November 18, 2009

Can a Well-Drafted Social Media Policy Save You Money?

Posted in Best practices, Employee issues, Productivity, Social Media Tools, Social networking policy, Twitter, Web 2.0, Web 3.0 tagged , , , , , , , , , , , , , at 2:28 am by bizlawblog

Netcraft, an Internet services company based in Bath, England, reported that, as part of its July 2009 Web Server Survey, it received responses from 239,611,111 sites, an increase of around 1.5 million sites from the previous month. I’m sorry, did somebody just say Web sites are proliferating at something like 1,500,000 per month?

A glance at Technorati’s annual State of the Blogosphere report reveals equally staggering numbers of blogs, unique visits, and Facebook members. It gets better. Jim Singer’s article on the IP Spotlight blog, Employee Blogging and Use of Social Media – Managing the Risk, notes:

Social media usage is exploding.  Recent data indicates that Facebook has over 200,000,000 users, while Twitter has over 7,000,000 users.  According to Technorati data as reported on Wikipedia, at the end of 2007 more than 112,000,000 blogs existed.

Blogs, Facebook and Twitter accounts, texting, and the use of other social media by employees can create many risks for employers.  Unlike conversations, social media postings leave a data trail — and that data trail can quickly be tracked, copied, and distributed to an unlimited number of readers.  The news headlines are filled with stories of poor judgment by employees on social media sites.  Microsoft fired an employee who published photos of Apple computers being loaded into a Microsoft research facility.  Delta airlines fired a flight attendant who posted photos of herself in a corporate uniform.  Google fired an employee who blogged about, among other things, Google’s compensation.

Singer summarizes employers’ risks from their employees’ social media activity as including:

  • publication of trade secrets;
  • dissemination of confidential information relating other employees, customers, or business partners;
  • copyright and trademark infringement;
  • libel; and
  • loss of control of business reputation

The problem for employers seems to be that they’re damned if they do and damned if they don’t. As marketing mavens turn from paper media, to Web, to blog, to Twitter campaigns and beyond, their corporate clients are feeling the pinch of a currently unfathomable economic slowdown, necessitating a higher ROI from potentially declining marketing budgets. One apparently easy answer may be to enlist and unleash employees with their low cost or no cost viral marketing abilities.

Although an instant army of marketing employees may seem a simple solution, Fred Abramson points out in his article, What you need to know about Defamation and Web 2.0:

Bloggers and anyone else using social media need to be aware of what they post online.  There is a serious threat of what you post can result in litigation.

I recently reported that there has been a 216% increase in libel lawsuits against bloggers.  Courtney Love’s Twitter defamation case is not going away.

Yelp, the popular review site, has been at the center of the debate because people are using the service to write reviews that are untrue.

A $1 million judgment, including an injunction and costs was granted against a defendant who persisted in posting false and defamatory statements in online forums regarding his fraudulent transactions at the expense of an online company.

OK, so maybe a little “sensitivity training” might be in order before unleashing the hordes of marketing hounds, but what if they turn on you? Deloitte LLP’s 2009 Ethics & Workplace survey indicated that:

60 percent of business executives believe they have a right to know how employees portray themselves and their organizations in online social networks. However, employees disagree, as more than half (53 percent) say their social networking pages are not an employer’s concern. This fact is especially true among younger workers, with 63 percent of 18–34 year old respondents stating employers have no business monitoring their online activity.

That said, employees appear to have a clear understanding of the risks involved in using online social networks, as 74 percent of respondents believe they make it easier to damage a company’s reputation.

With the explosive growth of online social networks, such as Facebook and Twitter, rapidly blurring the lines between professional and private lives, these virtual communities have increased the potential of reputational risk for many organizations and their brands…

Could it be that lawyers may have the answer? Kate Early, corporate counsel for LexisNexis posted a nice article on her blog, “Social Networking Helps Cut Company Legal Fee Costs – How? Read on!”, which may give you a clue where I’m going with this. She notes:

Social networking is helping companies…cut legal fees by providing groups and forums for them to discuss and share ideas and answers to legal questions for free.  For instance, on Linked In, there are topic groups that you can subscribe to, like Intellectual Property.  You can then post questions and answer other people’s questions.  Human resources professionals are also benefiting.  Of course, there are issues about the lack of attorney-client privilege and there is no privacy to the questions.  However, for general inquiries that are not private … these sites can really help.

Neetal Parekh’s article, Legal Cost-Cutting and Social Networking: Strange Bedfellow, goes a little deeper:

Breaking down the buzz word “social networking” you get two core concepts of communication.  Social and networking.  Whether you are in a conference break-out session, happy hour, basketball court sideline, or company luncheon you have an opportunity to interact with others in a less-formal, more-personal way.  Similarly, social networking allows a candid flow of thought and exchange of ideas.  Just like your career counselors encouraged you to do in law school in their odes to the power of networking, connecting and sharing online is a form of networking.  And one that seems to be gaining some street cred from its offline cousin.  And though three years of legal training has drilled in considerations of liability, privacy, and confidentiality, it is up to the innovative devices of in-house counsel to find constructive and ethical uses of social networking that will inspire progress and productivity within their legal departments.

Woody Allen is quoted as saying: “Eighty percent of success is showing up.” Many of the financial advisors I’ve talked to in recent months, as well as wealthy clients, seem to be saying the same thing about survival in our depressed economy. Their goal, rather than making money, often focuses on not losing as much as anyone else. In the final analysis, they speculate (no pun intended), if they are able to keep from losing more of what they have than the competition loses, they’ll still be ahead of the game when things turn around, as they always do.

The depth of “expertise” of most social media consultants must be subject to scrutiny. After all, the field itself is still emerging and changing by the second. We’re all just starting to explore this murky new territory. The maps we draw for our clients to follow may sometimes be no more useful than a sandcastle built too close to the ocean surf.

Given the shifting sands on which we stand, our greatest success may come from simply failing to make as many mistakes as our competitors, and, as Woody Allen suggests, staying around for the next act.

We may not have a firm grip yet on what really works in the universe of social media. We are quickly learning, however, what doesn’t work, and how large the judgments, legal fees, and lost profits can be when we make easily avoidable mistakes. It is the avoidance of those mistakes that a well-formulated, organic social media policy can easily prevent. A good policy can encourage the cost saving benefits corporate lawyers have already found.

This is far from a perfect solution or tool, but the process of creating a social media policy for your company, getting employees and managers to buy into the process and become stakeholders in the positive results it can bring, can go a long way to making your company one of the survivors. That may be enough to make you the victor in your arena. I’ll explore this process in a future series of posts on this blog.

That’s what I think. Please leave a comment and let us know what you think.

If you are really interested, I just started yet another free group on LinkedIn, Social Media Search and Forensics. Many of these articles and discussion about them are posted there. Please join us.

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2 Comments »

  1. Nils Montan said,

    Excellent overview. I would love it if you could repost it on the site of the LINKEDIN Group, Law and Social Networking. It’s a good audience for this.

    • bizlawblog said,

      Nils,

      I was booked with 52 LinkedIn groups, but after looking at the Law and Social Networking group, dropped one which appeared unproductive.


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