Social Media and RO__why?
March 13, 2008 2 Comments
A thought-provoking post by Debbie Weil on the ROI of Social Media had the effect of…well, provoking some thought.
I’ve always had a hate-like relationship with ROI and its many first and second cousins (ROE, ROC, ROwhatever). The concept is sound at a certain level – if we invest (x), what will be our Return on that Investment? This works well in the tangible, definable, prior-track-record arena of business.
The problem is that it is a narrow, accounting-centric, and transaction-centric set of lenses. And not all decisions (both business and personal) are best viewed through the green RO__ eyeshades. Some things cannot be given proper value based on scheduled dollar returns. And some things, like Social Media, are emerging and evolving – no track record. We’re still making up the rules for crying out loud!
When it comes to Social Media and other aspects of business and life where measured returns are “squishier,” trying to do ROI calculations is a matter of undergoing artificial contortions (this has been true in the training industry, where I’ve been involved for many years). So you have to exercise judgment, faith, vision, and long-term thinking, answering this question primarily: is this likely to have a positive impact?
At the risk of oversimplifying the already obvious, I think a judgment about the value of Social Media and other such avenues can be made based on weighing these three factors, some of which don’t fit nicely into the simplistic RO__ model:
- Anticipated Positive Benefit (APB) – both long-term and short-term!
- Anticipated Potential Risk (APR)
- Anticipated Resource Allocation (ARA)
If the potential benefits outweigh the foreseeable risks, and there are sufficient time/people resources to move ahead – then why require make-believe ROI calculations? Just plow ahead and make things happen.
Just spewing here. What are your thoughts? I’m sure many of you are already running into the Business Borg (“ROI Resistance is futile…”) – how do you work around it?
(Image credit-tape measure)