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Why business is hostile to social networking

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This’s post is from Liz Ruskin, contributing editor of SmartBrief on Leadership.

Corporate leaders fear what people might say if given a voice on social media, but once a business builds a community — among its customers, employees and other constituents — it opens itself to more innovation, gets more from its human capital, turns customers into loved ones and wins the adoration of investors.

Or so claims Mzinga CEO Barry Libert. Of course he would say that: Mzinga creates social networks for businesses, including ABC, Amway, Johnson & Johnson and Deutsche Post. Commercial interest aside, he made an unusual and compelling argument that goes to the heart of what social media could mean in a business environment.

All businesses — whether they make cars, serve coffee or supply paper — must meet the basic need humans have for connection with one another, he claims. “GM never thought of themselves of being in the business of connecting people, which is why they’re going bankrupt,” he told participants at the Milken Institute Global Conference in Los Angeles on Wednesday. (Long before the advent of the Internet, GM should have been listening to customers, rewarding them for loyalty and inviting them to share the joy with their friends and family, he says.)

Fear makes big business reluctant to deploy social media — an obvious problem for his business model, which depends on companies paying Mzinga to establish and manage their social media networks.

Ultimately, he says, companies are run by people, and no CEO wants to appear vulnerable, either in public or in the internal community of the business. “The frailty of humanity is, I’m frightened to hear about me, and as long it’s my business I don’t have to,” he said. The problem is more acute among male executives because they don’t like to share, he says. “As long as guys run businesses, sharing and collaboration and social interactions is going to be tough for most businesses, so we’ll see.”

Once business adopts social media full-on, the very nature of leadership and human engagement will change, he maintains. Learn more  in this video.

Photo credit, iStock