Dynamic Strategy & Disruptive Innovation: Facebook - University Report

This report provides an in-depth analysis of Facebook's dynamic strategy and disruptive innovation, examining its corporate mission and vision statements. It explores how Facebook transformed from a social platform into a disruptive technology, focusing on the company's goals of empowering users, building communities, and connecting the world. The report delves into the challenges Facebook faces, including managing fake accounts, combating misinformation, and addressing government scrutiny. A key focus is on the controversies surrounding the 2016 US election and the Cambridge Analytica scandal, highlighting how Facebook's platform was used to influence political perceptions and create division. Stakeholder analysis is also provided, with the report categorizing the stakeholders such as users, advertisers, staff and government, and identifying their influences. The report concludes by emphasizing the need for Facebook to address negative trends, such as hate speech, and adapt to the changing landscape of social media and governmental pressures.

Running Head: DYNAMIC STRTEGY & DISRUPTION INNOVATION: FACEBOOK
Dynamic Strategy and Disruptive Innovation: A Special Focus on Facebook
Name of the Student
Name of the University
Author Note

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Executive Summary
The aim of this report is to examine the short term and long-term effects of using Facebook in
real life. This report will provide a brief introduction about the background of the company.
Then it will focus on the missions and goals of the company. Finally, in the context of
Disruptive innovation it will focus on the United States of Americas Election and the
controversy with Cambridge Analytica. It will identify the process through which the plan
was executed to form a negative impression about the opposition through hatred between the
communities.

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Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Facebook’s Corporate Mission Statement.............................................................................3
Facebook’s Corporate Vision Statement................................................................................4
Transformation of a social platform into disruptive technology............................................8
Conclusion................................................................................................................................10
References................................................................................................................................12

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Introduction
Social Media has completely changed the market scenario over the last decade. In the
initial years, it was considered a secondary platform, but with the dynamic shift of the
customer base from conventional broadcast media to digital platform, marketing and
advertisement pattern have drastically changed. The undertaken social platform taken into
consideration is Facebook. In the earlier stages, Facebook was considered just a social
networking platform but now has becoming a prime marketing hub. The advertisement world
increasingly becoming Dynamic have shifted their base towards social media due to the
increasing footfall over the years. Last two or three years saw a massive movement in these
platforms, which included primarily Politics of various countries. How the perspectives of the
users are being tactically used to drive their interests into framing a political viewpoint has
become a big issue.
The main founder of Facebook is Mark Zuckerberg. Officially, the company was
founded in 2004 in Harvard College. Initially it was restricted to Harvard. Later with
increasing popularity, it expanded into Yale, Colombia and Stanford. Later, predicting its
market capability it understood that this platform would be the big thing of the next
generation it expanded worldwide. Now it has set a benchmark by becoming one of the most
successful information technology enterprise. It has an yearly revenue amounting to $55
million, becoming the social media with the largest userbase worldwide (Investor.fb.com,
2019).
Discussion
Mission Statement of Facebook (Corporate)
The primary motive of Facebook according to the company’s point of view is to
provide the users’ authority and to bring the whole world in a common platform. Today it has

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successfully brought the whole world together in a single platform where people are getting
to know the personality and opinion of people. However, due to the exclusivity and openness
of the platform Facebook it has attracted the political perception of the people with the help
of which several organizations is accessing the platform to align the political perception of
the users and indirectly forcing them to form a wrong perception on the national politics and
their representatives. It has acted as a catalyst to segment the community on the basis of
ethnicity and originality with the state.
1. Empowerment of the Masses: One of the main goal of the organization is to
strengthen the online functionality of the users with the internet.
2. Community empowerment: Facebook has been successful in creating community
based on their preferences starting from formal communities such as businesses,
trading in shares and export import to informal engagements such as food blogging
groups, college and school groups.
3. Connecting the world: Finally, it has successfully brought the whole world in a single
platform where people can know from success stories of young entrepreneurs to crisis
of the people in countries like Uganda and Palestine.
Facebook’s Vision Statement (Corporate)
The secondary vision of the company according is “People use Facebook to stay
connected with friends and family, to discover what’s going on in the world, and to share
and express what matters to them.” The mentioned vision clearly states that making profit is
the secondary motive of the enterprise. It also provides knowledge to the people and valuable
communication among the users. The main objectives of the Statement are:

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1. Worldwide Market: Due to the popularity of the platform, it has become a global
superpower in terms in terms of digital presence. Due to its huge user base, it has
become the prime platform of advertising a particular product or service. Unlike the
conventional broadcast media, which markets products and services without customer
segmentation, this platform specifically, markets products and services based on their
searches and user portfolio. Thus, provides cost effectiveness to the organization and
effectiveness to the customer.
2. Communication Tools: With the use of pictorial, textual and video-based
communication, it enhances the effectiveness providing a detailed insight through
communication.
3. Discovering Tools: The search engine of Facebook largely differs from that of Google
Where the search engine of Google is largely based on popularity, Facebook totally
provides data based on user relevance.
4. Tools developed for Expressing Emotions: Lastly, it enables the people to gain
authorityAnyone irrespective of his or her nation, religion, caste, color and creed
everyone is equal in this platform.
Analysis of the Stakeholders
1. ACCESSSORS: The most important people for the company are the avccessors or
the users. Because of this huge user base, the company is able to make such huge
profits.
2. Advertisement and Marketing: The revenue aspect of the organization is through
advertisement and marketing. The users often can view the advertisements in
between the videos which are actually paid advertisements.

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3. Staff: The staff or employees are the human resource who work and contributes
too the functioning of the social media platform. The idea, maintenance, daily the
employees of the business control operations.
4. Governing body of the Country: The government is the
Stakeholder analysis is a process of systematically collecting and analyzing
qualitative information to determine whose interests should be taken into account
when developing and/or implementing a policy or a program. Therefore, the process
is as follows:
1. Identifying your stakeholders: Identifying the stakeholders is primary phase of this
process as they are the key people involved in the business. For a digital company
like Facebook the key stakeholders are the users, business partners, government
and advertisers.
2. Prioritize your Stakeholders: In this phase, we take the help of the interest grid to
classify the stakeholders based on their interest and influence in the business. Let
us take the help of a diagram to clearly understand the position of stakeholders in
the company.
Figure 1.1: Stakeholders Grid

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Explanation
In the first grid, i.e. where there is high influence and low interest the
category perfectly fits for government where they do not have too much
interest in the platform but possess ultimate authority and power. Therefore, to
keep them satisfied Facebook needs to communicate and engage them
regularly. Consult with them about the whereabouts of the business and keep
them informed about the changes so that technological discrepancies do not
result in conflicts with the laws and regulations of the authority. In the second
grid, i.e. where the influence and interest both are high, i.e. the advertisers
who are the sources of revenue to the company. Therefore, to keep them
satisfied with the services frequent communication is required along with
active involvement in the business to make them realize about their
importance. In addition, their feedback should be considered and effective
changes must be made according to their requirement. In the third grid, both
the interest and influence are low. Non-users fall in this category where to
convert them into active users they must be kept updated through e-mails to
increase their interest. Lastly, in the fourth quadrant the users are categorized

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in this segment where they have how interest but low influence individually,
which can affect the business adversely. However, it is to be considered when
these individual users form a community they shift from the 4th quadrant
where the interest is high and influence is low to the second quadrant where
the interest and influence both are high, as they become influencers in the
business.
Challenges
From the technical point of view the main challenges faced by Facebook are
blocking and removing fake accounts; finding and removing bad actors; limiting the spread
of false news and misinformation; and bringing unprecedented transparency to political
advertising. Over the years it has also improved machine learning capabilities, which allow
us to be more effective in finding and removing violating behavior. These technology
advances help us better identify and block bad activity, while our expert investigators
manually detect networks that are more sophisticated. As a result, millions of fake accounts
are removed on a daily basis that creates fake identifications and personally tries to affect
other users’ life. In the previous year, we have improved rapid response efforts across our
teams. Last year, we removed thousands of Pages, groups and accounts involved in
coordinated inauthentic behavior. On the other hand, the company looks forward improve the
operation system to the extent that any third party which tries to interfere with personal data
of other users will directly legally alleged by the government. The next step for the
organization is to make tie ups with the Governments of different nations so that the crucial
data can be protected with respect to government violations. For example, the organization
received a suggestion from the federal bureau of Investigation just 2 days before the
American elections helped the organization to track down coordinated effort by third party
foreign entities. Meanwhile, Facebook has also joined hands German Federal Office for

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German National Security purposes and both parties formally worked very closely and in an
integrated structure during the State Elections in the year 2017. The company in recent times
have a challenge that the platform they have created does not go out of control. On the other
hand, to create affection towards a particular cause or community it has become necessary to
hate the opposite aspect. Hatred has become the prime aspect in this platform. Whenever a
user opens up the application they are greeted by hate speeches and 80 per cent of the users
are actively engaging in this negative community creating a larger user base. The major
qualitative problems are as follows:
1. Negatively Inclined Headlines
Hatred through Facebook has become very persistent for the last two or three
years. And this problem will not stop magically. Some unique methods has to
be undertaken from the organization’s side. Recently, a famous Russian actor
exploited the platform by demographically targeting a particular community to
create a political biasness forming a negative unity to react against the
community through hateful aggression. The sister platform of Facebook i.e.
Instagram also faced similar problem in this aspect as there exist numerous
fake accounts which has managed to escape examination as the process
focused solely on Facebook and not instagram. But equal measures are being
taken in recent times to reduce the amount of discrepancy occurring in these
two platforms.
2. Pressures of Monetization
The main user base is steadily shifting from Facebook to its photo sharing
platform i.e. Instagram. So, to maintain the revenue standard it has to shift the
customer base of advertisement from Facebook to Instagram. Considering the
Newsfeed factor which is drastically declining as per the viewership which is

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shifting away to twitter do the increase in following trends. Therefore, to
tackle this problem the core business of Facebook has to undergo severe
changes to change the total advertisement attracting strategy.
3. Problems with Government
With the Government realizing that the platform i.e. Facebook is taking a
wrong turn and the theme of socializing has been transformed into creating
virtual mobs spreading hatred among the communities. So, the government of
various countries especially USA has become very alert over the last few
years. The Government is keeping a close observation in every new step taken
by the company. This has given rise to huge internal problems. Some have
voted against the Chief Operating Officer Sheryl Sandberg and wants her to be
fired and others have voted against Mark Zuckerberg for a thorough check
who controls the major operations and major stakeholder in the company. But
the company has not hinted that no changes in management is necessary as of
now.
4. Trusting in Technology
Facebook over the years has been losing its credibility, there exists proper
evidences that people have acquired super addictive technology and social
media is becoming negatively skewed and affecting human behavior adversely
as per advanced economics. On the other hand, mobile manufacturing
companies such as Apple are using suggestive technology to reduce tech
addiction and helping people to spend minimum time in mobile application.
However Facebook has its own way of persuading people and people though
gets restrained from using it for a short period of time, in the long run due to
presence of other users belonging to the same community they again return

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back to the platform as it has become a necessity in daily life. According to
Truvalue Lab’s Head Andre Shepley revealing ESG data. “(shorthand for
environmental, social and governance scores), Facebook's period of highest
growth and strongest profit margins coincided with mounting signs that it was
unfairly compromising the well-being of its users, in more ways than one: "If
we see a structural shift where people become more aware that it's not healthy,
a reversal will negatively impact Facebook's core business”
5. Development Process
As people are trusting the company by providing their personal data such as
birthdate, gender, organization, school or college, relationship status and so on. It is
the sole responsibility of the company to provide privacy and protection to the users.
People also use the Facebook app as the official authentication to register in other
applications. Facebook many a times has failed to protect the personal data in the past
and must undergo severe development process to rectify the past mistakes the
company has committed. But conversely strengthening the privacy of the users means
to auuthorise more power to the user over the company. In the year 2016, the
company made the privacy setting more open and easy to find, adopting a GDPR style
controls across all countries of the world. In this part the company directly
asked people what information to be shared and what information are not to be
shared. Moreover it also asked what information are to be shared for advertisement
targeting. On the other hand it has also created user tools providing access and
downloading facility. This year they are planning to introduce more beneficiary tools
like clearing the history, finding the history. Thus, these steps would provide more
transparency to the users and authority will be shared party by the company and partly
by the users. In the reporting section, a new tool is being developed so that people

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themselves can report and take indirect action against people and pages who are
propagating hatred and offending other people at the personal and professional level.
On the other hand, tools such as see first, unfollow and follow allows the company to
provide a superficial privacy only maintained between the two parties.
Facebook Inc.’s CSR Performance in Addressing
Stakeholders’ Interests
As the leading social media organization, it has corporate social responsibility policies
and programs that satisfy the interests of some of its primary stakeholders. For example, the
interests of advertisers, employees, and various governments are satisfied. These programs
partly support relations with the public in Facebook’s marketing mix or 4P. On the other
hand, the company’s CSR strategy fails to provide satisfactory support for the motives of
communities as stakeholders. Also, the company faces issues in fulfilling corporate
citizenship goals pertaining to the users/members of its social network. Facebook Inc.,
together with other firms, launched Internet.org, but this effort is criticized as a violation of
net neutrality and as having hidden proprietary motives.
Based on these CSR challenges, it is recommended that Facebook Inc. enhance its
corporate citizenship initiatives to satisfy the concerns of communities, especially through
sustainability and ecological community development programs, which are two of the firm’s
corporate social responsibilities. In addition, it is recommended that the company develop
more stringent data privacy and security policies for strict compliance. This recommendation
addresses the interests of users/members and communities, while contributing to business
competitive advantage to counteract the moderate competitive forces shown in the Porter’s
Five Forces analysis of Facebook.

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Transformation of a social platform into disruptive technology
Facebook’s major expository drawback was first sighted during the U.S. elections.
The Republican Party hired Cambridge Analytica; a political consultancy firm, which
harvested detailed raw data of 87 million users in the U.S.
The detailed explanation of this link between Republican Party, Cambridge Analytica
and Facebook is being provided which are as follows:
1. Process: The process involved is a multi-link in nature, which Facebook directly or
indirectly exposed the data of 87 million users based on which the emotional
weakness was systematically taken into account. Cambridge Analytica used these
qualitative data where is segregated users based on opinion towards or against a
particular community. Opposing the immigrants became the prime factor and topic of
discussion in the election campaigns where Native Americans were indirectly forced
to oppose them as they are luring away the jobs, which are affecting them adversely.
This situation is properly explained with the help of a diagram which is as follows:
Figure1.2: Diagrammatic Representation of Chain based multi-link

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2. Connection between Donald Trump and Cambridge Analytica
The problem started when Steve Bannon, a member of the Republic Party approached
Rebekah Mercer and Robert Mercer to hire a political consultancy. Later Steve
Bannon became the vice president of Cambridge Analytica during election period in
2016. Later he became the Chief Advisor of Trump and later he was fired due to legal
tensions.
3. The Illegal Data hacking Process
CEO of Cambridge Analytica, Alexander Nix contacted Julian Assange, founder of
Wiki Leaks about the e-mails of Democratic National Committee server that were
illegally hacked. Then the confidential messages were tactically studied and exposed
to the public.
4. Data Acquiring Process
The main question, which arises, is how Cambridge Analytica used Facebook to
capture the opinion of the people. The organization reached out Aleksandr Kogan, a
Russian American and an official of Cambridge University. Kogan created a
Facebook Quiz App. Then through this process, Cambridge Analytica collected the

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data of the participants. Moreover, it was also able to collect the data of the friends
who participated in the quiz that exposed the major loophole of Facebook API.
Though Facebook prohibited selling of these confidential data, Cambridge Analytica
sold these confidential data.
5. Facebook being the prime culprit and not Cambridge Analytica
The inner conflict between the data security department and the marketing department
is the main reason behind the whole scenario. The uphill battle between these two
departments overlooked a major drawback in data security. The API itself was not
strong enough to protect the data of the users, as they not only successfully captured
the perception of the people who participated in the quiz but also the friends of those
participants who did not even participated in the quiz.
Conclusion
There are two sides of this project. Firstly, how Facebook started from scratch and
later became the most successful social platform and one the most profit generating
marketing company in the world. The mission of the company is very simple. It aims to
connect people globally providing insight about the boon and the bane going around the
world. It helped people to become more technology efficient in an easy way and opened
doors for big and future opportunities. On the other hand, due to its large customer base it
successfully became the prime marketing location of products and services via various
methods using pictorial, audio and video-based offerings. The Second part of the project
focused on the micro level problems and how the platform is transforming into a hateful
arena for discussion. It also reveals how the organization has failed to protect personal data.
The third part of the project exposes the drawback of an open social platform. It exposed how

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loophole in data security can be used for or against a government to alter election result. This
exposed how a third party organization used the social platform by conducting quiz and
supposedly used the weakness of the API to track down data, which are confidential in
nature. Later these opinions were segregated and were used in Election Campaigns in
speeches, which directly exploited the emotional entanglement of the people. Therefore, to
solve this problem the data security section and the API has to undergo major changes so that
no third party entity can exploit the users in the near future.

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References
Investor.fb.com (2019). Peggy Alford Nominated to Facebook Board of Directors. [online]
Investor.fb.com. Available at:
https://investor.fb.com/investor-news/press-release-details/2019/Peggy-Alford-Nominated-to-
Facebook-Board-of-Directors/default.aspx [Accessed 13 Aug. 2019].