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Why The Community CEO Doesn’t Work

November 14th, 2007 at 10:32 pm

Source:CenterNetworks -

I’ve written about Mahalo before including when we took a look at Mahalo’s Alexa ranking. A quick visit to Alexa today shows 60% of their traffic is directly to internal sites and what that means is most likely somewhere around 70-75% of the Mahalo Alexa rank is actually internal traffic (i.e. their guides). I note this because it’s a good segue into the topic of this column: Why the Community CEO doesn’t work.

Earlier this week Mahalo CEO Jason Calacanis posted a question on LinkedIn to his connections. The question was, "How would you get Mahalo Daily to 250k daily viewers?" So far there are 24 responses from his fans. He has posted questions like this before including "What would you do as Mahalo CEO?" on his blog and on other sites as well. This is what I mean by "Community CEO". I believe this is a mistake for two main reasons: a. The customer loses faith in the product and b. The staff loses faith in their leader. This article isn’t only about Jason as I have seen other CEOs do this as well, he just seems to be most vocal about it.

The Customer Loses Faith in the Product

When the person who is supposed to be leading the product asks the customer for help time-after-time, it makes the customer lose faith in the product itself. If the CEO can’t figure out what to do, then why should I use the product and put my trust in it?

While SEO directory products like Mahalo have low switching costs, there is still a cost. Users want to believe in the products and services they use and when the Community CEO comes onto the stage, users may start to look elsewhere.

I also find that people wonder if the Community CEO is really a leader. Personally I don’t understand why I should provide free advice to a healthy company without some reward or return? In the case of asking about how to raise video views, I don’t see a benefit for me as the "helper". I help Drupal because I know my help will make Drupal a better product in future releases.

The Staff Loses Faith in their Leader

Can you imagine a staff meeting by a Community CEO? When a team member asks a question, the Community CEO responds with, "Jane, let me ask my Facebook friends for how to handle and get back to you." It’s important that the leader of a company act like the leader. We’ve seen tons of corporate scandals ruin the morale of the staff and a Web startup is no different.

I’ve never seen a Fortune 100 CEO asking the public for advice on how to run his or her business. Not once. Do CEOs need help? Sure. They get help from their network including other execs, consultants, etc. Mahalo has a very large war chest. Instead of creating videos, Jason might be wise to use some of that money for strategic advice.

In Mahalo’s case, Jason is relying on loads of employees to build his application. If I was a guide, I would certainly question Mahalo’s ability to be a going concern. Perhaps the fact that they get a check makes it ok.

Conclusion 

Most Community CEOs have tons of contacts that they can reach out to privately for ideas and tips. I am by no means saying that a CEO should have all of the answers but asking for help should be dealt with properly. While the Internet is all about openess and sharing, everyone is trying to build a business, a real, revenue-sustaining business. Let’s not forget that. If you are the leader of the ship, be the leader.  And the CEO is the leader.

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