Social Media Information Systems Chapter 8 Social Media Information Systems

“It’s All About Eyeballs” New owner wants to change way PRIDE is used and make it more profitable. Number of eyeballs to look at ads and clicks to generate revenue. Will PRIDE actually work? Need to describe it to potential vendors. Carefully think about details of how system will function before estimating development costs or project timeline. GOALS Illustrate how social applications can generate revenue. Show how cloud-based infrastructure can support social applications. Consider a unique application of social networking for fitness. Show the difficulties inherent in the systems development process. Copyright © 2016 Pearson Education, Inc.

PRIDE Application Prototype Generating revenue from social applications difficult, but possible. Not all social media applications involve Facebook or Twitter. It's all about marketing. Think about ways of applying new, emerging technology to accomplish business organizational strategies. A report with data from a cloud database. Because it is being served from the cloud, it is accessible by doctors, patients, health clubs, employers, insurance companies, and others who are not yet known to be involved Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Study Questions Q1: What is a social media information system (SMIS)? Q2: How do SMIS advance organizational strategy? Q3: How do SMIS increase social capital? Q4: What roles do SMIS play in the hyper-social organization? Q5: How do (some) companies earn revenue from social media? Q6: How can organizations manage the risks of social media? Q7: 2025? Best response to rapid technological change is to learn and understand underlying principles. Focus on principles, conceptual frameworks, and models that will be useful to address the opportunities and risks of social media systems in early years of your professional career. Copyright © 2016 Pearson Education, Inc.

Q1: What Is A Social Media Information System (SMIS)? Social media (SM) Use of IT to support content sharing among networks of users Enables communities, tribes, or hives People related by a common interest Social media information system (SMIS) Supports sharing of content among networks of users Copyright © 2016 Pearson Education, Inc.

Social Media Is a Convergence of Disciplines Focus on MIS portion of diagram by discussing SMIS and how they contribute to organizational strategy. Copyright © 2016 Pearson Education, Inc.

Number of Social Media Active Users 77% of Fortune 500 companies maintain active Twitter accounts; 70% Facebook pages, 69% YouTube accounts Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Three SMIS Roles Social Media Providers Facebook, Google+, LinkedIn, Twitter, Instagram, and Pinterest provide platforms Attracting and targeting certain demographic groups Users Both individuals and organizations Communities Mutual interests and transcend familial, geographic, and organizational boundaries Over 73% of people with Internet access use SM, and 40% access SM via mobile phones. 68% of Pinterest users are female. 80% LinkedIn users are 35 or older. Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. SM User Communities Community A - first-tier community of users with direct relationship to the site. User 1 belongs to three communities — A, B, and C. Communities B–E - second-tier communities intermediated by a first-tier user. Number of second and higher tier community members grows exponentially. Exponential nature of relationships offers sponsoring organizations both a blessing and a curse. If social media site wants pure publicity, will need viral hook to relate to as many communities as possible. Copyright © 2016 Pearson Education, Inc.

Social Media Application Providers Facebook, Twitter, LinkedIn, Google Sponsors might pay a fee, depending on application and what they do with it Creating a company page free on Facebook, but ... Charges fee to advertise to communities that “Like” that page Custom developed SM for company using SharePoint for wikis, discussion board, photo sharing Copyright © 2016 Pearson Education, Inc.

Five Components of SMIS SM application providers host SM presence using elastic servers in the cloud. Develop and operate custom, proprietary, social networking application software. Content data - data and responses to data contributed by users and SM sponsors. Connection data - data about relationships. Organizations must have procedures for creating content, managing user responses, removing obsolete or objectionable content, and extracting value from content. Social media creates new job titles, new responsibilities, and need for new types of training. Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. SMIS Is Not Free Costs to develop, implement, and manage social networking procedures Direct labor costs for employees who contribute to and manage social networking sites 92% of companies use social media to recruit (93% from LinkedIn) 73% hired using social media, and one-third have rejected candidates because of something on their social profiles Copyright © 2016 Pearson Education, Inc.

Q2: How Do SMIS Advance Organizational Strategy? Strategy determines value chains, which determine business processes, which determine information systems. How do value chains determine dynamic processes and thus set SMIS requirements? SM process flows cannot be designed or diagrammed, they constantly change. Copyright © 2016 Pearson Education, Inc.

SM in Value Chain Activities This figure summarizes how social media contributes to five primary value chain activities and to human resources support activity. Copyright © 2016 Pearson Education, Inc.

Social Media and the Sales and Marketing Activity Dynamic, SM-based CRM process Social CRM Each customer crafts relationship Wikis, blogs, discussion lists, frequently asked questions, sites for user reviews and commentary, other dynamic content Customers search content, contribute reviews and commentary, ask questions, create user groups, etc. Not centered on customer lifetime value Social CRM flies in the face of the structured and controlled processes of traditional CRM. Copyright © 2016 Pearson Education, Inc.

Social Media and Customer Service Relationships emerge from joint activity, customers have as much control as companies Product users freely help each other solve problems Selling to or through developer networks most successful Microsoft's Most Valuable Professional (MVP) program Peer-to-peer support risks loss of control Amazon's Vine customers provide pre-release and new product reviews to the buyer community. Copyright © 2016 Pearson Education, Inc.

Social Media and Inbound and Outbound Logistics Social media can be used to provide numerous solution ideas and rapid evaluation of them May provide better solutions to complex supply chain problems Facilitates user creates content and feedback among networks needed for problem solving Loss of privacy a significant risk Problem solving in front of your competitors Suppliers and shippers work with many companies. Copyright © 2016 Pearson Education, Inc.

Social Media and Manufacturing and Operations Designing products, developing supplier relationships, and improving operational efficiencies Crowdsourcing Non-employees voluntarily participate in product design or product redesign Widely used in businesses-to-consumer (B2C) relationships to market products to end users YouTube channel and post videos of product reviews and testing, factory walk-throughs Copyright © 2016 Pearson Education, Inc.

Social Media and Human Resources Employee communications using internal personnel sites Ex: MySite and MyProfile in SharePoint Used for finding employee prospects, recruiting candidates, candidate evaluation Place for employees to post their expertise Risks: Forming erroneous conclusions about employees Becoming defender of belief or pushing an unpopular management message Copyright © 2016 Pearson Education, Inc.

Q3: How Do SMIS Increase Social Capital? Investment of resources for future profit Types of business capital Physical capital: produce goods and services (factories, machines, manufacturing equipment) Human capital: human knowledge and skills investments Social capital: social relations with expectation of marketplace returns Copyright © 2016 Pearson Education, Inc.

What Is the Value of Social Capital? Number of relationships, strength of relationships, and resources controlled Adds value in four ways: Information Influence Social credentials Personal reinforcement - professional image or status Relationships in social networks can: Provide information about opportunities, alternatives, problems, and other factors important to business professionals. Provide an opportunity to influence decision makers who are critical to your success. Be a form of social credentials. Reinforce a professional’s image and position in an organization or industry. Copyright © 2016 Pearson Education, Inc.

How Do Social Networks Add Value to Businesses? Progressive organizations: Maintain a presence on Facebook, LinkedIn, Twitter, and other SN sites Encourage customers and interested parties to leave comments Risk - excessively critical feedback Copyright © 2016 Pearson Education, Inc.

Using Social Networking to Increase the Number of Relationships Discuss how could a photographer use SM to communicate a wedding experience using text, pictures, and video instantly to everyone in your social network, Copyright © 2016 Pearson Education, Inc.

Using Social Networks to Increase the Strength of Relationships Strength of a relationship Likelihood other entity (person or organization) will do something that benefits your organization Write positive reviews, post pictures of you using organization’s products or services, tweet about upcoming product releases, and so on Organizations strengthen relationships with you by asking you to do them a favor Copyright © 2016 Pearson Education, Inc.

Using Social Networks to Connect to Those with More Resources Social Capital = Number of Relationships × Relationship Strength × Entity Resources Huge network of relationships with people who have few resources may be of less value than a smaller network of relationships with people who have substantial resources Resources must be relevant Most organizations ignore value of entity assets and try to connect to more people with stronger relationships Copyright © 2016 Pearson Education, Inc.

So What? Facebook for Organizations… and Machines Chatter, by salesforce.com, to connect employees and customers via social media Organizational communities identify and solve problems more quickly and more effectively than before Readily find and recruit needed experts within organization to help solve problems Faster project collaboration Internal-facing communities use social media to make organizations better Copyright © 2016 Pearson Education, Inc.

Ethics Guide: Social Marketing? Or Lying? Purpose of guide: Explore ethical dimension of that danger How is social networking different in business than in private life? Do ethics vary between private and business use of social networking? Habits formed when using social sites may be inappropriate, harmful, or unethical when applied to business site. Goals Distinguish between using social networking for fun and for business. Explore ethical questions about deception on business social networking sites. Formulate ethical principles when creating or using social networks for business. Copyright © 2016 Pearson Education, Inc.

Q4: How Do (Some) Companies Earn Revenue from Social Media? Hyper-social organization Use social media to transform interactions with customers, employees, and partners into mutually satisfying relationships with them and their communities You Are the Product “If you’re not paying, you’re the product.” Renting your eyeballs to an advertiser Copyright © 2016 Pearson Education, Inc.

Revenue Models for Social Media Advertising Pay-per-click Use increases value: The more people use a site, the more value it has, and the more people will visit. Freemium revenue model Offers users a basic service for free, and then charges a premium for upgrades or advanced features Sale of apps and virtual goods, affiliate commissions, donations Copyright © 2016 Pearson Education, Inc.

Does Mobility Reduce Online Ad Revenue? By 2018, number of mobile devices is expected to reach 10 billion Mobile data traffic will increase eleven-fold Average click-through rate of smartphones is 4.12%, but just 2.39% on PCs Conversion rate Frequency someone clicks on ad makes a purchase, “likes” a site, or takes some other action desired by advertiser Copyright © 2016 Pearson Education, Inc.

Does Mobility Reduce Online Ad Revenue? (cont'd) PC ad clicks more effective, on average, than mobile clicks Clickstream data easy to gather Android users far more likely to click and convert on Facebook ads than iPhone users Mobile devices unlikely to kill Web/social media revenue model How best to configure the mobile experience to obtain legitimate clicks and conversions Copyright © 2016 Pearson Education, Inc.

Q5: How Do Organizations Develop an Effective SMIS? Focus on being cost leader or on product differentiation Industry-wide or segment focus Premeditated alignment of SMIS with organization’s strategy Next slide shows process of developing a practical plan to effectively use existing social media platforms Copyright © 2016 Pearson Education, Inc.

Social Media Plan Development Take a few minutes to consider each step in the process. Copyright © 2016 Pearson Education, Inc.

Common SM Strategic Goals Description Example Brand Awareness Extent that users recognize a brand Organization’s brand mentioned in a tweet Conversion Rates Measures the frequency that someone takes a desired action Likes the organization’s Facebook page Web Site Traffic Quantity, frequency, duration, and depth of visits to a Web site Traffic from Google+ post mentioning the organization’s site User Engagement Extent to which users interact with a site, application, or other media User regularly comments on organization’s LinkedIn posts Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Common SM Metrics Goal Metrics Brand Awareness Total Twitter followers, audience growth rate, brand mentions in SM, Klout or Kred score Conversion Rates Click rate on your SM content, assisted social conversions Web Site Traffic Visitor frequency rate, referral traffic from SM User Engagement Number of SM interactions, reshares of SM content Copyright © 2016 Pearson Education, Inc.

Q6: What Is an Enterprise Social Network (ESN)? Software platform uses social media to facilitate cooperative work of people within an organization Improve communication, collaboration, knowledge sharing, problem solving, and decision making Enterprise 2.0 Use of emergent social software platforms within companies, or between companies, partners or customers Copyright © 2016 Pearson Education, Inc.

Enterprise 2.0: McAffee's SLATES Model Enterprise 2.0: Application of social media to facilitate cooperative work of people inside organizations. Can be used to enable people to share knowledge and problem-solving techniques. Copyright © 2016 Pearson Education, Inc.

Changing Communication Communication channels within corporations changed in equally dramatic ways Using ESNs, employees can bypass managers and post ideas directly for CEO to read Quickly identify internal experts to solve unforeseen problems Copyright © 2016 Pearson Education, Inc.

Deploying Successful Enterprise Social Networks Organizations still learning how to use and successfully deploy ESNs Develop a strategic plan for using SM internally via same process as used for external social media use Assess likelihood of employee resistance Copyright © 2016 Pearson Education, Inc.

ESN Implementation Best Practices Read through the items and reflect on what you went through when you first started using SM. Think about how important your friends were in your decision to start using SM. Having an internal champion or defender is very important. Copyright © 2016 Pearson Education, Inc.

Q7: How Can Organizations Address SMIS Security Concerns? Need a social media policy Consider risks from nonemployee user-generated content Look at risks from employee use of social media Copyright © 2016 Pearson Education, Inc.

Managing the Risk of Employee Communication Develop and publicize a social media policy Delineate employees’ rights and responsibilities Intel's Three Pillars of SM Policies Disclose Protect Use Common Sense Organizations and executives no longer plan and control organizational messaging. Such messaging emerges via a dynamic, SM-based process. Ask students what they think about that. Copyright © 2016 Pearson Education, Inc.

Intel’s Rules of Social Media Engagement Copyright © 2016 Pearson Education, Inc.

Managing the Risk of Inappropriate Content User-generated content (UGC) Problems From External Sources   Junk and crackpot contributions Inappropriate content Unfavorable reviews Mutinous movements Copyright © 2016 Pearson Education, Inc.

Responding to Social Networking Problems Leave it Respond to it Delete it “Never wrestle with a pig; you’ll get dirty and the pig will enjoy it.” Copyright © 2016 Pearson Education, Inc.

Internal Risks from Social Media Threats to information security, increased organizational liability, and decreased employee productivity Directly affect ability to secure information resources Seemingly innocuous comments can inadvertently leak information used to secure access to organizational resources Not a good idea to tell everyone it’s your birthday because your date of birth (DOB) can be used to steal your identity Copyright © 2016 Pearson Education, Inc.

Internal Risks from Social Media (cont'd) Employees may inadvertently increase corporate liability when they use social media Sexual harassment liability Leak confidential information Reduced employee productivity 64% of employees visit non-work-related Web sites each day. Tumblr (57%), Facebook (52%), Twitter (17%), Instagram (11%), and SnapChat (4%) Smart managers know SM comes with both benefits and costs. Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Q8: 2025? Chief Digital Officers (CDOs) responsible for developing and managing innovative social media programs Integrated mobile video, augmented by Google/ Facebook’s Whammo++ Star, have many features that enable employees and teams to instantly publish ideas in blogs, wikis, videos, etc. BYOD Need to harness power of employee and partners social behavior to advance company strategy Social media means customers use all the vendor’s touch points they can find to craft their own relationships. Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Q8: 2025? (cont'd) Emergence in context of management means loss of control of employees Employees craft own relationships with their employers Mobility + cloud + social media will create fascinating opportunities for your nonroutine cognitive skills in the next 10 years! Copyright © 2016 Pearson Education, Inc.

Security Guide: Securing Social Recruiting Employees sharing personal information on SN Technology blurs line between work life and home life Work is portable and always on Be careful about what you say Work networks are not social networks Goals Encourage students to think seriously about how their personal social media sites affect their job prospects. Provide criteria upon which students can evaluate their social media behavior. Underline the need for multiple, strong passwords, once again! Copyright © 2016 Pearson Education, Inc.

Security Guide: Securing Social Recruiting (cont'd) Use communities to locate prospects Find potential behavior or attitude problems Exposing protected data illegal to use for hiring decisions Treat every candidate the same Join LinkedIn, use Google + circles Keep your personal social data out of publicly accessible circles Social media is a double-edged sword Copyright © 2016 Pearson Education, Inc.

Guide: Developing Your Personal Brand College recruiters look for evidence a student has “walked the talk.” Social media presence only one component of a professional brand. Traditional sources of personal branding, like personal networks of face-to-face relationships, important. Understand importance and value of personal brand. Goals Raise students’ attention to the need for and value of a personal brand. The guide in Chapter 8 discusses social recruiting and seeks to minimize damage; this guide seeks to maximize benefit. These are two different, and important, perspectives on personal use of SM. Explore the thin and hard-to-walk line between shameless personal advertising and authentic expressions of personal value. Take a topic, say data security in the cloud, auditing cloud data sources, or some other topic of interest to the class and then search the Web for experts in that field during class. Copyright © 2016 Pearson Education, Inc.

Copyright © 2016 Pearson Education, Inc. Active Review Q1: What is a social media information system (SMIS)? Q2: How do SMIS advance organizational strategy? Q3: How do SMIS increase social capital? Q4: What roles do SMIS play in the hyper-social organization? Q5: How do (some) companies earn revenue from social media? Q6: How can organizations manage the risks of social media? Q7: 2025? Copyright © 2016 Pearson Education, Inc.

Case Study 8: Sedona Social Suppose Sedona Chamber of Commerce hired you as manager of community social media Want you to provide advice and assistance to local businesses in development of social media sites and manage Sedona CoC’s social media presence Begin by making suggestions on ways their SM site could be improved GOAL: Use case questions to get student to think of ways to use social media. Copyright © 2016 Pearson Education, Inc.

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