Social networking sites increase employee productivity

An interesting piece by David Quach on the ABC News site (Hat Tip @aussienick) about how more people should use Facebook to improve worker productivity. Here is the summary:

Well, while any adverse effect of Facebook on productivity is detrimental to the economy, economic theory also suggests that the economy could be improved if there were more users. In other words, as long as Facebook isn’t used at work too much, everyone would be better off if more people used it.

The basic idea is that each user of Facebook not only gains individual benefits from using the social networking site, but also provides (network) benefits to other people. And since people generally do not take into account the benefits to other people when deciding whether or not to join Facebook, there are fewer users than is ideal for society.

Allow me to explain.

In the language of economics, Facebook is said to exhibit network effects; it is a technology that becomes more valuable as more people use it (and the network gets larger), like mobile telephones or fax machines, for example.

The network effect is real and does increase productivity. But what really got me interested was the comments being left by readers which ranged from full support to a complete lack of support. The comments could be classified into four major themes:

  • What about your privacy
  • Facebook is the best thing
  • Facebook is a complete waste of time
  • People with real social lives don’t use Facebook

Here are a few.

Cricket:

27 Nov 2008 2:22:02pm

Concur. I take singular delight in not being registered on any of these social networking sites. People with REAL social lives don’t have the time to waste on them.

Jeremy:

28 Nov 2008 12:13:05am

Nobody forces you to post every detail of your life on facebook. If you consider it a public place and only post things you’d be happy posting in public then you have nothing to worry about.

Merlin 23:

27 Nov 2008 2:11:48pm

The statement “Concerns about Facebook’s negative effect on the economy – especially an economy on the verge of recession – were raised just recently when 13 Virgin Atlantic staff were sacked for criticising the airline online” is proposterous.

‘Facebook’ is an application and didn’t do anything – the people using it did. The same result would have occurred if they done the same thing using the any other form of media and their boss heard about it.

Di:

27 Nov 2008 3:25:12pm

We are all selfish for not joining face book! I can’t believe this guy wrote such an article! It is amazing the space that he took up saying so little.
I agree with the statements in the comments regarding fraud, identity theft, and invasion of privacy! It does happen and as much as it may be stated that its safe and ok, personally I won’t take the risk. I have plenty of ways to communicate with friends without reducing myself to that level. So go ahead – call me selfish!

From a business point of view Merlin 23 is correct Facebook/MySpace/etc is not the problem, management is. What would you do if someone was always late to work, spent too long at lunch or on a smoking break (do they still have them)? Same thing should be done if people are wasting time on Facebook.

Privacy is an issue but it needs to be managed. Jeremy is right, no one is forcing you to put all your details on the site, remember The Mother Test?

Cricket seems confused. While claiming to be a real person with a social life they seem to have the time to hang out commenting online ;-). Which brings me to my final point, usage of social media is growing in Australia and growing quickly.

In the 2007 Q1 Forrester Technographics Survey of Australian Adults online found 11% were Creators of content, 23% Critics on content, 5% Collectors of content, 14% Joiners to social networks, 38% Spectators reading what other said and 56% Inactives ignoring social media. 12 months on these figures had changed dramatically 2008 Q1 Forrester Technographics Survey showed:

  • 26% Creators
  • 35% Critics
  • 16% Collectors
  • 45% Joiners
  • 63% Spectators
  • 24% Inactives 

With this sort of growth David Quach will get his wish, but businesses out there who do not know how to manage employees within this new world will have a lot of trouble.

UPDATE: Minutes after hitting post I found a story from Financial Times blogs on time clock watching bosses discussing the “Japanese concept of ba: a hard-to-translate notion that, in this context, appears to describe an elevated state of knowledge-sharing between colleagues.”