Richard Branson Management Analysis

Richard Branson Management Analysis Virgin is a company established in 1970 by Richard Branson as a mail order company for sale of records. The company name Virgin was suggested by an associate of Mr Branson and was adopted as proclaiming their commercial innocence, while possessing some novelty and modest shock-value (Grant, 2010:808). Over the years, the company has grown rapidly and became a leading branded venture which diversified into other businesses. Today, Virgin is widely recognised and has become one of the most respected brands owing to successfully grown businesses in areas such as the airline industry, telecom, financial services, music etc. So far, the company has more than 200 individual companies or ventures which are owned and controlled by 20 holding companies that operate under one umbrella Virgin. Most of these companies own assets, employ people, offer goods and services (Grant, 2010:816). Even though all Virgin companies and ventures are separate entities, each is empowered to run its own affair s. They share common resources and capabilities that link them. Grant (2010) noted that the principal commonalities between this diverse range of enterprises are, the Virgin brand, and the role of Richard Branson as their instigator and major investor which is discussed below. Resources and capabilities defined by Grant (2010) are productive assets owned by a company and what the company can do. Resources are not productive in themselves they need to be converted into capabilities by being managed and co-ordinated (openlearn.open.ac.uk). For a company to gain competitive advantage, the company requires to focus on key strengths in resources and capabilities and ensure both work together instead of in isolation. In the case of the Virgin Group, one major resource is its founder Branson, who founded the company in 1970. His strong leadership is vital to developing new capabilities for Virgin. As noted by Grant (2010), his strength as a businessman was in conceiving and implementing new business ideas. Richard Branson is not only the founder, he is also an instigator and major investor in the company. His enthusiasm and devotion for business led him to establish a series of other Virgin companies such as Virgin Records, Virgin Airline, Virgin Rail, Virgin C ola etc. He is famous worldwide, his leadership of the Virgin Group extended beyond his role as a source of entrepreneurial ideas. As creator of Virgin and its unique corporate culture, and the primary promoter of its image and entrepreneurial spirit, Branson was synonymous with Virgin (Grant, 2010:814). He does not believe in corporate culture and bureaucracy, he prefers to do things differently by transition from rule Britainnia to cool Britainnia. Informality and disrespect for convention were central to Bransons way of business (Grant, 2010:814). Over the years, Branson has become more of strategic and charismatic leader of the Virgin Group instead of mere hand-on manager and his business vision has been a driving force for the success of Virgin. Another link is the Virgin Brand. Brand names and other trademarks are a form of reputational asset, their value is in the confidence they instill in customers (Grant, 2010:128). Grant (2010), described it as the Virgin groups most valuable asset. He noted that the values and characteristics that the Virgin brand communicated are inseparable from Branson the entrepreneur. The Virgin brand was also identified with innovation and unconventional strategies and marketing that characterised most Virgin start-ups (Grant, 2010:813). With the brand, the group was able to create other companies representing quality of services and value for money. It enabled them to create a range of products and services over other markets. Even though a brand name is an intangible asset, the value to organisational growth and competitive advantage sometimes can be immeasurable. The success of a firm to build a strong consumer brands have a powerful incentive to diversify which the Virgin group have succeede d in doing (Grant, 2010:130). The Virgin brand allowed the group to diversify to unlikely business areas in countries around the world like the US, Australia, Singapore, Japan, Hong Kong etc. The success of Virgin can also be traced to its organisational structure and culture. Organisational culture as identified by Jay Barney and cited by Grant (2010) is a firm resources of great strategic importance that is potentially very valuable which relates to its values, traditions and social norms. Virgins ability to operate effectively with so little formal structure or management systems owes much to the groups organisational culture as defined by Bransons own values and management style (Grant, 2010:818). He draws inspirations from the ideas of others and encouraged submission of new business ideas to its corporate offices. Employees are encouraged to develop business ideas for new businesses. Grant (2010) pointed out that the idea of Virgin Bride was actually from a Virgin Atlantic employee appalled of products and services offered by bridal stores in the UK. Employees have stakes in the group and strive to make the company succeed, allowing them to manage and control the co mpany and also to enjoy the benefits of their success. In 1993, Branson summed up Virgins relationship with employees as staff first, then customers and shareholders. Virgins capability is in using employees competence and commitments in achieving organisational goals which can only happen where there is an open workplace structure and culture. Virgin has done well in the establishment and management of new businesses over the years, but some of its businesses are no longer what they used to be considering the current the world economic downturn. Virgin must look inward and see some of its ventures that are no longer economically viable and consider divestment. A few of them should be considered like Virgin airline, Virgin money, Virgin cola etc. Virgin dominated the airline industry due to its management style and offering customers value for money, but this came at a price. The airline industry is capital intensive. As a matter of fact, in 1992 Branson sold his most profitable and successful business, Virgin Music for  £560 million to fund Virgin Atlantic (Grant 2010:809). Even though the airline still makes profit but it is not as profitable as it used to a decade ago. People no longer travel as much, and competition in the entire travel industry is rife. Nowadays, airlines are always trying to win customers over by of fering low prices and unique packages, compounded with substitutes to air travel etc. There are other factors affecting the profitability of air travel such as government regulations and deregulations, high jet fuel price, taxes etc. Considering all these, it will be best for Branson and the Virgin group to divest Virgin Airline. Branson is always known as trying to stick it the big boys, but his involvement in financial activities seems to be a business that should be left to the big boys by divesting and concentrating on other areas. Customers will prefer products and services from institutions with a long history and good track record such as banks and other financial institutions. With more established players in the field, his involvement is a little tricky. Virgin is not a bank and does not have all the infrastructures to ensure full banking activities, and as a result its effort to bid for 318 RBS branches in England and Wales failed, and was ran over by Spanish banking giant Santander, a clear indication for Virgin to divest Virgin money. Virgin cola, another of Richard Bransons effort to stick it to the big boys should also consider divestment. It is a known fact that brands fail when they move into unknown territories. Even though, Virgin cola might be cheaper than the likes of Coca-Cola and Pepsi, these are two giant coke makers known worldwide. It will be hard, if not impossible for Virgin Cola to make an impact competitively in the world market. Coke and Pepsi take competition seriously and will not fold arms while Virgin Cola try to unseat them. It is believed that strong brands exploit competitors weaknesses. Though Virgin is a strong brand, but its Virgin Cola is not a strong brand when compared to Coca-Cola and Pepsi. By 1997, Virgin Cola was losing  £5 million on revenues of  £30 million (Grant, 2010:813). Still trying to take on the big boys will come at a detrimental costs to Virgin. So, it will be wise to also divest Virgin Cola. As a result of diversification, a firm can expand its range of products and services and sell to existing customers or create new markets in different parts of the world thereby increasing value and growth. Grant (2010), described it as risk reduction strategy that enables shareholders spread risks. He noted that the focus of diversification analysis has been to identify the circumstances in which multi-business activity can create value (Grant, 2010:406). To determine if diversification will create shareholder value, Grant advised to apply Porters essential tests the attractiveness test, the cost of entry test and the better off test, Grant (2010:408). He explained that without diversification, firms are practically prisoners in their own industry. Branson successfully built companies from ground-up but strategic alliance with firms with the resources and capabilities might be beneficial. Alliance is something Branson knows well. In 2007, he negotiated an alliance with an Indian co mpany Tata to establish Indian Virgin mobile. Branson should do the same by diversifying into road construction in developing countries like Nigeria. An alliance with an already established company in Nigeria with the resources and capabilities such as Chinas Shanghai Shibang Machinery company (SBM) will be ideal. SBM provides construction companies with large amounts of stone crushers, sand making machines and industry grinding machines. Virgin has economies of scope as a result of tangible and intangible resources due to its brand name, this can be exploited to increase value through licensing or franchising. Virgins operating styles have been designed by Branson. Things have changed, Virgin should adjust its financial structure. Branson should consider looking within the group and consolidate or divest companies that are not performing well. Grant (2010) noted that to obtain the tax relief from Virgins loss-making firms, there are clear advantages to consolidation. Branson argued that Virgin companies operate on a standalone basis but consolidation of some in similar businesses such as Virgin Atlantic, Virgin Blue and Virgin Express, Virgin Retail and Victory Corporation will create more financial stability. This will also cut down the overhead of conducting multi businesses and offer customers more diversified service range. Virgin is a successful brand of small companies that run independently, its organisational structure has been as styled by Branson. The structure has worked to an extent but Virgin should allow its brand name to be used by other small good companies through franchise and collect royalties. Grant (2010), described the Virgin brand as its most valuable asset. The benefit of franchising the brand means Virgin can reduce risk, provide the much needed cash that it requires to run other profitable businesses, watch the business grow with minimal involvement, freely expand to other businesses and enter new markets in new countries. Franchisees are very important source of new  market offerings  and product concepts. Many companies have done well through franchise such as McDonalds, Trump hotels etc. The management structure of Virgin has been centred on one man, Branson and operated with little formal structure or management systems, this will not last forever. An organisation as big and diverse as Virgin should have a top-bottom management system instead of decisions being made by Branson and a few close pals. It is important that a well detailed management structure is in place instead of no-building, no-headquarters type of management he operates. The system may have worked under Branson does not mean it will work after him. Virgin is not a one-man business, it is a multi-national corporation and if Branson was to become less active as chief entrepreneur, public relations director and strategic architect without a defined management structure in place, who or what would take his place (Grant, 2010:822)? A centralised and systematic way of managing the future without Branson is what Virgin needs like Apple Inc.

Forecast Appendix

Opportunity Nowadays lifestyle is fast, whatever children, working period and everyone have not enough time to take care of their health, at the same time, and most of people are interested taking care of their health by used the supplementary product (pill or brew-drink). Moreover health is nowadays significant to several individuals. Because of this, supplementary food merchandises are widely traded. On the other hand in hurriedly time BASE (Beauty, Strong and Easy (Consume)) supplementary product is the new and different way for everyone.BASE supplementary product can be convenient easy, because the supplementary product in type of candy is can save the time no matter when working or car driving, on the other hand the candy supplement product does not need any water to devour. Unfortunately, not everyone is in a position to get all of the nutrients they need from their food. Here are three reasons why some people use dietary supplements instead: 1 . Physical stress decreases the b ody's ability to absorb nutrients from food. Have you ever been so tense before a school exam that you threw up or otherwise felt sick?If you have, then you know firsthand that stress can disrupt your digestive system. Many people work in stressful environments that produce physical stress (e. G. , construction workers), emotional stress (e. G. , counselors), and mental stress (e. G. , accountants and lawyers). In these environments, people's bodies may experience reduced efficiency at extracting nutrients from food. Consequently, people often have to use dietary supplements to keep their bodies healthy. 2. Dietary supplements can compensate for poor cooking.Many people are busy enough that they have to (a) eat fast food or (b) cook quickly for themselves. In either case, the food consumed by such people might simply lack the necessary nutrients for a healthy human being. It is a no-brainier, therefore, for people to use dietary supplements. 3. Unusual health requirements force some people to take dietary supplements. With the help of a doctor, some people (e. G. , pregnant mothers and drug addicts) determine that they need additional nutrients in their diet in order to remain healthy.While these needs can be temporary, they can also be permanent, requiring people to use supplements throughout their lives. Normal, healthy people can get all the nutrients they need from the food they eat. Unfortunately, not everyone is as healthy as they would like to be. For the reasons discussed above, many people need to take dietary supplements. Obviously, this should be done under the guidance of a competent physician. Market Target The target market of the BASE supplement can be anybody who needs vitamins to consume.Because many entrepreneurs see that the target market group really has high purchasing power to purchase the product and base on their common need. Consequently, this target market group really concern about their health and beauty, skin and body shape. In add ition, a certain groups at risk of deficiencies should use supplements can divided as following below All pregnant and breastfeeding women should take vitamin D supplements women trying to conceive and women in the first educe their child's risk of neural tube defects such as spine biffed. ? People aged 65 and over should take vitamin D supplements People with darker skin and people who are not exposed too much sun should take vitamin D supplements All children aged six months to five years should be given a supplement containing vitamins A, C and D Figure 1 – Vitamins needs Diagram Product and Service Design SF is a method for developing a design quality aimed at satisfying the consumer and then translating the consumer's demand into design targets and major quality assurance points to be used throughout the production phase.Our group will take the random population to find out the voice of customer for the Candy Supplement product, by use the interview method and questionna ire method to collect the data. As a result, the voice of customer for the BASE Supplement product is different because the need of customer is base on their personal need. We can identify as below table: Figure 2 – Personal need Diagram Product Layout The top of BASE Candy Box BASE candy 3. 2 g. Egg. 2 CM Inside of Package included 30 seeds of 12 CM.Front Cover of the Packaging of BASE Candy Supplement Figure 3 – Product and Packaging Design Marketing Program Product Strategy Product Line- BASE candy supplement is available in 3 kind of flavor. The three are (1) Candy created for people who are use for support other remainder on the body of people. Consequently, the BASE candy included many benefit such as -Good Health -White Skin -Fresh -Burn Calorie Packaging- the BASE Candy packaging made from cardboard paper.Price Strategy the BASE (Beauty, Strong, Easy (consume)) price is 490 baht per 30 seed. That price has a little bit high cost, because if the company set the price more than 500 baht as a exult, the customer will change their mind and change to buy other product. Promotion Strategy actually we have two promotions, key promotions are member promotion and buying promotion. Member Promotion – The customer should register and pay annual fee for BASE Supplement's company member card in order to get discount 5 % of products. The loyal customer of BASE Supplement's company will get discount 10 % of products. Buying Promotion -Promotion per monthly and per year -Customer buying two box set of product, the company will give discount coupons for using the next time (depends on company's policy) Place (Distribution) Strategy -The BASE supplement product will was distributed in Drug store, and sale in malls around Thailand. – The BASE supplement product distributed on company's website. The BASE supplement product will launch by social network such as Backbone, Mainstream, and Twitter. It is more convenient to customer that they cannot go to buy the product at drug store or far. They choose goods and payment such as credit card, application on mobile etc. Moreover the website have pictures and clips of The BASE Supplement in order to customer determine and confident in supplementary food. Then the company will send parcel post to the buyer's address.SOOT Analysis in the company Strengths: * It's the herbal candy to eat without water * It's durable and beautiful packaging format * It can use in every generations * Low sugar * Many benefits * Easy to buy * Can keep a long time Weakness: * Diversity of competitors * Expensive for child * No advertising reach consumers * Health concern trend * Weight control trend * Popularity * High quality * Growth economic * Government support about health care Threats: * Some materials hard to find * Is a business that high investment Product Process Misunderstanding's formula (no color added.Free of preservatives)' There are several types of herbs. Can use as needed such as Okra , chrysanthemum, licorice, ginger, lemon, orange, coca, panda, Stateliness, berry, cherry, quince, etc.. Candy and good quality be directly produced from herbs. Without the use of synthetic fragrances and colors. This may be harmful to consumers. How to prepare the herbs. Each type uses a different method to get out. Here are split into 2 groups. First Grouchiest use dry flowers and fruits. The group spent part of the trunk, such as okra, liquorices, chrysanthemum, ginger etc. Principles used herbal preparations.Boiled it slowly may be used 1 part herbs immigrated 1 part boil gently until get water, test, smell, color, and other properties of the herbs tried stew to the most concentrated. Concentrated herbs that can be used to produce candies herbs taste. Need to do day to day. Because herbal concentrates stored for up to one day, if not lose them. If you need to keep them long times may be frozen in the refrigerator. Herbal that we get should be filtered to clean sludge and sedimen t. Second Groups which use water form fruit such as Citrus, Orangeades group to reserve the natural quality of the nutrients and vitamins in it.Can not to boil it. Candy production process 1 . Boiled water to boil, Then immediately reduce the heat to slowly pour the sugar into the melted slowly stir the fire is now very weak. If a gas flame to fade to a minimum. If the electric power to almost boiling temperature is to use the heat to very low. If you use high heat to burn sugar. 2. Later sugar melts. Glucose syrup is added to stirring gently until well combined. Final concentration was added to the herbs. Beat together well when it is put into the water at first to be almost completely evaporated.I think the water evaporates. Quickly pour this mixture into the mold immediately. Forms designed to remove them. Dry and hard candy to come out easily. Hard candies that will be long. Need to use chainsaws or saws to cut bread. Cut out the candy pieces are cut to size as needed. For multi ple years, the cans should be storage with the lid closed. Improving formulations If you want to cool with the addition of menthol to about 0. 1-1% along with the herbs. Cooling effects of menthol taste is a bit transparent. Elf the concentration of flavors. Citric acid may be added to the 0. %.

Knowledge and Organizational Learning Essay

The emerging importance of social media was not one that has taken the corporate world by surprise. By empowering people with the sensibility that their voice matters and can make a difference, social media technologies have altered forever how people communicate and the way companies conduct their business. The success of Web 2. 0 lies primarily in the network effects which creates a sense of community. With the implementation of effective social media strategies, many global brands have won the hearts of their customers simply through staying connected and relevant. As such, this essay will explore how social media when managed strategically in an organisation, can be used to improve its ability to share knowledge across space and time, support innovation, aid problem solving and build social capital. Some case studies of organisations excelling through their social media platform will be discussed and evaluated. It must be noted however, that social media in all of its glory can act as a double edged sword when it is not used appropriately. Improving knowledge sharing Knowledge could be defined as ‘actionable information’ that allows one to make a more informed decision and provide an effective input to conversations and innovation at organisation levels (Jashapara, 2011). It enables one to act more effectively and aid in the ability to better predict future outcomes. A major challenge in organisations today is fostering a knowledge sharing culture. Whereby explicit knowledge is somewhat easy to codify and stored, the sharing of tacit knowledge remains rather equivocal. Through communities of practice which connects people through shared mutual interest and expertise in a specific discipline, organisations are now able to foster the kind of knowledge sharing culture they aspire (Burk, 1999). These social and professional networks create a virtual platform for employees to share relevant experiences and best practices, as well as identify knowledge gaps in their learning. As the ‘bite-size’ information is now readily accessible, learning and knowledge sharing becomes more convenient and easily assimilated. Yammer, an enterprise social networking tool is used by over 200,000 companies and more than 80% of Fortune 500 companies for internal communications and knowledge sharing (Customer Success). Launched in 2008, it drew inspiration from Facebook and Twitter where it features social networking as well as mircroblogging with a secure and private network. Designed for company collaboration, file sharing and exchange of knowledge and information with other users within their organisation or pre-designated groups, Yammer has successfully removed geographical barriers and creates immense knowledge sharing opportunities. It is imperative to note that there are two internal cultural forces that impacts learning and effectiveness in organisations (Jashapara, 2011). In an organisation culture with strong forces of cooperation, it is an ideological organisation where employees are more inclined to share knowledge and expertise. Conversely, if the forces of competition are dominant, it may create silos mentality whereby there is unwillingness to share knowledge in order to gain a competitive advantage (Holst & Fields, 2010). Despite having the various technologies in place for knowledge sharing, there must be interpersonal trust between employees in order to facilitate the exchange of knowledge (Lucas, 2005). Affect-based trust which is built on mutual care and concern between employees is a predominant factor as to one’s willingness to share tacit organisation knowledge. It is found that individuals who were friends were more inclined to share personal and tacit knowledge with one another (Epsein, 2000). The tacit knowledge transfer is characterized by interpersonal relationship as well as long-standing working relationship which will motivate an individual to act in ways that benefit the other (Smedlund, 2008). Hence, with trust and a culture to share, the silo mentality of an organisation will be diminished and they will reap the benefits of knowledge sharing. Supporting innovation Innovation is the ongoing process of discovering new products for the customers or improving work process and efficiencies (Jashapara, 2011). It is no longer a question whether an organisation should pursue innovation but rather, it is a prerequisite for achieving a competitive advantage and success in many industries today. Innovation spurs motivation and efficiency within an organisation and though effective innovation management, it can increase market share through existing markets and capture new markets as well (Potecea & Cebuc, 2010). Customer experience will be enhanced with improved product quality and with wide range of choices made available to them. Innovation prevails in organisations with flexible and adaptive structure, a culture of trust and knowledge sharing and led by a committed management team who are motivated to promote organisation learning (Dasgupta & Gupta, 2009). Through the use of effective social media strategies, an organisation now has more platforms share ideas, gather feedback and innovate on product offerings and customer experience. One prime example is Starbucks’ own version of a social network portal, ‘My Starbucks Idea’ where it is an avenue for customer to share their own Starbucks related ideas (My Starbucks Idea). Inaugurated in 2008, it leverages on desire for engagement and interaction in social network by giving users the ability to share and vote for ideas and check on the outcomes of their suggestions. Through this platform, Starbucks is able to hear directly from their customers and act upon the ideas thereby cultivating and creating great consumer value and community. My Starbucks Idea’ is complemented with Starbucks Blog, ‘Ideas in Action’ which features contributions by various Starbucks employees who shares on the implementation of the ideas given by users through the ‘My Starbucks Idea’ site (Ideas In Action). Ultimately, through the use of social media, Starbucks is clearly prioritising their communication with customers and this creates an e ven greater sense of loyalty to know that their ideas are valued and implemented. It gives customers the empowerment to be involved in part of the decision making process and the ability to shape the future of Starbucks. Aid problem solving The emergence of problem-finding and problem-solving approach highlights the importance of identifying problems to solve, seizing opportunities and overcoming the challenges in organisations (Nickerson, Yen, & Mahoney, 2012). Through the multiple channels of social media, organisations can now connect with customers and hear first hand of their experiences and address problems instantaneously. A good example of an organisation leveraging on social media to aid problem solving is Best Buy, the world’s largest consumer electronics retailer (About Best Buy). Through the years, they have provided customers with exceptional choice, unbiased advice and trusted support for their technology needs. Galvanised by the influence and power of social media, Best Buy created a feed on Twitter called Twelpforce to provide solutions for customers (Dunn, 2010). Those who are having technical problems are able to post it on Twelpforce and a team of Best Buy associates or other Twitter users can post solutions or suggestions. By monitoring the feeds, Best Buy’s management are able to hear unbiased customers’ feedback on their products and assist them in real time. Twelpforce also presents the opportunity for new sales as individual choices are largely influenced and made on the recommendations and advocacy of others (Cunningham, 2012). Electronic word of mouth is especially powerful as the people in an individual’s social network are usually deemed as a trustworthy source of information (Curran, O’Brien, & O’Hara, 2011). Through Twitter and other social media platforms, Best Buy demonstrates their commitment to rejuvenate and refine their customer experience, and at the same time, drives value and innovation to create a more positive and connecting world. Building Social Capital Social capital refers to the active connections and network of relationships between people: the trust, mutual understanding and shared values which binds them together and facilitate coordination and cooperation for mutual benefit (Cohen & Prusak, 2002). It is the glue that promotes knowledge exchange and innovation hence, an essential strategy for organisations to gain competitive advantage in the markets which they operate. However, the development of social capital does not relegate the importance of investing in human capital in organisations (Cummingham, 2002). Huppi and Seemann (2001) phrased it appropriately that â€Å"human capital resides in the people; social capital resides in the relationships among them†. Using social media, organisations can connect with each other more readily and establish a network of community and relationships without any geographical boundaries. This is exemplified by Accenture, a global consulting and technology services and outsourcing company with circa 259,000 employees (About Accenture). They have created a Knowledge Exchange that is integrated with thousands of communities of practice which enables geographically and spatially dispersed employees to share ideas and collaborate more effectively. Residing on a Microsoft SharePoint platform, it features a wide social network with â€Å"people profiles† with biographies, photos and resumes as well as individual’s interests and skill sets. The Exchange also contains blogs, wikis, market insights and e-learning where sharing ideas and knowledge is evident and encouraged. Through The Exchange, company research revealed positively that there was a 42 percent increase in employees’ engagement and collaboration activities. Top collaborators are recognised with â€Å"celebrating performance points† and rewarded with badges that appear on their people profiles (Zielinski, 2012). Risks of Social Media With the many positive benefits of using social media in organisations, there are inherent risks involved when it is not managed effectively. One risk organisations face on social media platforms is the sharing of information. While it is a good medium for employees to share knowledge and ideas, it could be misused when confidential information and intellectual property are leaked. Most employees are aware of the implications of responding unthinkingly to emails however, the same degree of care and forethought are not always applied to social media sites. Thus, there is a danger that an individual may divulge confidential information mindlessly without realising that it is cast in stone and stored online indefinitely (Everett, 2010). While the decision to post videos, photos, thoughts and experiences on social networking site is entirely personal and â€Å"private†, a single act can spark a fire and create far reaching unimaginable consequences for an individual as well as organisations. A passing comment could end up being misinterpreted and a thoughtless prank filmed could easily go viral online affecting the reputation and profits of a company. An infamous example is the Domino’s Pizza debacle in 2009 whereby two Domino’s employees posted unappetizing videos on YouTube. The gross act of tampering with food damaged the company’s reputation severely and cut into nationwide profits. The only saving grace in this debacle is the company CEO, Patrick Doyle who posted another video in response and gave a well-worded apology and took full responsibility. Apart from the risks involving employee’s improper use of social media, social media presents an opportunity for disgruntled customers and competitors to assail a company’s reputation and start a public relations crisis. Instead of a traditional complaint email viewed only internally, unhappiness about a particular product or service standards can be viewed by potentially everyone in the world through social media. This is aggravated by the sharing functions on social media sites like Facebook whereby one may share another person’s unpleasant experience with their ocial contacts even though it may not have affected him. ‘United Breaks Guitars’, a YouTube video created by Dave Carroll in July 2009 is an example of how a customer can use social media to voice his unhappiness. In the song he blamed United Airlines for breaking the neck of his $3,500 guitar, caused by careless baggage handling and unreasonable policies. As the claim did not occur within the standard 24-hour time frame, it was deemed ineligible. 50,000 views were generated just within 1 day and it grew to 8 million by March 2010. It currently has more than 12 million views with popular shows like ‘The Checkout’ on ABC featuring it. Even though United Airlines did finally offered a $3,000 compensation for the damage made to his guitar, the damage done to the reputation and public relations of United Airlines is estimated to have cost them $180,000 within four days of the song been published. Another risk associated with social media is malware and account security. With most of the time spent on social networking sites, it makes their users ideal malware targets. Typical attacks take advantage on the trust relationships between users and their social contacts and try to trick users into giving up sensitive information which can be exploited for financial gain (Everett, 2010). By clicking on links sent by trusted friends, one might be susceptible to malware infection from drive-by downloads which steals information and might give attacker total access and control of the computer. This is especially disastrous for organisation whereby confidential information and trade secrets may be infringed. By not engaging in social media could be a risk in itself for organisations as nowadays most brands and companies are being discussed online. It is essential for an organisation to have a voice in these conversations, monitor and react timely to negative comments. With the risks involved, an organisation should develop a sound corporate policy on the usage of social media and educate employees of the role they play. The IT department needs to regularly update it security protection and firewall to mitigate any malware attacks or unsecure networks. Conclusion Social media presents a wonderful opportunity for organisations to leverage and share knowledge with each other despite geographical boundaries. With effective management, it promotes social capital where trust relationships can be built and creates a platform of engagement and collaboration. Social media platforms enable organisations to listen to the voices of customers and innovate and act upon the ideas given. By doing so, they gain customers’ loyalty and trust which is important to their success. Lastly, social media allows employees and customer to share their problems and receive suggestions and solutions by other users in real time. However, it is imperative to note that not all is good with social media as it can have disastrous impact on a company if it is not managed effectively. Social media does have a powerful amplifying effect. But just like any technology, it can be used for good or evil.