The Social Organization

Managing Human Capital through Social Media

Amelia Manuti, Pasquale Davide de Palma

• Publisher: Palgrave Macmillan
• Year: 2016
• ISBN:
  9781137585356
• Topic: Business
• Subtopic: Management
• Index: Business

The Social Organization sheds light on how social media usage is transforming the way organizations make sense of their identity and processes. By adopting a human capital perspective and merging research from communication studies and management, it argues that social media could be fruitfully exploited by organizations as a competitive advantage.

1

Human Capital Reloaded: The Use of Social Media in Human Resource Management

Maria Cesaria Giordano, Amelia Manuti and Pasquale Davide de Palma

Abstract: The chapter aims at discussing the concept of human capital with reference to some of the main Human Resource Management practices (e.g., recruiting, talent management and marketing). The latter are re-read in light with the increasing use of social media as a strategic support to several organizational actions. Therefore, the authors discuss the challenges and opportunities granted by social media use in organizations and focus on the main implications that this revolution has had for human capital theory.

Manuti, Amelia, and Pasquale Davide de Palma (eds). The Social Organization: Managing Human Capital through Social Media. Basingstoke: Palgrave Macmillan, 2016. DOI: 10.1057/9781137585356.0006.

1 Introduction

Social media are one of the main current priorities for managers and executives who are engaged in identifying ways in which organizations can make profitable use of applications such as Wikipedia, YouTube, Facebook, and Twitter, just to quote a few. Despite this interest, there seems to be very limited understanding of what the term “Social Media” exactly means. Social media refer to a set of “internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of User Generated Content” (Kaplan & Haenlein, 2010, p. 61). Such phenomenon has diffused very rapidly in just a few years, having grown to now entertain 1.5 billion users, according to some most recent statistics (Chiu et al., 2012). Boyd and Ellison (2007) consider the phenomenon as “web-based services that allow individuals to (1) construct a public or semi-public profile within a bounded system, (2) articulate a list of other users with whom they share a connection, and (3) view and traverse their list of connections and those made by others within the system” (p. 7). Social media further distinguish themselves from traditional media, as they are a quite cheap and easily accessible tool while enabling individuals to both publish and consume information in a pervasive and very efficacious way. Consequently, social media have been classified as one of the most powerful sources for news, trends and marketing, especially when identified with well-known platforms such as Facebook and Twitter that are increasingly showing advantages both for individuals and companies. Through its interactive nature, this media channel has been a revolution not only for the communications of organizations, communities, and individuals, but has also grown an entirely new commercial marketplace (Chiu et al., 2012; Helft, 2012).

Following its success, social media have gained significant attention from scholars and practitioners, resulting in the production of a rich “how-to” literature (Sterne, 2010; Safko & Brake, 2009; Agresta & Bough, 2011). However, there is a lack of empirical research on the topic. Actually, current research appears to be highly focused on the demographics of users and on how organizations can exploit the media from a marketing standpoint. Despite the huge interest in social media, academic research is lacking and does not provide a fully detailed understanding of the phenomena (Kaplan & Haenlein, 2010). Current literature is often rigid, becoming quickly outdated, and does not underline the innovative and composite nature of the social media market and of its contributors – often failing to consider adequate empirical evidences. Another lack in academic research is the scarce investigation of how social media could be fruitfully incorporated in Human Resource Management, which can be a strategic ally for many different organizational processes.

In view of these, the aim of the present chapter is to discuss challenges and opportunities of social media usage in Human Resource Management. In this vein, the chapter argues that social media use in organizations, if properly managed and framed within the official organizational culture, could often contribute to enhance the organizational and individual processes (e.g., collaboration, knowledge sharing) that could mostly lead to a successful performance.

2 Human capital and social media

The concept of human capital is strictly linked to the added value people provide to organizations. As pointed out by Chatzkel (2004) “human capital is the differentiator for organizations and the actual basis for competitive advantage” (p. 338). Yet, what really makes the difference between organizations in terms of business success is the know-how they possess, namely, the capital of imagination and creativity expressed by their employees, which is actually unique if successfully managed (Ehrenberg & Smith, 1997). In this vein, human capital, meant as the stock of knowledge and skills, coming from the education, training, and experience of one’s own human resources, is an important element of the intangible assets of an organization, together with customer relations, brands, copyright, and company image.

According to Scarborough and Elias (2002) the concept of human capital could be interpreted as a bridging concept since it concretely shows the link between HR practices and business performance “in terms of assets rather than business processes.” In this perspective, human capital is to a large extent “non-standardized, tacit, dynamic, context dependent and embodied in people.” Therefore, workers should not be treated as passive assets to be bought, sold, and replaced. Conversely, they actively control their own working lives as long as they are allowed to grow up as persons and professionals in their job and to learn and to improve knowledge and skills. That is why basically no system of “human asset accounting” has succeeded in producing a convincing method of attaching financial values to human resources. Investments by employers in training and developing people is a means of attracting and retaining human capital as well as getting better returns from those investments. However, employers need to remember that workers, especially knowledge workers, may regard themselves as free agents who can choose how and where they invest their talents, time, and energy. Nonetheless, though human capital theory could be very fascinating for organizations, interest in it should not divert attention from the other aspects of intellectual capital – social and organizational capital – that are concerned with developing and embedding the knowledge possessed by the human capital of an organization (Schuller, 2000).

This definition of the human component of an organization in terms of human capital, as illustrated earlier, leads to a reconceptualization of the traditional Human Resource Management practices that manager and HR executives are used to adopt to keep their organization tough and competitive on the market. Indeed within the past 30 years much has changed in these terms but currently we are assisting to a further revolution as a consequence of the diffusion of social media even in the organizational context. The sections that follow will attempt at drawing some of the main changes that two important cornerstones in the management of an organization – namely, marketing communication strategies and recruiting process – have undergone after the introduction of social media.

3 Social media and integrated marketing communication strategies

One of the most diffused and almost “conventional” use organizations make of social media is to support integrated marketing communication strategies. Integrated marketing communications attempt “to coordinate and control the various elements of the promotional mix – advertising, personal selling, public relations, publicity, direct marketing, and sales promotion – to produce a unified customer-focused message and, therefore, achieve various organizational objectives” (Boone & Kurtz, 2007, p. 488).

Given this broader definition, it is uncontestable, however, that the diffusion of social media has radically redefined the strategies and tools used to communicate with customers, who in the meantime have gained an even more active role not only in consuming but also in generating contents (Blackshaw & Nazzaro, 2004).

Actually, new social media grant a wide variety of communication contexts to customers: from the most proactive ones as, for instance, the word-of-mouth forums and blogs, the company-sponsored newsgroup discussion, and the consumer product/service ratings websites to the most “traditional” ones such as customers’ mailing list and social networking sites.

In the meantime, while allowing a more dialogical communication with consumers, the explosion of these forms of exchange have become a major factor in influencing various aspects of consumer behavior including awareness, information acquisition, opinions, attitudes, purchase behavior, and postpurchase communication and evaluation.

Some successful case studies in the field (see among others General Electric, 2008; Procter & Gamble, 2008) show that when integrated marketing communication strategies clearly reflect the organization’s mission and vision they are more effective on consumers’ behavior. Actually, social media play three interrelated promotional roles in the marketplace as suggested by Mangold and Faulds (2009). First, social media allow companies to talk to their customers. Second, they allow customers to talk to one another. Third, social media also enable customers to talk to companies.

The first role is common with many other traditional internet-based tools. Namely, companies can use social media to talk to their customers through platforms such as blogs, as well as Facebook groups. These media may either be company-sponsored or sponsored by other individuals or organizations.

The second role played by social media is distinctive: customers can use social media to communicate with one another, as in a traditional word-of-mouth communication. This function of social media could be particularly useful to develop and to maintain a tough organizational identity and a good brand reputation, thus strengthening also consumer loyalty.

Finally, the third role of social media refers to the opportunity granted by these tools to give a direct feedback about the quality of the service and/or of the product, as in the case of customer relationship management.

Given these intrinsic potentialities Mangold and Faulds (2009) argue that, social media could be considered a hybrid element of the promotion mix because they combine features of traditional integrated marketing communication tools (companies talking to customers) with a rather innovative form of word-of-mouth (customers talking to one another), which is quite independent from the official marketing strategy, as long as consumers can produce, edit, and disseminate contents on their own (Ramsey, 2006; Vollmer & Precourt, 2008; Singh, Veron-Jackson, & Cullinane, 2008). This is the reason why several organizations aim to incorporate social media into their integrated marketing communication strategies (Li & Bernoff, 2008). Indeed, differently from what happened when a traditional communication paradigm dominated, contemporary organizations cannot control the content, frequency, timing, and medium of communications (Mayzlin, 2006). In this new social-media-driven paradigm, information about products and services also comes from the marketplace, that is, it could also have been produced by consumers, thus conferring a power to consumers that they have not previously experienced in the marketplace.

Consequently, consumer behavior has radically changed as well. In other words, even consumers who do not directly produce contents are demanding more control over their media consumption. They require on-demand and immediate access to information at their own convenience (Rashtchy et al., 2007; Vollmer & Precourt, 2008). They frequently use the various types of social media to conduct their information searches and to make their purchasing decisions (Lempert, 2006; Vollmer & Precourt, 2008).

Further, another implication of this new paradigm is that for many consumers social media are becoming a more reliable source of information regarding products and services than corporate-sponsored communications transmitted via the traditional elements of the promotion mix (Foux, 2006).

In view of this, social media use in this context urged a radical revision of the traditional paradigm of marketing communication. This could be useful both to investigate the ever changing attitudes of post-modern consumers and to formulate more efficacious integrated marketing communication strategies.

4 Social media as tool to attract and recruit human resources

Another quite diffused use of social media in organizational life is linked to the practices of employer branding and recruiting. Both uses are strictly related to job posting advertisement on the internet. This type of activity could be a profitable communicative option that matches job demand and offer. Yet, it could be used both from those organizations interested in conveying a positive corporate image and thus in attracting talents potentially interested in working with them as well as from individuals simply looking for a job (Sivertzen, Nilsen, & Olafsen, 2013). Some social networking sites (e.g., MySpace, Facebook) have even added classified sections for job seekers and job posters (Manuti, Cortini, & Mininni, 2005). However, even in this case, little empirical research (e.g., DeKay, 2009) has been produced on using social networking sites to attract and to recruit employees. Given the paucity of research on both employer branding and recruiting through social media, some key questions could be addressed as to better examine the implications of using the internet-based communications for these aims.

The first question is how the use of these sites for recruiting affects the level of job applicants’ skills. Some research on Internet talent selecting and recruiting in general has indicated that by relying on social media employers might get more qualified applicants, but also more unqualified applicants (see Mathis & Jackson, 2008). However, most of these sites allow for more targeted selection and recruiting (i.e., there are specific filters that allow to identify applicants by certain characteristics).

A second question is related to job seekers’ motivation and proactivity in job posting. This aspect could of course have important implications for the process of talent selection and thus for the definition of employer branding strategies brought about by organizations (DeKay, 2009). Yet, some empirical evidences show that the targets of applicants using different websites (e.g., LinkedIn, MySpace,...

Table of contents

• Cover
• Title
• 1  Human Capital Reloaded: The Use of Social Media in Human Resource Management
• 2  Communicating the “Social” Organization: Social Media and Organizational Communication
• 3  Enhancing Human Capital through Social Media: Promoting Skills and Learning through Technology
• 4  Managing “Social” Human Resources: Talent Management in the “Social” Organization
• 5  From Theory to (Good) Practices: Human Capital and Social Media According to Human Resource Managers
• Conclusion
• Index