The Siren Song of Social Media Metrics
Social Media Activities and Metrics:
Avoid Destruction by the Seductive Siren Song of Social Media Metrics
Among the most important steps for social media success is activity selection. Social media are not projects; they are conceived and led as complex activities. Elaborating and recognizing business outcomes makes activity selection and social media activation simple.
Recall the sole purpose of commercial business is to create free cash flows (FCF). This cash is distributed among the holders of securities and owners of the business.
Your social media activities must achieve FCF. All business people are fiduciaries. They are charged with creating FCF from capital. No exceptions. If you aren’t doing this for your company or yourself you must question, re-think your role and commercial vocation.
It is essential to start with outcomes and work backwards to define your social media activities. A multi-faceted perspective to reach your outcomes is essential. Never use ascribed metrics to define the value, purpose, goal or outcome of your social media efforts. Social media metrics are not causal. Metrics are anecdotal at best.They may be used from time to time to casually, not causally, inform the execution of social media activities.
Social media are complex adaptive systems. You must account for signals, attractors and emergence. Allow, embrace and encourage stochastic, chaotic and other non-deterministic properties and behaviors for social media. Fine-grain, attributed social media metrics are harmful to achieving purposeful and prosperous outcomes for complex social media activities. Rather, a complex, multi-dimensional interpretation is required for social media success. Order evolves from interactions not from control.
Social media do benefit from quantitative measurement vis-à-vis creating business value. Remember, continuous business value creates wealth, prosperity and well-being for all people, democracies, economies and civil societies. Social media lead ambient value flows and innovation streams.
Business value, the valuation of business activities, uses discounted cash flow (DCF). All business activities must drive DCF. Social media is no exception.
There are only six ways to improve DCF.
1. Decrease Expenses
2. Increase Profit Margin
3. Increase Revenue
4. Lower Taxes
5. Decrease Amount of Rqr’d Capital
6. Decrease Cost of Capital
All social media initiatives must drive one or more of these canonical DCF properties. If they don’t, abandon them immediately. If you can’t find a social media activities that directly expands and develops DCF, do not pursue. The stakes are too high. Honestly, activities that aren’t driving DCF, aren’t creating business value, are no use to anyone.
Enterprise projects and social media activities fail because they cannot be linked to DCF improvements. It creates more grief and failure than any other reason. Elaborate the DCF benefits and advantages and your social media activities will accelerate and prosper. Leave them off and they will be rightly killed.
Well conceived and executed social media do achieve mastery of intangibles. Intangibles have a direct, immediate and sustained impact to DCF. Social media lead network intangibles for DCF improvements. Social media and DCF aid triple bottom line strategic thinking. With DCF they are instrumental in furthering the people, profit, planet outlook. DCF-led social media are a practical, whole system approach to business execution.
Concerning social media product and project selection, ask you supplier how their offering(s) drive DCF. Suppliers must show how their offerings fundamentally improve business value. If a supplier cannot comprehensively articulate how their clients are achieving improvements on at least one of the DCF requirements, move on immediately.
No matter how enchanting, avoid the siren song of social media metrics. Above all, for social media success, keep it real, and traced to DCF!