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Six Steps to an Effective Social Media Risk Management Strategy

According to Raj Chaudhary, a principal in Crowe's Risk Consulting practice, one of the most potentially damaging risks from social media can be to an organization's reputation. "Employees, customers and vendors can be an organization's greatest ambassadors or can seriously undermine its brand and image," he said. "While no one can control or change this feedback, it can be monitored and responded to in a timely manner, as appropriate." Other possible issues Chaudhary mentioned include legal, employment and information security risks.

In order to help manage these risks, Chaudhary suggests that organizations document and implement their social media risk management strategy by taking the following actions:

    1. Engage a multidisciplinary team. Since social media activity affects a
       wide range of functions, representatives from the following teams should
       be brought together: human resources, legal, information technology,
       marketing, risk management, public relations, compliance and any other
       affected functions.
    2. Document current and intended social media use. The team should define
       how the use of social media aligns with organizational objectives and
       each department should report how it uses or intends to use social media.
    3. Perform a risk assessment. Based on the information received in the
       documentation step, the organization should then conduct a formal review
       of risks associated with social media. The multidisciplinary team should
       determine what steps, if any, have already been taken to control or
       mitigate risks such as defamation of the company, its products or
       leaders.
    4. Expand current policies to include social media and implement safeguards.
       This step requires that organizations review and enhance current policies
       to cover use of social media. This should include appropriate and
       inappropriate employee use of social media, information security policies
       to protect information, marketing and communications, as well as vendor
       management policies.
    5. Provide social media training. For the policies to be effective, it's
       critical that organizations educate their workforce on the social media
       policy. Ongoing training sessions should include appropriate and
       inappropriate communications, highlight the constant threats present on
       social media sites and distinguish between the positive and negative use
       of the medium.
    6. Monitor social media channels. Organizations should also consider how
       they will stay current on social media chatter that might have an impact
       on their objectives. Social customer relationship management (CRM) tools,
       comprised of software products and vendor services, help organizations
       monitor by listening on public channels for social media chatter that
       affects the organization.

"Social media channels represent far more than an intriguing business opportunity. They have become part of the fabric of social interactions for an increasing segment of the population," said Erika Del Giudice, senior manager in Crowe's Risk Consulting practice. "Organizations that implement social media guidelines that promote the responsible use of social media will be better equipped to reap the new medium's benefits."

For more information on this topic, please visit: www.crowehorwath.com/socialmedia.

About Crowe Horwath

Crowe Horwath LLP (www.crowehorwath.com) is one of the largest public accounting and consulting firms in the United States. Under its core purpose of "Building Value with Values®," Crowe assists public and private company clients in reaching their goals through audit, tax, advisory, risk and performance services. With 26 offices and 2,400 personnel, Crowe is recognized by many organizations as one of the country's best places to work. Crowe serves clients worldwide as an independent member of Crowe Horwath International, one of the largest networks in the world, consisting of more than 140 independent accounting and management consulting firms with offices in more than 400 cities around the world.

SOURCE Crowe Horwath LLP