Social Media: Impact on Knowledge Sharing in Multinational Firms

This essay explores the increasing use of social media by multinational organizations to enhance knowledge sharing, support innovation, build social capital, and aid in problem-solving. It highlights how social media platforms like Facebook, Twitter, and LinkedIn are used for marketing, communication, and gathering customer feedback. The essay discusses the benefits of social media in facilitating internal and external communication, fostering employee relationships, and generating innovative ideas. It also addresses the risks associated with social media use, such as information piracy and reduced employee productivity. The essay concludes that while social media offers numerous advantages, organizations must implement corrective measures and management policies to mitigate the associated risks and leverage its potential for improved performance and competitive advantage. Desklib offers a variety of resources for students, including past papers and solved assignments.

Knowledge management is the approach adopted by the organizations by making the use of knowledge
for the achievement of its objectives. Furthermore, knowledge management can be defined as the
process of using, managing, creating, and sharing information and knowledge linked with the
organization (Becerra- Fernandez & Sabherwal, 2014). On the other hand, knowledge sharing is the
exchange of knowledge among communities, organizations, and people. Nowadays, the social media
platform is gaining immense popularity and being used by millions of people on regular basis for
interacting with friends and public. Multinational organizations are using social media for image
enhancement. It also encourages the employees of the multinational organizations for making social
interaction such that a number of innovative ideas can be generated which can lead the organization to
new heights. The focus of this essay is on the increasing use of social media by the multinational
organizations for improving knowledge sharing, supporting innovation, building social capital and aiding
problem solving.
The emergence of social media has reduced the use of traditional marketing tactics such as publicity,
public relations and advertising. Social media sites such as Facebook, Twitter and LinkedIn are being
used by almost every organization and individual. These are being used by the organization for the
purpose of marketing of its products to large public (Boyd & Ellison, 2007). Social media can be defined
as the application working with internet through which easy exchange of information is facilitated
between the users. Ambiguity and uncertainty can be reduced in a business if there is effective
communication in the organization. Social media is considered as the shortest route for communication
and marketing in an organization (Sigala & Chalkiti, 2015).
Knowledge and information is now being encouraged in most of the multinational organizations among
the employees. When innovative ideas are introduced by the employees for undertaking such practices,
they are rewarded in accordance with the benefits obtained by the organization. Furthermore, it has
been observed by the multinational organizations that the interactive employees were more prone for
creating knowledge. Pages have been developed on social media by almost every multinational
organization such as P&G, Vodafone, etc. (Inkinen, Kianto & Vanhala, 2015).
Through knowledge sharing, the knowledge of individuals gets easily transferred to the company with
the help of which innovative ideas are generated within individuals which leads the organization
towards enrichment. Knowledge sharing also allows the organization to face competition effectively
with the key competitors in the market. It further allows the multinational organizations to gather the
relevant information so that the relations with the customers can be improved and can be maintained
with more ease. In other words, organizations are able to survive the competition by achieving their
objectives (Vuori & Okkonen, 2012).
Multinational organizations are interacting with the customers and prospective clients through the use
of social networking sites. The customers can follow the organization on such platform and can offer
valuable information and feedback regarding the products and services provided by the companies. On
the other hand, the organization can publicize their brand through social media along with highlighting
their environmental friendly activities which can enhance their brand image publicly. Social media also

allows the multinational organizations to communicate with their clients in order to find out their
personal views through personal messages and posts (Hemsley & Mason, 2013).
Employees are the intangible assets of the multinational organizations. Therefore, social media plays the
role of a knowledge sharing tool among the employees thereby allowing the organizations to have
competitive edge over the competitors in the market. Social media connects the employees over the
internet and allows them to share knowledge. Valuable information is gained by the organizations from
the knowledge sharing by the employees and therefore, organizations give great importance to the
maintenance and management of social capital (Ngai, Tao & Moon, 2015).
A number of benefits are gained by the multinational organizations through the social capital as it
facilitates communication among the employees and within the organization. Social capital also
facilitates increase of knowledge among the employees which allows them to establish stronger
relationships among themselves. Furthermore, exchange of ideas, videos and pictures is eased by social
media between the employees working in different parts of the world. Also, there is an improvement in
the employee’s performances due to their increased knowledge base. Team work is facilitated through
knowledge sharing along with the personal development of the employees. Therefore, various
advantages are offered to the multinational organizations through the development of social capital
(Bharati, Zhang & Chaudhury, 2015).
Innovations have now become the necessity of businesses. Multinational organizations can sustain in
the long run only when they bring innovative products in the market. When innovative processes are
introduced, employees are motivated to perform well in the new areas by showing active involvement.
Moreover, innovative products help the organization in attaining competitive advantage in the market.
Such competitive advantage can be attained only when innovative products are brought forward by the
employees (Chen & Huang, 2009).
Social media is now used as a platform by the employees for discussing their innovative ideas with the
employees of their own or other organizations. Therefore, innovative and valuable ideas are gathered by
way of social media platform. The most important benefit of this social media is that the organizations
do not need to incur additional costs for utilizing this platform. It allows the multinational organizations
to concentrate on innovative idea generation without leading to increased expenditures for the
company. It is the duty of the employees to stay aware regarding the dynamic business market so that
they can easily identify the threats and challenges and take proper steps for addressing them (Zeng,
Chen, Lusch & Li, 2010). Companies can gain advantage of this practice only when the employees are
encouraged to bring innovative ideas into the organization. The organizations that do not undertake
such practices will lose out the opportunities to the competitors and will not be able to survive in the
market for a long period of time. Furthermore, multinational organizations can also gain ideas from the
customers who post their requirements and experiences on the social media platform. The
consideration of the view point of the customers will provide the organizations with an opportunity to
attain success in the market (Donate & Guadamillas, 2015).

External service providers create a variety of problems for the multinational organizations on constant
basis. Social media assists in providing a solution to such problems by offering open communication.
Social media allows open communication and knowledge sharing which is capable of resolving a number
of problems faced by the organizations. Employees of the organization can share the problems with the
employees of the same or other organizations and external service providers for finding solutions for the
problems. This will provide a way with the help of which such problems will not be faced by the
organization in the future. One to one relation is facilitated between the companies and the employees
with the help of social networking sites like Twitter and Facebook (Yates & Paquette, 2010).
Social networking process, therefore, acts as the best way of resolving the problems faced by the
multinational organizations. Online solutions are also offered to the customers with the help of social
media so that their problems can be easily resolved. Social media also helps in creating effective internal
communication channel through effectively transferring knowledge among various departments of the
organization (Ellison, Gibbs & Weber, 2015).
The use of social media is beneficial for the companies in a number of ways. Both internal and external
communication is facilitated by the use of social media. A pool of prospective employees is created who
gain knowledge about the companies and plan for joining the organization. Furthermore, convenience is
provided by social media by allowing easy communication with people, customers and other
organizations. The process of learning and knowledge sharing is eased among various employees and
people within and outside the organization. The most important benefit of social media is innovative
ideas provided by the employees, customers and other people. When such ideas are implemented
within the operations of the business organizations, the company is able to sustain in the market for a
longer period of time and have a competitive advantage over the competitors. Such innovative ideas
allow the businesses to meet the changing needs of the market (Hamoud, Tarhini, Akour & Al- Salti,
2016).
However, there are a variety of risks faced by the organizations due to the use of social media. The
frequency and number of crimes and frauds in the multinational organizations is increasing with a rapid
pace due to increasing use social media. The circulation of information through such platform publicly
leads to the chances of piracy of information of confidential nature. Employees also have sensitive
information about the companies which is under danger through the increased use of social media by
the employees. The employees may share confidential information regarding the organization with the
competitors who may use such information for their own benefit. Another risk of use of social media by
organizations includes getting criticized openly due to non-meeting of expectations of the customers by
the products of the organization. This also leads to hampering the image of the companies. The bad
publicity of the companies also results in the loss of potential or prospective employees of the
organization. The image of the company is disrupted due to bad publicity of the company and such news
is difficult to be hidden (Leonardi, 2017).
When the employees make the use of social media, their productivity is automatically reduced as they
spend most of their time in using it. The fall in the productivity of the employees results in the fall in
overall employees of the organization. Use of social media by the employees engages them in

continuous retrieval of information and diverts them from the implementation of change process which
constitutes the most important factor. The employees ultimately suffer from the loss of capability and
fall in the work quality. In other words, lower work capabilities are noticed in the employees who use
social media during the working hours of the organization. When employees are not able to perform
well, the overall image of the organization is lowered in the market.
Therefore, it can be concluded that the use of social media has become essential due to the increased
competitiveness of the business environment. Internal and external communication in the organizations
is facilitated through the use of social media. The use of social media has extended as a communication
avenue for the development of the organization. Moreover, it helps organizations in the marketing of
their products and services. It plays an important role in developing internal and external employee
relationships and in facilitating effective communication for the development of innovative ideas. The
integration of social media with knowledge management offers various advantages to the multinational
organizations. On the other hand, there are also a variety of risks associated with the usage of social
media by companies. Such risks include threat of the loss of confidential information and reduction
employee productivity. However, a number of corrective measures can be enforced by the organizations
along with management policy implementation so that the situation can be kept under control. When
there will be effective implementation of the process, the organizations will be able to gain the benefit
of innovation, problem solving, collaboration and social capital. Ultimately, the organizations will be able
to bring the required improvements in their overall performance and will have a competitive edge over
the competitors.

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