Social Media And Social Network In An Organization Commerce Essay

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"Social media and social networks have changed the way we communicate and work in organisations". Do you agree with this statement? Yes completely agree with the statement, because they have made communication or networking a lot easier. In other words would say they have united the world. Social Media consists of websites such as Facebook, Twitter, Google+ and they have been escalated in the last few years. More people are in touch with each other by interacting online, and it's easy to find new and exciting business. Business promotes themselves nowadays on social media sites; they are following their customers on these social media websites. It has become lot easy for an organisation to communicate with the customers on a personal level and in new ways. They help to interact in meaningful way and the customers can understand sometimes the people working behind a business.

"A social network is one of many possible sets of social relations of a specific content - for example communicative, power, effectual, or exchange relations - that link actors within a larger social structure (or network of networks)" (Emirbayer and Goodwin, 1994: 1417)

Social media is at the top most important agenda for business organisations, because that helps them to make profits by the use of applications, such as Wikipedia, Facebook, Twitter, Second life. But then social media has a different concept than Web 2.0 and User Generated Content. The Applications which are subsumed under social media are Micro-blogging, Content Communities, virtual world games and Virtual social worlds. Michael(2010,p.59) discusses "According to Forrester research, 75% of internet surfers used "Social Media" in the second quarter of 2008 by joining social networks, reading blogs, or contributing reviews to shopping sites; this represents a significant rise from 56% in 2007".

The two key elements of social media are media research (social presence, media richness) and social processes (self-presentation, self-disclosure).

Table1. Classification of Social media

What are the Blogs and Twitter?

A blog is a webpage that can be updated regularly with dated entries containing text, video, or any other media. Twitter ( is a form of 'micro-blogging', where updates (tweets) are limited to 140 characters-long enough for a short opinion or report, and perhaps a link to any other article on the internet. Both of them help in making communication very efficient and instantaneous, as in twitter when someone is mention they are notified that moment itself. Social media has the potential to substantially impact word of mouth, which helps the organisation to build the relation with the customers directly. Word of mouth is the process of conveying information from person to person and plays a major role in customer buying decisions (Richins & Root-Shaffer, 1988). Brass-tacks construction has been one of the keys to its success. In twitter with the use of third party developers and the extension of it by huge number of users, it has grown to be one of the most popular social media site in the past several years. It has nurtured different people for the easiest way to reach out for their voice and get the response in return. Twitter has played a crucial role in informing people about the natural disasters and the global consciousness or political issues, and it is the easiest way to reach to people. It has grown to be the centre of communication from being a standalone social media platform.


This social network website created a world for people without being far from each other in virtual terms. It began in 2004 just as another social networking site such as Friendster, but then at that time the rising star, MySpace, offered a trendy communication. On the other hand Facebook offered something very similar to a successful online business, and it had its own exclusivity. According to Hansel, Shneiderman, Smith (2011,p.165) the site started among Harvard students and then took and incremental approach to growth, first adding users at select universities, followed by virtually any university, and only then the general public. This approach gave Facebook two advantages over the competition. The first is that because students at most universities are already well connected to each other, the site could benefit from "network effects" early on. The second is that its origins at Harvard coupled with a cool blue and white aesthetic (in contrast to the anything goes aesthetic of the competition) signified the sort of legitimacy that invites older and more sceptical users into the fray.

Virtual Social world

Second Life or virtual worlds in general, are part of a larger group of Internet-based applications known as social media. This term is used to describe Internet-based applications that help consumers share opinions, insights, experiences, and perspectives. Companies can make use of second life in different ways such as market research, human resource management, virtual product sales (v-Commerce), and advertising, internal process management.

Social networking has taken in complete different manner when it comes to communication, they have change the way people look at internet now, it's not the same what it used to be, now you get almost all the information, or in other words everything is on internet, and we can get it with few fingertips on the computer. Social network helps to communicate people with same interests, ideas, and it opens up to interact with people whom we never know. For everything there's some pros and cons, when it comes to social networking we need to understand the importance of it and how it influences. People now use social communication to shape the culture and events in the world, everything happens really fast in terms of this communication.

Construction Projects in China using Social Network Strategy

Network is the utmost important factor for determining the social and economic relationships; exchange of network is determined by the use of networking. To support the statement am narrating the use of network strategy to manage construction projects in china. There are researches done to find the importance of social network strategy that the architectural firm use it for the construction projects in china. In support of this research total 82 sets of data were collected and interpreted stating that not only the Chinese firms used the strategy of network for construction but also the foreign A/E/C firms use it to a significant extent. This helped them to achieve positive project outcomes and the competitiveness. The Chinese firms are headquartered in mainland china, where the other operating foreign firms were headquartered outside mainland and greater china. Granovetter's (1985) Network theory of Embeddedness suggest that an economic action is embedded in a network of social relationships which include social obligations, kinship obligations, knowledge of the identity of transactors. According to Granovetter's a firm should look beyond market and profit relationships, and consider also social relationships. The construction firms heavily rely on people for each stage of its procurement, because there is network chain with complex links among member's such as contractors, clients, governments, consultants, suppliers and customers. Network in the construction industry exist in the form of reciprocal services which involve the giving and receiving of mutually supportive products/services to other firms in the network (Cheng et al., 2000)

For the uninterrupted flow of information along with the supply chain the organizations requires the excellent communication channels and effective network. In China, the concept of network is known as Guanxi, which is looked as an important competitive capability (Cheah et al., 2007). Guanxi has two kind of interpretation, called as narrow and wide. Whereas in the concept of social network we use the networking, personal connection or relationship in the wider interpretation. Wong (2007) found that guanxi plays an important role in business, not only personal benefit but also for the harmony of the community. Li(2011,p.3) discusses in this project they started with the theoretical framework of competitiveness combining Porter's(1980) generic competitive strategies, Sun Tzu's military strategy and social network strategy. Based on the reviews of the research the data was collected in the form of a questionnaire and was designed it for the survey. It was planned in the three different sections. In the first section they required respondents to provide some general information on themselves and their firms. In the second section, respondents were asked to evaluate their organizations competitiveness with the major competitors and the method was kind of evaluating the competitiveness on the scale of seven.

The highest was seven and the least was one, whereas in the third section, the respondents were asked to rate the extent of which their organisations adopted the strategy. But before this survey was introduced there was industry based survey conducted with the help of three Chinese and three foreign subject matter experts. The data that was collected and was statistically analysed with the help of SSPS (Statistical Package for Social Science) Software.

The data analysis is shown in the Appendix, and the entrepreneurs with more social contacts and network ties are usually able to obtain more opportunities and information than then others who don't have much network resources.

Relationship formation

The foreign organisations form guanxi when managing projects in China. Gaunxi is basically formed by extensive form of networks. Chinese firms do it by increasing more number of partners and by having number of partner's means more opportunities, by this they expand their services to cover more of the market segments. In other words the social network strategy helps the Chinese organization's to build a relation with the foreign firm's so that they get more motivation by involving compatible goals and this always help for the better performance of the projects. And the network between them needs to be cultivated continuously, so that the trust factor remains true all the time. Trust is the starting point for setting up a relationship (Kadefors, 2004), as well as a critical factor in ensuring the success and continuity of that relationship (Cheng and Li, 2002). After the formation of relationship, it's very important for the continuity, and for this they form a proactive network which is calculative networks linking diverse set of functional or work based ties (Hite and Hesterley, 2001). The growth of the china's construction market had many projects available; hence there was more competition in between the Chinese organization's and the foreign firms. So by the use of social network strategy they were able to come along together with the better projects outcomes.

Organisation benefitted from Social Network

Now to justify whether the social media and social network has changed the way communications in an organizations, how an organizations benefitted from online social network, in order to develop a strategy for its future, an $8-billion energy company wanted a forces that would influence its industry. Before thinking of getting this strategy the company used the external consultancy to conduct a building process with top 15 officers, but then the result were disappointing, so to get deeper they got involved more deeper in the use of social media strategy with the employees of the organisation. It wasn't feasible to conduct all-hand meetings, as the company was in hurry. So they developed an online network to connect all the employees and recommend their suggestions and comments, and this worked better because the people knew what was going in and around. People came up with different ideas from all the levels of the organisations and this helped in the strategic planning process. As one participant put it, "For the first time I know what's in the minds of my colleagues on a day-to-day basis."

In an organization people are distributed across time and space, for these the activity needs to take place online, so that they enhance the company's shared knowledge and be effective in terms of time management. Thoughtfully designed and expertly implemented online social networks can allow an organization to:

Start inventing together when they are connected online because that helps them to go beyond problem-solving.

Before time warning system. (This helps the people in an organizations alert that their idea affects other's plan or resources).

People are connected and relationships are building across boundaries of geography or discipline.

Effective way of exchanging knowledge than memoranda.

Training can be improved into a continuous process, not separated from normal business processes.

Jane Binnion, the social media consultant said there are different ways of employing strategies and some basic rules that all business organisations should follow if they want to succeed.

Be more social; engage yourself in, rather than just announcing.

Be effective with the people in terms of communication, while establishing a presence on social media.

Be more focussed on the platforms where potential customers are likely to be.

Be adaptable. Adapt the strategies accordingly to the development in the social media and measure the activity and responses.

"Business is all about relationships; be generous, be interested in other people, invest the time and effort, and it will pay off," adds Binnion.

Survey by KPMG for the use Social Network Strategy

Participating in the social networking has become an essential. More than 70 percent of an organization is engaged in the social media. Many are finding it that social media has important benefits and unpredicted risks along the way. KPMG surveyed more than 1,800 managers and 2,000 employees at organizations in ten major markets and found that - in many cases - there remains a significant gap between expectation and reality when it comes to social media. The taking up of media is widespread all over the world for business, especially in the emerging markets of China, India, and Brazil who on an average are 20 to 30 percent more like to use social media than Germany, UK, and Australia.

By looking at the graphs, many of the developed country are lagging behind their peers in the up-and-coming markets; this indicates there is significant room for expansion in the advanced economies. Businesses are basically using for the improvement of relationship with the customers, but also to be innovative in terms of products and services, and for staffing as well. All over the world, two thirds of respondents suggested that their organizations were either growing or initiating plans to make use of social media for sales and marketing purposes and six in ten cited uses of social media in business development. Almost six in ten respondents also said they communicated directly for customer service purposes. And while reasonably less frequently cited, 57 percent of respondents also suggested that they were either in the process of expanding or about to initiate plans to leverage social media as a catalyst to developing new products or services. (KPMG, 2011)

These are the few factors that are evaluated while achieving success in terms of social media, by looking at the graph we see the most influencing factor for an organisation is to be continuously involved in the new social media opportunities, and some organisation think they need to invest a lot for funding their social media services, whereas we clearly know that success is directly related to the new ideas, not the size of the budget. So the organisations look the social media as a functional strategy rather than a business one.

With more than 80 percent of respondents citing benefits and only around 40 percent identifying any one risk, it seems clear that the exploitation of social networks should be an organizational imperative.


KPMG helps organizations to develop and identify opportunities related to social media. No matter how big or small is, or may be the organization has just started, well experienced. Our professionals from the global network bring a business 'hype-free' approach and an inclusive social media style, tailored to your specific needs. With experience across many industries, our team has in-depth knowledge from organizations who have been there before, and draws on specialist expertise from our strong social media alliances.

'Organizations cannot afford not to be listening to what is being said about them or interacting with their customers in the space where they are spending their time and, increasingly, their money too'.

Malcolm Alder, Partner, KPMG's Digital Economy practice KPMG in Australia


Every business needs a strategy to grow up in the market, in the report we discuss the criteria of social network and social media enhancing the communication in an organisations, we have presented the case sample, social framework and different methods. There are three main important aspects to improve in this terms which is Listen, Learn and Innovate. Organizations should not rely on the external consultants rather than implement the social network strategy in terms of communications. To support the strategy the network should be conversational, rich, and continuous and involve everyone in the organisations. Many people believe that face to face is the better way to communicate in an organisation, but then we have justify that the communication gets lot easier in the social network strategy, because it involves everyone in the discussions. Conversation is the lifeblood of today's organisations. The most advantage of social media is not how much information or knowledge they can put at disposal in the organisation, but they make the conversation possible. Overall, there are a lot of costs involved with the development in the social network strategy, but then the outcome is substantial and it outweighs the costs.