC and FTC.

The SEC has certain rules about information being presented and disclosed to the public and the CEO would need to be extremely careful as to what he or she communicates, even through his or her own personal social networking efforts. From a liability standpoint, I'm not sure the benefit outweighs the potential downside.

With respect to the FTC, the issue here is the marketing message and how it can and may be perceived. Currently, the FTC is considering guidelines and rules about marketing messages being conveyed through social media. Again, as the leader of a public company, the CEO must tread carefully and, even in conveying a marketing message, must be very careful not to break any SEC rules. Again, the benefits need to be weighed against potential consequences.

All that being said, I stongly believe public companies should have a major presence in social media, including social networking, letting the marketing experts spearhead the activity and content. While doing so, I do believe the CEO could, and should, participate strategically with key, well-defined content, more to enhance the overall effort as opposed to being front and center.

Now the flipside, private companies. I do believe CEOs of private companies need to be as transparent as possible. They're usually the vision and drive behind the company. His or her thoughts and statements lend a great deal of credibility to the company, which ultimately may be defining factors in a customer, client, vendor or partner doing business with the company.

Often, the CEO, is the company which why we see companies named after the Founder and CEO. Many times, the CEO is actually the "commodity" being sold by the company. This is especially true with professional organizations, consulting companies, etc.

Service and product driven companies are different as there are usually consumers or clients as end-users. As such, they rely on the "personal guarantees" of the CEO and that message usually needs to be promoted to drive business. I'm thinking along the lines of George Zimmer, CEO of Men's Wearhouse.

When it's all said and done, there are few, more efficient ways of promoting a business, large or small, than through social media, and social networking. The messages are concise and clear, and often present the human side of the business. And, clients and customers alike, feel more confident "knowing" the CEO and his or her thoughts, feeling more confortable with their decision to do business with the company or organization.

Here's a simple, yet totally unscientific rule of thumb: If a business needs to have the CEO's personal guarantee on loans and lines of credit, then the CEO should be very active in social media and social networking activities. If the company can enter into loan and credit agreements without any personal guarantees, it's best to leave the social media and social networking efforts to the marketing experts.

Teresa
Teresa

Ok, Gini, you know I have something to say about this. I am not a CEO, but try to stay keenly aware of at least what's out there...even if I have not jumped on board.

Point #1: Last week, there was an opposite article written about those CEOs and top executives who are not on social media outlets are missing the boat. The fact is, a company needs to be where it's customers are. Clearly, customers are on social media outlets. If top execs do not feel it necessary to be a part of something as big as this, they may find their customers feel they are not real or not in touch with customer needs. I guess this means that none of the CEOs find it necessary to have a Blackberry or iPhone either....ahhh, not likely the case, right?

Point #2: For a CEO to be on social networking, it gives them a human side. They are not being asked to post every five minutes about their every move. An occasional post about something interesting, something they learned, someone who impressed them (which could remain nameless). A good example of this on Twitter (& maybe not a Fortune 100, but quite internationally successful) is @MichaelHyatt, CEO of Thomas Nelson Publishers. That company is no small potatoes, yet Michael posts about interesting meetings he has had or even having tech trouble. Many times to the average Joe or Jane, CEOs seems so far from them...like God to many people. It would be nice to see that they are human and may have similar interests or travel to similar places, etc.

Point #3: President Obama saw the importance and advantages of today's technology and social media outlets during his campaign. He has a Twitter account, albeit not likely him personally posting. Many important leaders in our world understand the importance of reaching out to the people. Even Queen Elizabeth has opened herself to changing the old adages of keeping behind closed doors, thanks to the public's response to Princess Diana. If they understand it, what does that say about these CEOs?

Just my two cents. :)

Randy Hall
Randy Hall

Gini,

You've got a great perspective on this issue and I think you are, at least in part, addressing the issue of trust. Trust in companies is rapidly disappearing in this economic crisis and one way to begin to restore trust, in a business of any size, is by being accessible. People don't place trust in companies, they place it in people and then do business with people they trust.

Social media is simply another form of communication to be used the right way, or the wrong way. But saying a CEO shouldn't use it is like saying that they shouldn't use email or the telephone. The people and the conversation matter, the technology just enables it.

Great post,

Randy

Daniel Hindin
Daniel Hindin

It seems to me that even as many traditional media outlets embrace social media, most of the traditional media has a complete misconception as to how people use these new tools. Just this morning on CNN, they were talking about the "narcissism" of people on Twitter telling the world, "I'm walking down the street eating a sandwich." Yes, they actually used that as an example.

I've witnessed this attitude toward Twitter and other social media venues as it trickles down to my friends and family members. What a narrow view of this invaluable tool. I tell these friends and family members: "In social media, you get what you give." If you talk about eating a sandwich, that's your prerogative -- but that's not what those who are getting the most out of it are talking about.

Gini and Tony at Zappos are just a couple of examples of those who have quickly understood and embraced the benefits of social media, and, of course, there are many more. Eventually, traditional media outlets like Newsweek will have to come around -- or be left behind. The times are truly changing.

Woo...sorry for the long comment. I guess I feel pretty strongly about this one. :-)

Travis
Travis

This post and the article raises a plethora of issues. As someone who tweets for a brand (@1800GOTJUNK), I have had to teach myself how to use social media as a tool that raises brand awareness but also humanizes the company. As I am sure everyone knows, it has been a tough learning curve. While I am all for transparency and empowering individuals who want to hear from the companies they are loyal to, I don't believe that every CEO should use social media the way that some do. Like any new trend there is that fear factor. But more than that, a value judgement has to be made. Is it worth it for the CEO of company X to engage in conversations like we all have been doing for the last few months? That is a call each has to make. I believe that the real question isn't "should" CEOs have a presence on Twitter or Facebook, but "can" they? I don't believe that there will be a time when every company and every person will have a Twitter account and I am alright with that. There are still some people who don't have cell phones too.

Gini Dietrich
Gini Dietrich

Jon, you raise a great question. It's difficult to measure the value of your time spent online. But if you do it, you know by gut and intuition that it works. And then someone like you come along that says you're back because of the relationship I'm fostering with you, as a person. I personally only can afford to spend an hour a day on the social networks (though I would love to spend more), but I have it down to a science...a science I tweak and prod weekly.

Alexandra, see you in the Fortune 100 soon!

Julio, LOL!

Julio R Varela
Julio R Varela

And I can't type or make sense sometimes. It is "must change" and not "must be change" and other details, blah, blah, blah...

Julio R Varela
Julio R Varela

Gini, this is so on target. I truly believe we are at the next great Age of Business, and that the bigger companies who have made their mark for decades quite successful must be change or else become irrelevant. When I say that to my corporate friends, they look at me with eyes of bewilderment. Nonetheless, the Transparency Trend is going full force and we have only hit the tip of the iceberg. Why do I think that? Because in the end, each individual on the planet who is wired on the Internet will become a personal brand. It might not happen in the next 20 years, but that is where we will be at. The age of receiving messages from big companies is over. And that is freaking companies out because the corporate culture has always been safe, middle of the road, and conservative from a business sense (and rightly so). Better to embrace it now, do it right, and in the end, those companies will keep their customers. Great post.

Alexandra Gibson
Alexandra Gibson

Well said, Gini. I am also the CEO of my company (also not Fortune 100...yet) and believe that my engagement with our community via social media is of paramount importance. It also sets an example for our entire team that conversation is important and that no one in the company is too good or too insulated to engage. More Fortune 100 CEOs SHOULD use social media and networks; consumers want to feel like there are real people behind the walls. The best way to show personality and the human-factor is through this media. Think of how much more you would think of a big brand if you actually received a Twitter reply from the company's CEO.

Martin Waxman
Martin Waxman

I completely agree with you, Gini.

And I wonder if some companies/CEOs are afraid to venture into social networks because of all the unknowns. However, the 'fear factor' is not a good excuse to ignore a major communications trend. Neither is comfort. Nor is a loss of control. These are some of the reasons highlighted in the Newsweek article.

Social networks may have far fewer filters (some would say none) than more traditional modes of communication, but they provide a real opportunity for a CEO (or individual) to establish a presence, showcase a point of view and develop transparent relationships with their various audiences. It's also an effective way to humanize and build credibility for an organization.

Sure, this takes time and we need to make tough choices about which networks we're going to be active in. But like you, I believe the business benefits far outweigh the risks.

Jon Wortmann
Jon Wortmann

So the question is how much time should a CEO spend? I've thoroughly enjoyed the two pieces of yours that I've read and loved that you wrote me back when I commented on the blog. That's why I'm back. Great human capital raising. How do you measure the value of your time online?

Nancy Lyons
Nancy Lyons

Newsweek published the first issue in 1933. This is what happens when dinosaurs comment on social. If CEO's, and legislators, executives, brands, consumers, and journalists, and who knows who else, make themselves the media, and comment on, create and break news first, how can an 80 year old print magazine remain relevant? Insecurity is hard to watch.

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