The following literature review emphasizes the depiction of the advantages and pitfalls of the utilization of social media in the sector of business in the context of the overall strategic performance of the business. The research studies related to social networking and its comprehensive impact on business performance have been observed in management literature concerning different industries.
The dynamics of social networking evolve gradually over the course of time hence the requirement of variable approaches for analyzing social media’s relevance in the strategic performance of businesses. (Arregle, et al., 2015) The review would help determine the favorable implications of social networking to improve business profitability alongside reflecting critically on the gaps in the literature and presenting recommendations for addressing the disadvantages of social networking for businesses.
Definition of Social networking:
Social interaction through technological platforms can be considered the generic definition of social networking which has become increasingly popular owing to the proliferation of social media websites. Social media can be defined as the wide array of web-based and mobile-based technologies that assist in interactive communication with the help of the internet. The implementation of social networking has been profoundly observed in the improvement of an organization’s platform for developing its customer base as well as the marketing aspects of the organization (Batjargal, et al., 2013).
The foremost positive implication that can be drawn from the implementation of social networking is observed in worldwide connectivity. The use of informal social networking websites such as Facebook and Twitter for business processes especially marketing is being observed profoundly. Acquisition of customer trust is a vital requirement for business organizations and is necessary for presenting an organization’s image in a good light in front of customers (Borgatti, Everett & Johnson, 2013).
The negligible information about the benefits of social networking could lead to insufficiencies in business strategies needed to cope with the dynamic environment today. Discussions on the application of social media should also be complemented with an illustration of the support of information and communications technology frameworks of organizations. The internet emerged as a drastic phenomenon in the domain of strategic performance of businesses thereby reflecting the requirement for business organizations to revise their operational frameworks and adapt to the digital economy (Burt, Kilduff & Tasselli, 2013). The recession of 2009 was followed by an upheaval of internet technology and its applications in commerce and marketing which led to improvisation in global markets. Therefore business organizations had to leverage the opportunities accessible through introducing changes in business models.
Organizational changes that were observed specifically in the domains of technology, legislation, internal and external factors of an organization, and market developments formed the generic business scenario in the present (Chu & Du, 2013). The promising suggestions of the innovative economic theory towards the influence of a knowledge-based economy in global economic growth create concerns for priority to asset management.
The theory also suggests that economic growth in the innovative economy is observed in the realization of integrating knowledge in the formulation of products and services alongside prolific characteristic opportunities for R&D-based entrepreneurs (Daly, et al., 2014). Other advantages that could be drawn from the excerpts of innovative economy reflect on the networking among organizations in similar industries alongside improvement of collaboration between companies leading to clustering and partnership among organizations based on human capital.
The positive impact of social networking:
Generic advantages of social networking for the strategic performance of business organizations include the proliferation and communication of engaging and relevant content that can promote brand visibility alongside the acquisition of the attention of potential customers. The response rate of organizations to industry developments increases with the application of social media since the management is aware of the industrial developments. The promotional content and activities utilized for marketing operations of business enterprises could become cost-effective with the use of social networking resources (Eriksson & Kovalainen, 2015).
The competencies of the organizations to deliver appropriate customer support and feedback acquisition services alongside the opportunities for developing new channels for customer interaction are accounted as promising elements of social networking. The options of instant messaging options in the majority of social networking platforms allow opportunities for real-time information sharing. Real-time information sharing can be explicitly realized in the context of intra-organizational communication thereby indicating the opportunities for managers to organize team meetings, interact with prospective clients, and organization of conferences alongside providing appropriate evidence that could relate to the accomplishment of strategic objectives. Social networking enables organizations to obtain a comprehensive advantage in the context of the immediacy of issues (Hinz, Schulze & Takac, 2014).
The references to a knowledge-based economy are profoundly observed in the case of the increasing participation of customers on social networks and the influence of content on the prospects of commerce. Therefore, social networks offer cognizable opportunities for marketers to increase proximity with customers and provide empowerment to customers. Critical reflection on the applications of social networking refers to the flexibility acquired by organizations in terms of obtaining comprehensive feedback from customers rather than generalized data accessible from market research reports (Hohenthal, Johanson & Johanson, 2014).
In the context of business performance, organizational management also requires to emphasize the advantages of social networking for intra-organizational benefits. Social networking among employees enables the establishment of favorable interrelationships between employees. The personal interaction among employees on social networks can be utilized as viable data by organizational management for the formation of teams and the assignment of tasks based on shared interests and common objectives (Nielsen & Schrøder, 2014). The association of employees with the official channels of the organization on various social media platforms can be evaluated by the senior managerial personnel as a measure of employee engagement. Hence these positive impacts of social networks on business performance can be profoundly observed in the various research outcomes about the effect of social networking in industries.
Negative implications of social networking:
Social networking’s application in the context of strategic business performance especially in the case of validating the recruitment and selection process can be accounted as a disadvantage of social networking. Employment laws facilitate adequate opportunities for organizational managers to review the personal information of potential candidates through their profiles on social media platforms.
The prominent examples of individual profiles on LinkedIn which are evaluated by various HR managers before the analysis and selection of candidates are regulated by different legislations in varying jurisdictions. The perception of employees’ social media profiles alongside their activity on social networking sites is prone to be subjected to the monitoring and supervision of senior management which can have a detrimental impact on the integrity and privacy of the audience. Business performance can be strategically hampered through the concerns for data leakage through social networking channels which are becoming highly characterized by pitfalls such as identity theft and fraud (Rennie & Morrison, 2013).
Therefore internal information of organizations becomes vulnerable through extensive and unsupervised use of social networks by employees. The use of social networking within the organization could also expose the personal data of employees to concerns of physical attacks such as data breaches (Shapiro & Margolin, 2014).
On the external front, social media is accountable for negative implications for a business reflecting on the implications of backlash as well as probabilities for the establishment of a negative brand image. Organizations also face legal setbacks for the implementation of social networking in advertising thereby drawing legible references from content rights and intellectual property rights.
The scope of the literature review was directed along the identification of positive and negative impacts of social networking on strategic business performance. The specific illustration of social networking with definition and the observation of social networking’s supporting elements such as internal information and communication technology framework of the organization. The outcomes and perceived insights that could be derived from the initiative could be variably implemented in various business enterprises vested in the private domain reflecting on the specialization of the organization.
The objectives of implementing a literature review were directed toward the acquisition of an integrated opinion of the dynamic aspects of social networking in the context of business performance. The references to theoretical perspectives such as the innovative economic theory also indicated prominently the variable pitfalls as well possible recommendations that can influence the precedents for management framework to leverage on competencies of social networking to improve the profitability and growth of business in the long term.
Comparative analysis of academic publications and peer-reviewed journals could facilitate the research with an insight into the significant concerns that can be developed during the study. The comparative analysis also facilitates a distinct impression of the themes which could help reflect on the overall growth of a business through the implementation of social networking.
Emphasis on the positive and negative impacts of social networking on business can be observed as a prolific theme identified in the research activity. The positive impacts of social networking are largely vested in the relationship privileges that can be acquired by organizations with customers whereas the negative impacts were noticed in ethical, privacy, and legal concerns. The use of the positive impacts of social networking could be improvised further by referring to the application of social media for real-time information-sharing objectives that improve internal communication (Rennie & Morrison, 2013).
The literature review also reflects on the negative implications of social networking referring to the vague nature of ethical and legal obligations of social media. The determination of particular approaches to tailor marketing and strategic management by organizations according to the evolving market scenario could be accounted as a prominent theme identified in the research. Particular references to the enhancement of business prospects on the grounds of support that can be acquired from the ICT systems can also be estimated as a different theme of the research activity (Shapiro & Margolin, 2014).
The efficacy of specific social networking platforms concerning the performance of business organizations reflects on the necessity of introducing custom social networking platforms for business organizations that can facilitate cognizable routes for improvement in the strategic performance of business. The positive growth depicted by distinct parameters and qualitative indicators suggests that a positive growth rate in business performance can be accomplished through the performance-oriented application of social media.
The sources of literature could always be assumed as the primary determinants of quality and relevancy of research outcomes since the critical reflection provides a legible impression of the concerned dimensions of the literature review that have to be assessed. Furthermore, the application of literature sources in accomplishing purposive insights into social networking and its applications in business performance would have to be based on the authenticity of available literature (Rennie & Morrison, 2013).
The quality of the papers that were identified to realize the literature review referred to the application of different peer-reviewed journals that were accessible through online mediums. The publications and research journals that have been selected for this research are reflective of references to particular products, business niches, and specific countries. The quality of the outcomes obtained from the research suggests the evaluation of each journal from an independent perspective of each individual without hampering the credibility of the opinion.
The identified papers for the study have been realized in recent years depicting the evolution of information and communication technologies alongside implying plausible references to the proliferation of social media as a functional tool in business performance.
The validity and reliability of the sources of literature identified in the research are ensured based on citations and reviews of experts in business management and technological advancement. The formulated hypothesis and the proposed strategic directions have been identified with practical applications in various industries.
The profound research gap that could be observed in the case of this study was the reflection of the literature on the positive impacts of social networking which was largely emphasized. On the contrary, discussion of alternatives as well as the possible implications of cost and financial growth in the long runs of the enterprise (Shapiro & Margolin, 2014).
The literature fails to depict considerable references to the interrelationship between the application of social networking and other influential factors such as demographic and social elements which are major determinants of customer behavior on social media.
The literature review presented a conclusive interpretation of the literature about the advantages and possible detriments that can be associated with social networking and its business implications. The references to innovative economic theory in the review suggest the necessity for the transformation of economy-based strategic business approaches to human capital-based approaches.
Arregle, J.L., Batjargal, B., Hitt, M.A., Webb, J.W., Miller, T. and Tsui, A.S., 2015. Family ties in entrepreneurs’ social networks and new venture growth. Entrepreneurship Theory and Practice, 39(2), pp.313-344.
Batjargal, B., Hitt, M.A., Tsui, A.S., Arregle, J.L., Webb, J.W. and Miller, T.L., 2013. Institutional polycentrism, entrepreneurs’ social networks, and new venture growth. Academy of Management Journal, 56(4), pp.1024-1049.
Borgatti, S.P., Everett, M.G. and Johnson, J.C., 2013. Analyzing social networks. SAGE Publications Limited.
Burt, R.S., Kilduff, M. and Tasselli, S., 2013. Social network analysis: Foundations and frontiers on advantage. Annual review of psychology, 64, pp.527-547.
Chu, S.K.W. and Du, H.S., 2013. Social networking tools for academic libraries. Journal of librarianship and information science, 45(1), pp.64-75.
Daly, A.J., Liou, Y.H., Tran, N.A., Cornelissen, F. and Park, V., 2014. The rise of neurotics: Social networks, leadership, and efficacy in district reform. Educational Administration Quarterly, 50(2), pp.233-278.
Eriksson, P. and Kovalainen, A., 2015. Qualitative Methods in Business Research: A Practical Guide to Social Research. Sage.
Hinz, O., Schulze, C. and Takac, C., 2014. New product adoption in social networks: Why direction matters. Journal of Business Research, 67(1), pp.2836-2844.
Hohenthal, J., Johanson, J. and Johanson, M., 2014. Network knowledge and business-relationship value in the foreign market. International Business Review, 23(1), pp.4-19.
Nielsen, R.K. and Schrøder, K.C., 2014. The relative importance of social media for accessing, finding, and engaging with news: an eight-country cross-media comparison. Digital journalism, 2(4), pp.472-489.
Rennie, F. and Morrison, T., 2013. E-learning and social networking handbook: Resources for higher education. Routledge.
Shapiro, L.A.S. and Margolin, G., 2014. Growing up wired: Social networking sites and adolescent psychosocial development. Clinical child and family psychology review, 17(1), pp.1-18.Order Now