Wednesday, December 09, 2009

Social Media Risk Management

Social Media Risk Management (3 of 3)

In my previous two posts I have identified a number of risks concerning business participation in social media as well as the factors that exaggerate these risks.

As financial return on investment seems to be difficult to ascertain with any accuracy it is difficult to determine whether a risk is worth taking. Therefore, it is important to mitigate risks as much as possible.

As with all business risks they can normally be:

1. Managed - terms and conditions, including disclaimers, can assist in managing risk. In a recent case a disclaimer on a website excluded liability when a visitor to the site tried to rely on content published on that site to sue its operators. Arguably the same will apply to a disclaimer on a Twitterback for example. Following Social Media etiquette is also key to managing risk.

2. Insured - it may be possible to insure risks associated with Social Media. I am not qualified to advise on insurance coverage so would recommend speaking to your broker.

3. Considered and Risk Taken - it may be that if the risks have been discussed and a strategic decision taken to accept them. Given the rapidly changing social media landscape such a decision would need to be under constant review.

4. Ignored - many choose to take the head in the sand approach with risk on the Internet until there is a problem. This will change when some of the legal risks are tested in court.

5. Avoided - Risk training for those who are participating in Social Media on behalf of the business will mean that they should appreciate the risks and more easily spot content that could incur liability. Having an acceptable content and participation policy would also assist participators with avoiding risk.

Every business will be different and should consider the normal risk v reward conundrum. Training and awareness is one way of making this decision easier as well as an appreciation of the technology and its potential.

As the social media landscape changes rapidly (seemingly on a week by week basis) this question will need to be kept under constant review.

My view is that risk can be reduced by a mixture of empowering the right people, disclaiming liability, training them on the risks and setting guidelines (perhaps with example posts of what is and isn't acceptable from the business' point of view) for acceptable participation.

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