June 2014 (13:2) | MIS Quarterly Executive 97
Social Media Chaos1
For many business managers and executives, social media is chaotic territory. The two text
panels below show the perils of ignoring social media or inappropriately engaging with them.
To avoid these perils, organizations need a systematic approach for extracting value from the
mayhem of social media. Starting with the notion of the organization as a capital-conversion
system, we provide a structured approach to implementing a social media strategy that can
create capital out of chaos. We demonstrate how to convert internal and external social media
activities into social, symbolic, human, organizational and economic capital.
1 This article is being published as a SIM-sponsored report.
Generating Capital from Social Media
Social media represent a chaotic and diverse set of offerings that few organizations
can afford to ignore. Starting with the notion of the organization as a capital-conversion
system, we provide a structured approach for developing a social media strategy
that can make capital out of the chaos. The approach links organizational strategy
to capital-generation goals that shape social media strategy, which includes a mix of
four tactics: Listening and Branding, Mining and Deciding, Conversing and Sharing,
and Co-creating and Innovating.1
Munir Mandviwalla
Temple University (U. S.)
Richard Watson
University of Georgia (U. S.)
Perils of Ignoring Social Media: “United Breaks Guitars”
Over 12 million people have viewed “United Breaks Guitars” by David Carroll and his band.
The New York Times. He later
Guitars.”
Tahoe ads
to tell.
98 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
Five Types of Capital2
Humans are creators and transformers of
capital, which is a durable and transforming
factor of production generated by a prior
investment. For tens of thousands of years,
we have been fashioning culture and building
environments through creating and transforming
A company typically starts with a mix of
human capital (entrepreneurs), social capital
(their connections) and economic capital (e.g.,
venture capitalists or angel investors). For
example, when Jobs, Wozniak and Wayne started
circuit boards and build rudimentary computers
(human capital). All three had valuable links in
the electronics industry (social capital), and the
initial economic capital came from a venture
capitalist, who also provided organizational
capital because of his business experience.3
Subsequently, Apple used its initial capital to
market products (economic capital) and fashion
a brand (symbolic capital). Today, Apple is a
massive generator of economic capital, the
We view the organization as a capitalIt
takes in capital, converts it from one form to
another or enhances it (e.g., educating recruits),
with the ultimate goal of generating capital
(economic capital) to hire certain key skills
2 Dean, A. and Kretschmer, M. “Can ideas be capital? Factors of
production in the postindustrial economy: A review and critique,” The
Academy of Management Review, (32:2), 2007, pp. 573-594.
3 Linzmayer, O.
No Starch Press, 2004.
(human capital) to conduct R&D to generate
intellectual property (organizational capital).
a knowledgeable employee leaves). Economic
growth occurs when the myriad of capitalhospitals)
in an economy collectively generate
more output than input. Indeed, competition
ensures that capital stocks increase as those that
do not master capital conversion fail.
Social media, if handled correctly and because
of their growing pervasiveness, are a means of
creation as a lens, we show how organizations
can convert the jumble of social media options
into capital.
Table 1: Capital Typology2
Economic
Social
Human
Figure 1: The Organization as a CapitalConversion
and -Creation System
Organization
Inflows
Outflows
Losses
Human
OrganizationalEconomic
Social
June 2014 (13:2) | MIS Quarterly Executive 99
Generating Capital from Social Media
Social Media as a Capital-Creation
Opportunity
Social media can operate in two broad
spaces, within and without the organization. The
external space includes the public, customers
and prospective customers, legislators and
regulators, competitors, suppliers, distributors
(see Figure 2). The organization’s social media
channels can be leveraged to generate and
improve all of its different types of capital.
Internally, an organization seeks to generate
competencies (human capital) and connections
(social capital) among its employees. It creates
operations and generate innovations. Externally,
enterprises endeavor to attract relevant capital
to build linkages, legitimacy and relationships
with key stakeholders (social capital). The
use of social media is an important element
of brand- and reputation-building (symbolic
capital); the examples of United Airlines and
GM show how social media can reduce symbolic
capital. Learning how customers react to
products and services, particularly failures,
facilitates the development of human capital
(e.g., understanding which features work well)
and organizational capital (e.g., building better
incident was ignored for months, resulting in a
loss of symbolic capital that still persists because
of the song’s popularity. United failed to create a
response protocol for such events (organizational
capital) that would limit the loss of symbolic
capital. Finally, a positive social media review can
stimulate sales (economic capital).
systematic way to manage social media. We
provide a framework to guide the generation of
organizational value through capital development
enabled by social media. The framework is
presented in conjunction with case studies that
illustrate good practice and challenges to avoid.
(The Appendix describes how the cases were
sourced and the framework was developed.)
A Strategic Framework
for Generating Capital
from Social Media
as the technological
enablement and enhancement of human
interaction in society and organizations. Thus,
organizations and society. They are part of the
input, throughput and output that underlie
and represent the generation of capital in
organizations. Our strategic framework
comprises four complementary tactics for
generating capital from social media:
Listening and Branding—learning and
engaging that drives human, social and
symbolic capital generation
Figure 2: Four Types of Social Flows
1. Organization-to-Environment
2. Environment-to-Organization
100 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
Mining and Deciding—data-driven analysis
and decision making that creates human
and organizational capital
Conversing and Sharing—knowledge
generation and dissemination that develop
human and social capital
Co-creating and Innovating—creating new
products or solving problems to generate
organizational capital.
Organizational strategy shapes capitalcreation
goals, which in turn drive social media
strategy (see Figure 3). The four social media
capital-creation targets. The appropriate mix of
goals is an organization’s social media strategy.
This strategy is assessed in the context of capital
hits.
Many organizations have dipped their toes
into the social media vortex but have often
retrospectively analyzed social media endeavors
by focusing on capital creation. This emphasis
informs organizational strategy by providing a
media strategy in terms of capital creation. The
capital-centric approach allows organizations to
stay focused on (a) generating value rather than
operating technology and (b) provides tools to
strategy.
Social Media Tactic 1:
Listening and Branding
The Listening and Branding tactic is about
using social media to learn about and engage with
current and prospective customers, suppliers
and employees. It is the activity that generates
product reviews on Amazon. When it works well,
this tactic can facilitate an organization staying
in touch with its extended community (social
capital), reinforce its value proposition (symbolic
capital) and enable it to immediately sense and
respond to opportunities and threats by learning
how stakeholders react to initiatives (human
and organizational capital). However, because
the entry cost is low, Listening and Branding
projects typically represent an easily overlooked
line item in corporate budgets, and it is easy to
disregard the strategic impact. Such projects can
easily morph into embarrassing disasters that
damage an organization’s capital. There are three
key actions that govern how well an organization
implements the Listening and Branding tactic:
Co-mingling of marketing and corporate
communications so that reacting to
consumers’ comments becomes an
opportunity to create symbolic capital
through effective linkages with opinion
leaders.
Rethinking the corporate brand as a social
construct where control is shared with
stakeholders.4
The brand—i.e., symbolic
capital—is now co-generated by the
organization and its stakeholders.
Leveraging electronic word-of-mouth by
complementing the conversations between
consumers to enhance the brand and also
to learn about what creates customer
value.
The Listening and Branding tactic also
generates risks. For example, consumers often
see social media only as a coupon-generation tool,
resulting in a reduction of revenue (economic
capital). Encouraging complaints and surfacing
problems without an appropriate reaction system
4 Pitt, L. F., Watson, R. T., Berthon, P., Wynn, D. et al. “The
penguin’s window: corporate brands from an open-source
perspective,” (34:2),
2006, pp. 115-127.
Figure 3: Determinants of Social Media Strategy
Organizational -
Goals
Social Media
June 2014 (13:2) | MIS Quarterly Executive 101
Generating Capital from Social Media
(organizational capital) can reduce symbolic
capital.
Organizations can mitigate the risks by:
Ensuring that projects have working
partnerships among marketing,
communications and legal so that when
the organization inserts itself in the
social media stream it can respond in an
integrated manner
Establishing monitoring tools and
where appropriate, respond
Implementing metrics to analyze and
measure social interactions and the
effectiveness of various responses to
provide the foundation for long-term
strategic direction and assessment of
capital goal-realization.
At the minimum, most organizations should
community and learn from it. The challenge
facing organizations is whether they should
media.
Implementing the Listening and
Branding Tactic
To implement the Listening and Branding
tactic in context (see Figure 4) and align
implementation to capital-generation goals.
In organizations where social media are part
of substantial positive capital generation, they
should be part of the overall organizational
strategy. Conversely, when the likely impact
of social media is of little import, operational
severe negative consequences of the Listening
and Branding tactic, there needs to be an
organizational defense team to mitigate such
consequences. A marketing-centric approach
is called for when there are moderate capitalcreation
prospects.
Implementing the Listening and Branding
social media tactic creates an elasticity challenge
because it means relinquishing control and
strategic direction. It creates tension between
major stakeholders (customers, suppliers and
competitors) and the enterprise as they jointly
stretch a brand in four distinct but related
directions: Control, Information, Criticism and
Socialness (see Figure 5).5
Organizations aiming to build symbolic capital
will have to carefully manage the level of Control;
moves the brand in an undesirable direction.
There are three strategies an organization can use
up approach and allow and accept emergent
consumer control (e.g., the Facebook page is
owned by a fan); 2) follow an emergent bottom-
5 Adapted from Fournier, S. and Avery, J. “The uninvited brand,”
(54:3), 2011, pp. 193-207.
Figure 4: Context of the Listening and
Branding Tactic
Figure 5: Dimensions of the Listening and
Branding Tactic
Socialness
Community
Individual
Information
Closed
Bottom up
Intervention
Top down
Invite
Respond
Fight
Take it on the Chin
Ignore
Social
Human
102 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
a valuable conversation; or 3) follow a top-down
elements determined in advance (e.g., Snuggie,
a U. S. provider of novelty blankets, encouraged
consumers to create parodies of its products).
An enterprise can position itself anywhere
along an Information continuum ranging from
secretive to transparent. This positioning will
have an impact on its symbolic and social capitalcreation
opportunities. The three strategies an
organization can adopt are:
1. Proactively determine in advance what
information they want to disclose (e.g.,
a CEO blog in which problems with a
product are discussed openly)
2. Follow a reactive model and have a
process in place to respond to and
provide information based on events or
requests (e.g., what information to release
if a product’s safety is questioned in a
discussion forum)
3. Decide to remain closed. Consumers
will often ascribe positive attributes to
organizations that are open and authentic
in social media forums, and this can build
symbolic capital by establishing positive
With the Criticism dimension of the Listening
strategies organizations can adopt:
1. Invite criticism (e.g., Domino’s Pizza
feedback process )
2. Have a process and resources in place
to respond to criticism (e.g., Comcast’s
customer service agents respond to
negative tweets8
)
3. Fight back when the criticism is
damaging, and mobilize action by positive
stakeholders
6 Note: The term “information” here refers to the policy on
providing formal information, such as documents, facts and so on.
Information at its most basic level is embedded in all dimensions of
the Listening and Branding tactic, including Control, Socialness and
Criticism.
7 Domino’s has made customer feedback and transparency a key
element of its strategy, including listing the names of employees
who are making individual pizzas on its online tracker, openly
listing customer complaints and, more recently, launching a major
advertising campaign acknowledging the complaints and how it is
responding.
8 In 2009, Comcast won praise for its Director of Digital Care,
whose job is to interact with customers on Twitter.
4.
and openly discussing remediation
5. Ignore criticism in the hope that it will
fade. Ignoring criticism is a viable strategy
given that social media is fast-paced and
conversations and issues often have a
Criticism builds both symbolic and human
capital because the opportunity to respond to
customers can create brand value as well as
facilitate deep learning about customers’ needs
and preferences.
The Socialness dimension of the Listening
and Branding tactic concerns the basic human
The primary strategy is to build a
community, but forming and sustaining a
casual interaction is likely more feasible for most
organizations, or the organization can choose
to interact with each individual on a one-to-one
basis.
The following sidebar describes how
Campbell’s Kitchen implemented the Listening
and Branding social media tactic.
Listening and Branding Tactic Key
Insights
Campbell’s Kitchen follows a relatively
lightweight approach and has outsourced the
on the company is light. Other organizations
follow a heavier approach to social media content
management. Campbell’s Kitchen, however, has
taken a cautious and deliberate approach to
of its approach of carefully thinking through each
process in advance is that it:
Moderates the need for human and
organizational capital investments
Reduces the perceived project risk
Reduces the cost
Likely increases top-management support.
When the Listening and Branding tactic is
actively managed, it can lead to human capital
development, as employees have an opportunity
9 Fournier, S. and Avery, J., op. cit., 2011, p. 195.
10 Based on interviews with managers and analysis of public
website.
June 2014 (13:2) | MIS Quarterly Executive 103
Generating Capital from Social Media
to learn directly by listening to key stakeholders.
This interaction can add social capital through
the creation of relationships and connections. The
Listening and Branding tactic can create symbolic
capital as the organization leverages the social
Social Media Tactic 2:
Mining and Deciding
The Mining and Deciding social media tactic
is concerned with making sense of the chaos
and turning it into advantageous human and
organizational capital. This tactic involves
analyzing text (e.g., comments on a discussion
forum), usage records (e.g., who is accessing
what on a website) and demographics (e.g.,
identifying long-term trends). Above all, it is
about unearthing the relationships and trends
among and between current and prospective
customers, suppliers, employees and competitors.
When it works well, the Mining and Deciding
tactic can yield critical and previously unavailable
insights (human capital) on what drives value. If
standard operating procedures, such as a new
customer service process, then organizational
capital is created.
The Mining and Deciding tactic brings risks.
Social media data is often unreliable (e.g., false
product shortcomings), and discussion forums
and call logs are messy and huge. Text mining
does not have the same precision as numerical
data analysis, and natural language includes
deceit and abbreviations. Yet, despite the
messiness and analytical challenges, the data may
in aggregate be predictive. That is why there is an
immense opportunity to generate capital from
social media data.
Implementing the Mining and Deciding
Tactic
the appropriate mix of tools, skillsets and data.
generate and improve capital (see Table 2).
Social media have created an unprecedented
opportunity for organizations to expand their
horizons by providing new communication
can be augmented by environmental scanning to
add human and organizational capital (Flow 2).
External communities and forums (Flow 3) are
challenging because they often involve chaotic
among the members of the organization and the
104 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
external environment of customers, suppliers,
regulators and others. However, when there is
a structured process in place to mine this bidirectional
interaction it can generate valuable
human and organizational capital to aid strategic
decision making. For example, an organization’s
branded customer-directed social media
channels can be mined to learn about common
support problems and be used as a foundation
for improving customer satisfaction. This can
add human capital to marketing and increase
organizational capital by improving product
design.
not a new idea and has manifested itself in
various forms over the past two decades (e.g.,
groupware). However, the low cost, ease of use
offered by social media means that social
media are supplanting traditional means of
implementing organizational communities. The
human and organizational capital by capturing
expertise. For example, some companies use
blogs and wikis to capture knowledge from their
most experienced employees.
The Listening and Branding tactic is
3. The Conversing and Sharing tactic and the Cocreating
and Innovating tactic (discussed below)
are implemented through Flows 3 and 4. The
most ambitious social media strategies extract
valuable insights by carefully mixing all four
To implement the Mining and Deciding social
media tactic, organizations need an appropriate
mix of tools and expertise to manage and
newsfeeds and call logs). Combining traditional
structured data (e.g., customer IDs, date stamps),
unstructured data (e.g., comments on a blog) and
data that can be structured (e.g., times a product
is mentioned) with pure unstructured text
(e.g., a review) can enhance the generation of
the patterns of interaction and identify opinion
leaders. The analysis can track the impact of a
particular comment as it spreads by word-ofmouth
through one or more networks, much like
a virus propagates. Valuable insights can arise
through the cross-validation of transactional and
social media data (e.g., a product that is selling
well but getting negative reviews might indicate
To implement the Mining and Deciding
tactic, organizations will need to invest in
existing infrastructure, such as extending data
warehousing and risk management to control
large, messy and potentially litigious social
media datasets. Since privacy and liability
regulations and cultural sensitivity vary by
country, there is an inherently greater risk of
making a mistake in analyzing social media
Table 2: Mining the Social Flows
1.
2.
3.
4.
June 2014 (13:2) | MIS Quarterly Executive 105
Generating Capital from Social Media
(e.g., U. S. pharmaceutical organizations must
report adverse reactions to the Food and Drug
Administration (FDA); with social media,
this could result in thousands or hundreds of
thousands of reports).
The sidebar on the right provides an example
of Mining and Deciding in the context of Obama’s
Mining and Deciding Tactic Key
Insights
As shown in Table 2 above, social media
have created an unprecedented opportunity
for organizations to expand their horizons by
providing many more channels for scanning
and improving their human and organizational
capital.
bi-directional; analyzing only one-way effects,
such as recording Facebook Likes, misses the
reciprocity that encourages co-creation and
presidential campaign, the more a candidate was
discussed by traditional media, the more Twitter
Facebook conversations, as well as traditional
media, and so on.
Organizations should both fear and desire
the bandwagon phenomenon where brands
spiral of ever-increasing exposure. The
bandwagon can operate within and across all
also Table 2). Organizations that can differentiate
through mining and purposeful decision making
new capital.
Most organizations have mature business
intelligence strategies for transactional data.
required to analyze social media data may mean
that social media mining has to be a separate
activity. Nonetheless, the largest payoff is when
organizations can merge social media and
enterprise data.
The Mining and Deciding social media tactic
can generate valuable human and organizational
capital when organizations use the data to
ask questions that yield new patterns that can
insights (human capital). These types of capital
generation depend on the prior establishment of
organizational capital for capturing, storing and
11
Social Media Tactic 3:
Conversing and Sharing
The Conversing and Sharing social media
ideas and knowledge in a network. It is about
forming a community and the overall pattern
of connections: whom you reach and how
you reach them, and how network members
11 Wattal, S., Schuff, D., Mandviwalla, M. and Williams, C.
“Web 2.0 and Politics: The 2008 U. S. presidential election and an
e-politics research agenda,” (34:4), 2010, pp. 669-
688.
other.
11
the Chicago Tribune
106 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
participating in discussion forums, creating a
blog to share knowledge with peers, looking
for an expert on LinkedIn, forming a group in
Facebook to share best practices or creating a
SharePoint site to facilitate knowledge exchange.
The Conversing and Sharing tactic builds social
capital by creating linkages among community
members. By carefully injecting itself in social
media conversations, an organization can build
social and symbolic capital that lead to new
human and organizational capital. Organizations
need to understand the power of many-tomany
communication, including the high speed,
low formality and low level of control within a
community.
The risks of implementing the Conversing
and Sharing tactic include security, privacy and
intellectual property challenges in engaging
within and across organizational boundaries.
Organizations can lose focus by conversing
too much, in which case the tactic becomes a
sinkhole with no clear business value. Further,
organization joins or establishes a community
only to discover that group norms resist sharing
and reuse.
Implementing the Conversing and
Sharing Tactic
Humans readily converse and share, and
organizations can tap this instinct to implement
outside or across organizational boundaries.
To generate capital, conversations must be
sustained beyond the novelty period, and
social mechanisms and platforms to prolong
engagement are essential.
There are four models for sustaining
conversations (see Table 3). The network effects
model is relevant for maintaining human, social
or symbolic capital generation. Organizations
that require in-depth knowledge sharing and
reuse to generate valuable organizational capital
will likely need to more precisely understand and
apply the mechanisms for the other three models
so that they can continue to duplicate and sustain
use.
Organizations also face challenges in
conversing and sharing. This is partly because
approaches that mix the models described in
Table 3. One way to differentiate platforms is
through feature sets. Yet the implementation
challenge is almost always sustaining conversing
and sharing, not features. So the implementation
of the Conversing and Sharing tactic should
start with the capital goals, followed by
and then alignment with a platform. For example,
Facebook (or a similar platform) is rich enough
to sustain the social capital model, while a
lightweight platform such as Twitter messaging
can generate network effects. A full-featured
document and collaboration platform such as
Table 3: Models for Sustaining Conversations
Model Mechanism
Social
Social
Exchange
involvement
Network Engagement is driven by the number
June 2014 (13:2) | MIS Quarterly Executive 107
Generating Capital from Social Media
Microsoft’s SharePoint could support all four
models but at the cost of additional complexity.
The sidebar on the right describes how
Lockheed Martin Unity implemented the
Conversing and Sharing social media tactic.
Conversing and Sharing Tactic Key
Insights
Top management buy-in is a standard mantra
for most projects. But when implementing the
Conversing and Sharing social media tactic,
the requirement is much less about buy-in
than it is about participation; top management
participation is critical for success because
of human capital. An organization’s human
capital will need continual guidance, examples
and leadership from executives who have the
Lockheed Martin, the project was championed
by top management down to line managers.
will also need a community manager to lead
the conversation and identify and manage
appropriate rewards and incentives.
Organizations will typically need to provide
incentives to sustain involvement with the
Conversing and Sharing tactic. However,
paid experts may see them as demeaning.
Lockheed Martin experimented with
various incentive schemes (social exchange), but
in the end, defaulted to slowly and continuously
understanding and changing the culture (social
capital).
enhance social and symbolic capital and lead
to valuable human and organizational capital.
Social media present an opportunity to extend
organizational learning networks and reach
capital. There is an opportunity to uncover
successful practices and convert them into
enterprise procedures (organizational capital).
To generate this capital, the organization must
12 Based on interviews with users and managers, analysis of the
platform, and survey and archival data.
Social Media Tactic 4:
Co-creating and Innovating
The Co-creating and Innovating social media
tactic is about sourcing ideas, evaluating and
garnering solutions from employees, customers
thus about crowdsourcing, getting ratings and
reviews, and awarding achievements to the best
source. The goal of this tactic is to engage a wide
range of stakeholders in the mutual creation of
innovative products, processes and services. An
example would be running competitions through
TopCoder to source solutions from a large
number of experts or empowering employees
to use a prediction exchange to identify new
products and sources of revenue. Fundamentally,
the Co-creating and Innovating tactic is
about developing organizational capital (e.g.,
product improvements) that can be converted
into economic capital. However, success will
depend on recognizing that this tactic leverages
distributed individuals who are often outside the
normal hierarchy (e.g., content from consumers,
open source cooperative activity undertaken in
13 http://www.topcoder.com/
108 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
the public sphere and crowdsourced ideas from
outside the organization).
When co-creation works well it can lead
to innovation as well as solutions to complex
waste of time and energy for participants
and demotivate the very individuals that the
organization is trying to leverage.
Implementing the Co-creating and
Innovating Tactic
and Innovating tactic include getting a project
started, getting buy-in, and ensuring highis
to establish which of the four approaches
to implementing the tactic, shown in Table
4 (marketplace, community, incubator and
clan), is most appropriate and then actively
managing the process to ensure success. The
chosen approach should match the organization’s
capital-generation goals. For example, a
showy externally visible one-off marketplace
often generates symbolic capital but little
organizational capital. A sustained community
conversely may generate social capital but
requires more effort to create organizational
capital.
A formal project management approach
is needed to implement the Co-creating and
Innovating social media tactic. This will help to
avoid the risks as well as the tendency to lose
14 Adapted from Yoo, Y. and Hill, T. L. “Managing Open
Innovation: How and What to Open,” Temple
University, 2010.
organizations are better off outsourcing project
management because the required skillsets are
unique and expensive.
The sidebar on the next page describes the
Popular Science Predictions Exchange (PPX),
innovation platform.
Co-creating and Innovating Tactic Key
Insights
Organizations implementing the Co-creating
and Innovating social media tactic need reliable
stewards to broker their interests in public
forums. The intents and processes of co-creation
are hard to communicate, and the problem
is exponentially increased with unknown
to control. Organizations should build checks
smoothly. Gaming (e.g., as in the Popular Science
Predictions Exchange) remains a serious concern
since publically available rules and algorithms
are susceptible to manipulation. Organizations
and policies to deal with disruptive elements.
There is a paradox because those who seek to
game are often the most creative and motivated
contributors.
Appropriately managed co-creation and
innovation can generate new organizational
capital in the form of new procedures and
15 Based on participant observation, commentary on public
discussion forums and Wikipedia (http://en.wikipedia.org/wiki/
Popular_Science_Predictions_Exchange).
Table 4: Four Approaches to Implementing the Co-creating and Innovating Tactic
On-line
Marketplace
Ideas
Incubator
Community
Solves problems
Clan
Evolve into labs
June 2014 (13:2) | MIS Quarterly Executive 109
Generating Capital from Social Media
products, and also generate social and symbolic
capital. Investments in organizational and
human capital must be made to release the latent
capital embedded in an enterprise. Leveraging
a larger and previously inaccessible pool of
human capital to drive innovation to generate
organizational capital can yield high payoffs. In
addition, the tangible costs are small and even
micro innovations can provide a good ROI.
A Case Example of
Moving from Tactics to
Social Media Strategy
In the social media era, the most successful
identify capital goals and select appropriate
tactics to create a comprehensive social media
strategy. The next sidebar describes how one
The evolution of its social media initiatives is
16 Based on participant observation, news reports and Piskorski,
M. J. and Chen, D. Harvard
Business Publishing, 2012, pp. 1-24.
Popular Science with a vir
tered members.
providing power to players to develop a sense
new username. The administrators had to keep
mate players.
Engagement with small businesses: The online
ing. “Small Business Saturday” provides rewards
Engagement with consumers: The “Members
Engagement with merchants
110 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
Amex’s social media strategy started
with a fairly typical branding effort and
then moved to more sophisticated tactics
of listening, encouraging conversations and
sharing knowledge among its customers, and
maintaining and pushing its brand with relevant
content. The Members Project sustained
interesting conversations, but its attempt at cocreation
(identifying causes) ends with funding,
which though worthwhile, only produces
value for unconnected participants, and little
engagement. The strategy evolved to a fully
realized Facebook presence (supplemented by
Twitter) that includes listening to customers on
various channels, sustaining conversations, and
apps for sharing and planning. The Facebook
presence provides a platform in both the
technological and conceptual sense to generate
and sustain social, symbolic and ultimately
economic capital.
Smart Offer connects customers and
merchants using various attributes while
Figure 6: Evolution of Amex’s Social Media Strategy
Listening &
Branding
Mining&
OPEN
Branding
Project
Conversing
& Sharing
Co
Twitter
Listening &
Branding
Listening &
Branding
Conversing
& Sharing
OPEN
Listening &
Branding
Conversing
& Sharing
Conversing
& Sharing
Small
Business
Listening &
Branding
Consumers
June 2014 (13:2) | MIS Quarterly Executive 111
Generating Capital from Social Media
maintaining privacy and convenience. Offers are
pushed out on different platforms to leverage
word of mouth among consumers, and facilitate
listening and branding among merchants, as
decisions. Consumers can also search for and
manage these offers, providing both parties with
corresponding mining and deciding toolsets.
Amex’s strategy of applying social media to
create a digital platform is a leading practice
because it:
Moved the company from relatively
initiatives to a suite of interrelated
continuing activities that engage its
stakeholders
Integrated different social media tactics
into a comprehensive social media
strategy
Evolved from an initial focus on
generating social and symbolic capital to
generating organizational and economic
capital.
Case Comparison of Capital
Investment and Generation
Social media provide organizations with
diverse options for generating capital. In Figure
placed in a relative position, and the primary
capital-generation activity is indicated with a
plus or minus sign. The placements illustrate
the relative capital-investment and capitalgeneration
opportunities rather than absolute
scores.
The comparison suggests:
1. Even though the entry cost is relatively
low, to generate sustained value,
Figure 7: Comparison of Capital-Investment and -Generation Opportunities
Lockheed
Human Capital +
+
Project
+
Amex Smart
Offer
+
+
+
+
+
PPX
+
-
112 MIS Quarterly Executive | June 2014 (13:2) misqe.org | © 2014 University of Minnesota
Generating Capital from Social Media
organizations will need to invest
and symbolic capital.
2. It costs less to acquire symbolic capital
than other capital. It is also easy to lose.
3. Generating economic, human and
organizational capital will likely require
in-depth investments in the Conversing
and Sharing and the Mining and Deciding
social media tactics.
4. Creatively integrating social media tactics
will likely yield the most promising
capital-generation opportunities in the
future.
To enable organizations to assess relative
capital-investment opportunities, we
differentiate in tabular form the four social
media tactics (see Table 5). The comparison is
based on our experience in analyzing, advising
and building social media strategies.
Generating Capital
Out of Social Media
think broadly about the types of capital you
how you will apply the four social media tactics
to accomplish the goals. Isolated action will
can create interactions that multiply the value
of investments. For example, the Listening
and Branding tactic can complement the Cocreating
and Innovating tactic to promote
new services under the existing brand. Third,
social media opportunity into a larger capital
pool. Capital is required to create capital, and
when appropriately invested, it can have a
multiplicative effect.
The use of social media by businesses
is a social and economic reality of massive
most organizations with messages from
customers, employees and other stakeholders.
Floods can bring destruction, but they can also
Some executives might see social media as an
of individual opinions. We have shown how this
deluge can be converted into a systematic and
sustained opportunity to recharge the enterprise
with new capital that enhances its ability to
compete.
Appendix: Research Approach
This article is based on a case study approach,
with a mini-case relevant to each of the key
Table 5: Social Media Tactics Comparison
Skills Needed Risk Structure
Measures
Listening and
Branding
Human Medium High High
Mining and
Deciding
Human Low High High
Sharing
Human Community
management
Knowledge
management
High
Medium Low
Digital
entrepreneurship Medium
Low High
June 2014 (13:2) | MIS Quarterly Executive 113
Generating Capital from Social Media
elements of the framework integrated into the
narrative. Each mini-case was sourced through
interviews, analysis of public documents and/
or where applicable, review and evaluation of
of the framework were deduced from the
mini-cases as key concepts to describe the
relevant phenomenon. The framework was then
iteratively developed and improved by:
Feedback from two sessions with the
Advanced Practices Council of the Society
for Information Management (SIM APC),
a group of about 35 CIOs from major
organizations
Review and feedback from sessions
with SIM chapters in Philadelphia and
Alabama, as well as from a SIM-sponsored
webinar and a webinar for all IT
employees of a major bank
Application and revision in two Executive
M.B.A. classes
Review and feedback from social media
practitioners, including the founder and
owner of two social media consulting
Lockheed Martin and Campbell Soup
Company.
About the Authors
Munir Mandviwalla
Munir Mandviwalla (mandviwa@temple.edu) is
an Associate Professor and founding chair of the
Management Information Systems department,
and Executive Director, Institute for Business
and Information Technology, Fox School of
Business, Temple University. His interests include
collaborative systems, social media, peer review,
globalization and universal access, and his work
has been supported by grants from NSF, SIM, Bell
Atlantic, IBM, Microsoft, CIGNA, Advanta, Lotus
and Lilly Endowment. He is currently studying
social media use in higher education using
complex adaptive systems theory.
Richard Watson
Richard Watson (rwatson@terry.uga.edu)
is a Regents Professor and the J. Rex Fuqua
Distinguished Chair for Internet Strategy in the
Terry College of Business at the University of
Georgia.HeisaformerpresidentoftheAssociation
for Information Systems and the current Research
Director for the Advanced Practices Council of the
received the Association for Information Systems’
LEO award, which is given for exceptional lifetime
achievement in information systems.