00:00:01
we're here today with Lin Wu she's a
00:00:03
wharton professor of operations
00:00:04
information and decisions and she's
00:00:06
going to be talking to us about her
00:00:07
paper data analytic skills and the
00:00:10
corporate value of social media Lin
00:00:11
thanks for being here sure so first of
00:00:14
all could you give us a brief summary of
00:00:15
the research what were you trying to
00:00:17
study here sure absolutely so the
00:00:19
research is really need to understand
00:00:21
how firm derive value when they start
00:00:24
using social media and that's an
00:00:27
important question because according to
00:00:29
a reason CMO survey and only fifteen
00:00:32
percent of executives can quantitatively
00:00:37
say the impact of social media on their
00:00:40
bottom lines that means eighty-five
00:00:42
percent of them do not and all and the
00:00:44
forty five percent do not have any clue
00:00:46
both quantitatively or qualitatively
00:00:49
with the value of the social media is to
00:00:51
their business and that's even a bigger
00:00:54
problem as social media spending or is
00:00:57
projected to double within the next
00:00:59
three to five years so understanding how
00:01:02
firms derive value from social media is
00:01:04
becoming a really important question now
00:01:07
how did you examine this question and
00:01:09
what did you find yeah so what we did is
00:01:12
what we did is we collect a larger
00:01:15
simple the largest possible sample
00:01:17
because before social media study often
00:01:20
targets marketing related activities or
00:01:22
firms so here we just look in all the
00:01:24
firm who ever had a you know social
00:01:28
media presence in this case a Facebook
00:01:30
company page okay and then we map all
00:01:32
their stock market value into into our
00:01:37
model to look at whether when they adopt
00:01:39
or start using social media do their
00:01:42
market value increase or decrease or
00:01:44
stay the same and what we found is that
00:01:46
on average it is a positive relationship
00:01:49
but not when they adopt but when they
00:01:52
actually start using social media and
00:01:55
what's interesting is that the return
00:01:56
extremely heterogeneous as in some firm
00:02:00
derive a lot of great value from using
00:02:02
social media some don't and some even
00:02:04
have a negative impact after they
00:02:07
started using social media and that's
00:02:10
really interesting because we thought
00:02:11
well what is really driving that right
00:02:13
why do some firm do so well with
00:02:15
media and some don't and we're trying to
00:02:18
understand this from from a perspective
00:02:21
entire organization not just the
00:02:23
marketing department and we found is
00:02:25
that is really the data analytic skills
00:02:28
embody in their employees but ultimately
00:02:31
driving their return on social media now
00:02:34
when you say Dana other skills like how
00:02:36
does that can you explain a little bit
00:02:37
more about how that kind of keys into
00:02:39
social media like what is it that these
00:02:41
people with these skills are bringing to
00:02:43
the table that's helping companies
00:02:44
maximize value from social media
00:02:46
absolutely so here the data skill will
00:02:49
be measures really using the employee
00:02:50
resume so we called about like 15 50
00:02:53
million resumes across the United States
00:02:55
and then we look at their resume do they
00:02:57
have relevant data skills like theydo
00:02:59
mining skill data centric and analytic
00:03:01
skills and what we found is that this
00:03:04
data skills has cannot just be
00:03:06
concentrate on the marketing department
00:03:08
alone at first we thought oh maybe you
00:03:11
know since marketers are using advanced
00:03:13
analytics and maybe is really the value
00:03:15
came from there when we found exactly
00:03:17
the opposite that has really data skill
00:03:19
across entire spectrum of functions
00:03:23
within the firm that matters the most
00:03:25
now includes data skills in HR in
00:03:28
finance in operation in product
00:03:30
development in rd only when data skill
00:03:33
to stupid across all function aspect of
00:03:36
the firm can firm drive greater great
00:03:38
greater value and if you think about it
00:03:40
it makes sense because social media data
00:03:42
does not means only for marketers right
00:03:46
the data the consumer preferences
00:03:49
consumer sentiment and feedback can
00:03:51
really be applied broadly to every
00:03:54
aspect of firms operation right example
00:03:56
bizarra hey Zara is great at tapping
00:04:00
consumer preferences and they are you
00:04:03
know because they are taught there
00:04:04
because they track consumers preferences
00:04:07
over time there they are actually
00:04:09
introduced to introducing new products
00:04:12
every two weeks and so firms are turning
00:04:16
their biggest Facebook fans into
00:04:17
employees so that can be great for HR
00:04:20
functions as well so you think of the
00:04:21
wealth of social media data and it can
00:04:24
be really applied to every aspect for
00:04:26
evaporation and we
00:04:28
those winners function of within the
00:04:30
firm I finance HR and operation a
00:04:33
product and product development can make
00:04:35
sense of these data and turn those data
00:04:37
into strategies and that's when you see
00:04:39
the greatest value so it's really not
00:04:41
just about it seems like the
00:04:43
differentiating factor here is first of
00:04:45
all not just adoption but actually using
00:04:47
it but then not just actually using it
00:04:49
but knowing how to use it in a smart way
00:04:50
exactly exactly now we're their
00:04:53
conclusions that you found that we're
00:04:55
surprising to you absolutely um you know
00:04:58
at first we thought the positive
00:04:59
relationship without all you know some
00:05:01
firms just naturally fit to use social
00:05:03
media right if you're a consumer-facing
00:05:05
firm you have products and you are you
00:05:08
need to know what users are doing then
00:05:10
it makes sense so we thought most of
00:05:12
these will be concentrating the consumer
00:05:15
products it retails or in our high tech
00:05:20
but we found was that actually opposite
00:05:22
is really the non consumer-facing firms
00:05:24
that generates the most value and that
00:05:27
gets us thinking oh really maybe the
00:05:29
social media data is really impacting
00:05:32
every aspect of the firm's operation the
00:05:35
marketing outcome may be just tip of
00:05:37
iceberg and that's interesting and also
00:05:39
we thought marketing the apartment might
00:05:41
be the benefiting the most when they
00:05:43
have strong analytic skills again we did
00:05:46
not find that we really find the
00:05:48
concentration of data skill with in on
00:05:50
departments none marketing departments
00:05:52
but across all function of the firms
00:05:54
that ultimately drives the value so now
00:05:57
if I am if I'm a company any kind of
00:05:59
company and I'm looking at this research
00:06:01
what do you think that companies can
00:06:02
take from this in terms of being able to
00:06:04
actually apply it to their operations
00:06:06
absolutely I think this may not just
00:06:09
apply to social media per se but any
00:06:11
kinds of data centric decision-making
00:06:13
right so we have search data we have
00:06:15
clickstream data we have mobile data all
00:06:17
these data need some kind of sense
00:06:20
making so having theta and little skill
00:06:23
within the firm is becoming more
00:06:25
important than ever and you're not any
00:06:27
can't just hire raw number of them and
00:06:29
put them on RD or put them all in
00:06:31
marketing it's really they had to be
00:06:34
distributed decentralize across all
00:06:36
departments that's when you can actually
00:06:39
gave a dry the most been
00:06:40
this now what do you think are there
00:06:43
misperceptions I think you've talked
00:06:44
about a little bit other misperceptions
00:06:46
that you think this research dispels
00:06:47
like I think it really just goes to the
00:06:49
fact of it's so important to have people
00:06:50
to interpret your data or just to
00:06:52
interpret your data it was just having
00:06:54
data yeah absolutely so I think
00:06:57
translating data into strategies in
00:06:59
every aspect or operation is really is
00:07:01
the key and and it can have it could
00:07:05
potentially have effect on firm
00:07:07
hierarchies for example before you are
00:07:10
developing a product you may not
00:07:12
necessarily need to ask your boss for
00:07:13
permission you just go into the data
00:07:15
directly go to social media data other
00:07:17
type of data and say oh this is where it
00:07:20
makes sense to do to do this and you
00:07:21
just make that decision decision on your
00:07:23
own it also seems like it may be sort of
00:07:25
lends credence to the idea of maybe
00:07:27
incorporating a data layer in
00:07:29
departments or areas where maybe you
00:07:31
wouldn't normally think that you should
00:07:32
absolutely right fate and people
00:07:34
analytics HR analytics the big is a big
00:07:36
deal how do you use this data find your
00:07:39
nice employees it's something maybe its
00:07:41
most firm have not thought about that
00:07:43
what social media can do or you know may
00:07:46
using the next social media data to
00:07:48
generate the next next product
00:07:50
development or new product for for
00:07:52
consumers that may not be that may be
00:07:54
releasable as well now you said some of
00:07:57
the data that you found was that
00:07:58
actually social media in some cases
00:08:00
impacted companies negatively and I was
00:08:02
that companies that did not engage like
00:08:04
they just adopted or companies that had
00:08:06
didn't have as much data analytic skills
00:08:09
I mean what was the thing that kind of
00:08:10
made it a negative impact sure freezy
00:08:13
Apple if you just adopt and without
00:08:15
using it that's a negative effect but
00:08:17
the morning defense really came from you
00:08:18
spend a lot of time energy developing
00:08:21
social media platform and you don't
00:08:23
really have the capability to make sense
00:08:25
of data so you make all this upfront
00:08:27
investment else into social media but
00:08:30
you don't really get a maximum return as
00:08:32
a result you maybe have a negative ROI
00:08:34
from social media now what would you say
00:08:37
what do you think sets this research
00:08:38
apart from other analysis that's good
00:08:40
then connected on this topic absolutely
00:08:42
a thing I think what one important
00:08:44
factor is that we really look at all
00:08:46
firms across very industry manufacturing
00:08:49
and mining but not just consumer-facing
00:08:52
industries and so it's really a
00:08:53
very large comprehensive study on how
00:08:56
social media affects firm value and more
00:08:59
importantly we're not looking at the you
00:09:01
know the marketing outcomes or things
00:09:03
that we may be all of us know that for
00:09:05
social media could impact but other
00:09:07
things that sets a data skill and howl
00:09:10
if affect every aspect firm is not as
00:09:13
not something that we or the you know
00:09:15
the other pay are the research have
00:09:16
really delved into and how will you
00:09:19
follow up this research what's next oh I
00:09:21
think this is a really big emerging area
00:09:24
on data analytic skills so here we so
00:09:26
show the impact on social media I think
00:09:29
will be really interesting to see how
00:09:31
data skill can affect various various
00:09:33
other part operations such as innovation
00:09:35
activities what kind of innovation does
00:09:37
see the skill jet engenders is it going
00:09:39
to be incremental is it going to be
00:09:41
novel is gonna be a brand new innovation
00:09:43
that will change the world so that's
00:09:44
gonna be really interesting to see and
00:09:46
now do you think it does it lend
00:09:47
credence to the idea that maybe data
00:09:48
analytics is going to be one of those
00:09:50
just kind of basic level things that
00:09:51
everyone's going to be expected to have
00:09:52
at least some level of data analytic
00:09:54
skills I mean it seems like that's the
00:09:55
direction we're moving in to some extent
00:09:58
I think he I think it possible i think
00:10:00
everybody have should have some skills
00:10:02
but i think they're still had to be some
00:10:04
special specialized the specialized
00:10:08
skills involved to really make sense of
00:10:10
this data to make sure oh this is really
00:10:12
was telling you and because you make the
00:10:14
wrong strategy based on the running
00:10:16
perturbation that can be very
00:10:18
detrimental to the firm so again
00:10:20
somebody people should have the ability
00:10:22
to understand the results but people who
00:10:24
actually generate those result require
00:10:26
some specialty special trainings
00:10:44
you
