Social Media: Changing the rules of business ethics: It’s a brave new world out on the web, says NIU’s David J. Gunkel

Social Media: Changing the rules of business ethics

It’s a brave new world out on the web, says NIU’s David J. Gunkel

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The web as we know it is neither a static nor stable medium. It is evolving. And as it evolves, so too do the moral opportunities and challenges. The first generation web, the web of the dot com era or what is now called web 1.0, represented a major change in the technology of corporate communication but not in the underlying rules of the game. The most recent version of the web, however, represents the opposites. Web 2.0 (a term initially coined by Tim O’Reilly) is not a new technology but a change in the way existing technologies are used. And these new implementations, especially in the area of social media, present some unique challenges to business ethics.

1) Community (and not content) is king

For the first generation web, the name of the game was content. In fact the mantra of the dot com era Internet was “content is king.” During this period of time, the goal of a web-savvy businesses was to develop unique material that would capture eyeballs and connect consumers to its brand, whether a product, a service, or both. And the main ethical concern during this period of time involved the typical things PR departments worry about—truthful communication, public relations spin, and brand integrity.  all_friends-512

In the web 2.0 world of social media, it iscommunity and not content that is king. Here the main objective is not effective message transmission, as you would have, for example, in an email blast, but the formation and maintenance of communities of common interest, as we see with an application like Facebook. This shift in perspective not only alters the terrain of corporate communications but imposes a new set of responsibilities on organizations.

In fact, one of the principal ethical challenges occurs when organizations try to manage and control the social situation. In 2006, two retirees, Jim and Laura, made an RV road-trip across America, parking at Wal-Mart Store on the way and blogging about their positive experiences with Wal-Mart and its employees. Their blog, called Wal-Marting Across America, came under intense scrutiny, when BusinessWeek reported that the trip was indirectly funded and supported by Wal-mart through the activities of its PR agency, Edelman. In response to this kind of behind-the-scenes manipulation, the Federal Trade Commission has modified its guidelines on endorsements and testimonials in order to accommodate the opportunities and challenges of social media. Like everyone else, corporations need to learn how to make friends; they cannot fake it.

2) Power to the prosumer

Although social media is all about relationships, web 2.0 also complicates the roles of the participants within these relationships. During the web 1.0 era, things were clearly identifiable and fixed. There were producers, and there were consumers. The name of the game for a producer was to capture eyeballs and transform viewers of content into paying customers. The flow of information was top-down, from a few producers to a large number of potential consumers, and consumer behavior was largely limited to making a purchase or not. Despite the new technology of the Internet, the terms of the relationship and the arrangements of power in that relationship had not changed.

instagram-app-iconSocial media introduces a new player—the prosumer. In the web 2.0 era, content is no longer generated by a few producers who distribute their information to a mass audience of consumers. Now content is generated from the bottom-up by prosumers who are as much consumers of web data and services as they are producers of it. Prosumers write reviews, post comments, and share content within their network of friends and followers. This activity challenges existing power structures by leveling the playing field or even overturning standard assumptions. Because the bar for participation in social media is set so low, a teenager not only can have more followers on Twitter and friends on Facebook than an established corporate brand, but her opinions can often have greater impact and influence than a carefully crafted advertising campaign.

This shift in power, introduces some new challenges and responsibilities. In February 2010, Nestlé found itself unable to control a barrage of negative publicity or what The Guardian called an anti-social media surge. Like many corporations, Nestlé maintains a Facebook page, where “fans” can post comments about the corporation and its products. The page was designed to leverage the power of prosumers by encouraging bottom-up participation in the brand. But things can also go the other direction, and this is precisely what happened with Nestlé. In response to a Greenpeace campaign concerning the use of palm oil, many “fans” of Nestlé started posting negative comments on the corporation’s Facebook page. And attempts to control this outbreak only made matters worse, when the administrator of the account for Nestlé tried to respond in kind.

3) Blurred lines

Because social media effectively level the playing field between individuals and organizations, these applications often blur the line separating what is public from what is personal. As a Deloitte Survey from 2009 characterizes it, “while the decision to post videos, pictures, thoughts, experiences, and observations to social networking sites is personal, a single act can create far-reaching ethical consequences for individuals as well as organizations.”

The principal ethical challenge for an organization is to decide whether and how to deal with this content, especially when it is critical of the downloadenterprise or exposes personal information about employees or candidates for employment. Can or should an organization, for instance, discipline employees who post comments that are critical of their employer or potentially embarrassing to the company? In 2011, Argos, a major retailer in the United Kingdom, fired an employee for complaining about his job on Facebook. Although the name of the employer did not appear anywhere in the post, Argos argued that the employee’s comments were a breach of the terms of employment and could damage the reputation of the company. The difficult task for organizations involved in this kind of activity is to figure out acceptable levels of monitoring their employee’s personal use of social media while simultaneously respecting their right to free expression.

Similar challenges occur in the area of recruitment and retention. Although not officially part of an application, many recruiters now use social media to screen candidates. InJobvite’s 2011 survey of human resource professionals, 64% reported using two or more social networking sites to evaluate applicants. And in a 2013 survey conducted by On Device, one-in-10 young people (age 16-34) report being denied employment because of something they posted to their social media profile. The ethical challenge to organizations in this case is a matter of balancing the opportunities for increased forms of data collection (what some might call “surveillance”) that have been made available by social media with an individual’s right to privacy.

imagesAt this particular time, answers to many of these questions are still being debated and prototyped. For now, organizations should develop, publish, and consistently apply explicit policy regarding the organization’s use of social media. And individuals, especially young people completing their university education, need to begin thinking critically about what they do online and why. For both individuals and organizations, therefore, effective and intelligent use of social media requires thoughtful planning and careful execution.

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