The Social Media Revolution
We are moving forward in an age where information is shared more freely than ever before, largely, in no small part, to the rise of social media. These days, social media is about much more than connecting with old acquaintances, and the need to harness its power for business purposes is growing.
In February 2013, McKinsey & Co published a compelling article on social media skills and leadership. To welcome in the New Year, we revisited the principles that formed the sixth most-read article by mckinsey.com readers for 2013.
Social media adds new dimensions to traditional leadership traits and according to McKinsey these traits form the six dimensions of social-media-literate leadership, as evidenced by the following diagram.
A practical example is through the implementation of General Electric’s digital platform, GE Colab, which incorporates Facebook, Twitter and other social networking tools to allow for greater information sharing, as well as instant and open lines of communication.
The first dimension says that leaders need to be able to create compelling content. Mark Begor, who runs GE Capital’s real estate business, produces weekly five-minute videos for his division as part of GE’s Video Central initiative. “I talk about what I learned during the week, a great deal we’ve closed or mention employees I want to recognise,” says Mark, adding that these unscripted clips break down barriers of traditional media. This allows for greater participation and ultimately, engagement with both employees and current and potential customers.
In addition to content creation, leaders must distribute, receive and make sense of all the noise (by learning to hit the “delete” or “share” buttons as soon as information lands in their inbox). They must also develop infrastructure that fosters the strategic use of social technologies, as well as stay abreast of technological development. In GE’s case, this is delivered through the process of “reverse mentoring”, whereby senior executives are partnered up with social media-savvy millennials.
The benefit to leaders who master the six dimensions to social media literacy? They’ll be able to attract and retain talent, and tap deeper into the capabilities and ideas of their employees and stakeholders. They’ll benefit from tighter and more loyal customer relationships. And they’ll be more likely to create new business models that capitalise on the potential of evolving communications technologies.
Chief Executive Officer of Montgomery Investment Management, David Buckland has over 30 years of industry experience. David is a deeply knowledgeable and highly experienced financial services executive. Prior to joining Montgomery in 2012, David was CEO and Executive Director of Hunter Hall for 11 years, as well as a Director at JP Morgan in Sydney and London for eight years.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
Kelvin Ng
:
Hi David, the rogermontgomery.com website itself is a brilliant example of the savvy use of social media……
Happy New Year!
Kelvin
Andrew Legget
:
Great article David, a good start to the new year and something really relevant to myself.
Social media when used properly is a powerful tool in marketing whether it be for an individual or business. From an investing perspective, any type of company that is in some form of consumer discretionary category (and even those that aren’t) and are not using social media well should have some questions asked about management in my opinion.
My (very breif so far) foray into enlarging my personal/professional online footprint has seen a tweet made about Myers online sale meltdown and an accompanying link from the Australian linked to a random small online retail newspaper with 253 followers. Without going off topic, whilst i accept that problems happen it was the CEO’s comment about online only being 1% of sales which led me to myconclusion of them not having a clue about the power of online retail. It might be 1% now but it will be much greater tomorrow and would leave a sour taste in their customers mouths who have probably been looking forward to the sale for a while..
It is an opportunity to for the customer to link themselves with the brand and have that brand engrained into their lives and a great customer service tool where a company can be proactive in managing problems and generating more economic goodwill.
One final thing though i will point out is that it is a bit like the use of debt. It will leverage both good things and bad things, it will allow a company to shout about their victories instantly but it will also allow your failures to be quickly sent out and disseminated to millions in the same instant time frame.
A very important, growing area for businesses to pay close attention too.
I am actually currently in my free time starting the process in valuing twitter through their IPO document as a personal challenge (whats easier than valuing a company using limited financial history, that has very little history in general, is currently running losses but growing at a decent clip and operates in a fast changing industry?) and in the process got a much better understanding and confirmed so previous opinions on how the business works. Their competitive advantages i feel can be described as weak at best.