When shouldn’t an organization use social media?

Facebook broke 200 million users this month. Wikipedia is one of the most well-known websites in the world. Blogs affect stock prices. NPR is all over podcasting. Celebrities talk about Twitter on late night TV. The POTUS even used Twitter to announce he’d be taking questions for his livestreamed townhall at the White House with Google Moderator and blogged about it. Heck, President Barack Obama’s Open Government Directive will encourage Federal agencies to tweet and use other social media tools to achieve greater transparency.

Paul Gillin made some excellent points in a recent BtoB Magazine article, “When to avoid social media,” that I think Sarah Peres undersells in her recent post on ReadWriteWeb, When NOT to use Social Media, without perhaps giving full weight to his experiences talking to large enterprises about how they use technology.

I find Gillin’s last point most compelling, given that privacy and regulatory concerns that pertain to social media are an area I’m paying close attention to right now — and not just because I work at a public company myself:

Privacy and regulatory concerns. While a few health care companies have started blogs and social networks, most are proceeding with justifiable caution. If you’re in an industry where people can go to jail for what they say in public, you should be careful. Much as I hate to say it, you should probably get the lawyers closely involved.

Most large enterprises and governmental agencies have protected, proprietary or personally identifiable information that they can face considerable liability for disclosing or failing to protect against a data breach.

In those environments — and let’s be clear here, we’re not talking about a “handful of examples,” given the proportion of the economy constituted by big business, government, law and healthcare — jumping in to Twitter, Facebook, LinkedIn or other public-facing social media tools may hold much more risk than reward if it’s not done carefully. For attorneys, for instance, individual features like “Recommendations” on LinkedIn may pose ethical issues. Paul’s right; if such an organization doesn’t have a strategic vision or buy-in from upper management, they’re likely better off staying out of actively — and be clear with staff that that is the expectation for them as well. That doesn’t mean they shouldn’t be doing active brand management; just that posting publicly may not be optimal.

All of this pertains to social media as it exists on the public Internet. Once the various tools, including blogs, wikis and microblogging platforms, move behind the firewall, however, many of the issues posed by corporate communications and data leaks are addressed. That is, if the software is secured like rest of the enterprise’s systems. Adoption of social media tools in the form of collaborative social software at enterprises, or “Enterprise 2.0,” provides an entirely different value proposition and list of considerations that I’ll leave to folks like Professor McAfee to pose. I would note that if the CIA could create, extend and maintain an Intellipedia, there’s hope for even the most hidebound, hierarchical organizations to follow suit.