As emptied grocery store shelves along the East Coast proved last week, people like to prepare for impending crises. That is, unless those crises are happening on social media sites, a recent study from Altimeter Group found.
"Companies are quick to deploy the latest social media technology, yet most companies are not prepared for the threat of social media crises, or the long-term impacts to business," the Altimeter report states in its executive summary. About 76 percent of crises could be avoided or diminished, the study found.
Even companies that have implemented advanced social media policies are ill equipped, because of what the report calls "fragmented technology" and a failure to tie concrete customer data to support systems and "the product roadmap."
How does a company get to that point? By following what the report's lead writer, Jeremiah Owyang, calls the "social business hierarchy of needs." Similar to psychologist Abraham Maslow's hierarchy of needs, Owyang's model lays out a pathway from the basics to social media enlightenment.
Defining a crisis
Just what constitutes a crisis anyway? For the purposes of the Altimeter study, they must have impact, Owyang says. "Crises happen every day. So what? Let's focus on the big ones."
To qualify as a social media crisis, Owyang says, an event must have one of these four effects: It causes major media coverage, necessitates changes in company processes, directly causes a decrease in revenue, or results in fines from the government.
According to the report, from 2007 to 2008 the number of such social media crises doubled. Over the past three years or so, the number of occurrences has remained high.
The findings
Altimeter's study is the result of 62 in-person and phone interviews with brands, experts and social business software companies, as well as a survey of 144 companies. Through collecting that data, Altimeter's researchers found that companies with the most-advanced social business structures have four traits in common.
First, they have what the report calls "baseline governance and reinforcement." Essentially, the companies have written policies that protect the company as well as its employees. Those policies don't discourage social media use. Rather, they encourage employees to participate. The companies can also reinforce the policy through continued training.
Another finding is that these advanced companies all have ongoing social media education programs. That is, they don't just have a one-week training program and that's it. Employees who use social media receive ongoing training and have a communications outlet for sharing best practices.
Processes for what to do should be shared companywide, the report states. Companies should have formalized social media crisis response plans ready to go. More than half the companies surveyed didn't have one.
Finally, the study found that companies with advanced social media programs have some kind of social media hub, a "center of excellence" from which the corporate social media team works. That team is led by a social media strategist and operates across divisions, the report states.
Even advanced companies have issues dealing with social media crises because of a "fragmented and unwieldy set of immature technologies" and difficulty tying social feedback to root problems.
"In our interviews, we heard that companies struggle with fragmented data sources, lack of internal funding, and concerns over customer privacy," the report states.
Social monitoring tools alone won't cut it, Owyang says, because "they can only capture what has been said and where it was said." Companies need to know why customers say what they do and what they mean to make worthwhile changes, he points out. That's why they need social analytics software as well.
Reaching enlightenment
To get to the point where they can deal with social media crises, companies should make their way up the social business hierarchy of needs, the report recommends. The hierarchy is structured like this:
At the bottom is the "foundation," which involves defining clear business objectives for using social media—not just gaining Facebook fans, but really making business progress, Owyang says—and establishing what the report calls "guardrails." Those guardrails include policies for privacy, community, ethics and social media use. Then, the company must educate employees regarding those policies.
Next comes the "safety" level, which deals with putting together a team to work in the "center of excellence." Then, it should define ways to determine when something is a crisis and who should handle it; the team should regularly conduct "fire drills" to test those structures.
The third level is "formation," at which your social media program expands from the core team to every division of your company. Use the company's center of excellence for measurement, to make sure efforts aren't duplicated and to ensure the right people have the right tools.
The penultimate stage is "enablement," in which you actively encourage the various divisions of the company to develop their own social media programs.
Finally comes "enlightenment." "Armed with real-time data from employees, customers, prospects and partners, companies now have the potential for real-time decision-making across their entire ecosystems," the report states.
How long does it take to reach enlightenment? That depends on how many resources the company is putting into its social media efforts, Owyang says. "I don't think there is a standard on how quickly they can move," he says.
A few companies—such as Dell, Zappos and eBay—are reaching the upper levels of the hierarchy, Owyang says. For example, Dell is figuring out ways to use the tools at its disposal to connect the social media dots.
"They're tying together Radian6 data with Salesforce and Seesmic as their social media management system on mobile devices," Owyang says. "They're starting to track and integrate all that data."