I’m a child of the Sixties, but however much I would like to conjure up images of hanging out with Hendrix on the King’s Road, the truth is less swinging: I was born in 1965 and spent most of the Summer of Love trying to keep my formula down.

But while our parents believed whatever the man from the ministry said, our generation grew up deeply cynical in a post-Profumo and Vietnam world.

This background seems to help us navigate the maze of information that social media brings to us. In a world where everyone can have an opinion and express it, deep cynicism seems important.

In the US there are a number of lawsuits against review sites that allegedly operate as a cyber-protection racket: “Pay us da money or else an accident could happen to your review rating”.

The problem is very deep-rooted, with hedge funds trying to manipulate company prices, false postings of product reviews, marketing agencies creating personas to boost clients and political parties pretending to be White Van Man.

One might expect the Eighties generation which has grown up into all this to be experts at handling the noise. They have seen a thousand school friend postings saying “JayZee snogged Mo behind the bike sheds” when in all veracity no tongue-to-tongue contact ever occurred. In fact my experience is that they seem strangely less able to filter the truth than us ageing Stones fans.

The answer given at this point is some sort of argument about the wisdom of the crowd and how the truth will win out. But analysis needs knowledge, and those of you who would fly an aircraft designed by the wisdom of the crowd might pretty soon meet with the wisdom of evolution.

The very generation born into 24/7 information seems not to understand it. I recently visited a job candidate’s Facebook profile, which duly revealed: “I like sleeping at work and nicking stuff”.

The understanding is missing that this posted stuff is not just accessible to JayZee but to everyone and, thanks to digital archiving, will never go away. This persistence of information can no longer be left at the legal department’s door but is now a key issue for the CIO, leading to some of the largest architectural decisions in the enterprise today.

The naivety of YouTube’s founders in their email correspondence in the Viacom-YouTube case is testament to this. Those emails seem strangely generation Eighties.

The CIO can’t ignore social media. Inside the firewall, there has been much talk about the collaborative use of social media in terms of search, wikis and blogs, but the problem here is that there needs to be know-how and not just opinion. How do you separate the wisdom of the crowd from the wisdom of the clowns?

Not all commentators are equally skilled or knowledgeable and in some professions such as journalism you need to keep knowledge and contacts to yourself.

There are practical difficulties as well. It may be a rogue employee that makes bullying or abusive commentaries, but it’s the company that bears the responsibility.

False identities also crop up. I was talking to a law firm’s CIO who had introduced a social-based expertise location system. It turns out if you ask City lawyers to create a profile of their expertise, they all tell you they are experts on entertainment law. Given the number of us who wrote bad pop songs in our teenage years, the explanation is obvious. They are bored sick doing yet another multi-billion-dollar Lehman’s repo scheme and are desperate to meet Madonna and get free concert tickets.

There are solutions to these problems, such as analysing what is written and read, auto-filtering for abuse and weighting commentary by experience or usage.

But the big opportunity is what is happening beyond the firewall in terms of influence and sentiment. Today’s customers no longer do it by word of mouth, but by review, blog and tweet. Whether the crowd is wrong or right, it’s vital for companies to understand its often capricious viewpoint.

This is not easy – it’s real-time, you can’t predict what to look for and words have different meanings... wicked, eh! It is however worth the effort, and news organisations can attest to how rapidly social media reflects events.

Technologies that can understand, filter and track the sentiment of this flow in real-time can be very valuable, allowing an agile corporation to deal with events, competitors and opportunities faster than ever before. Expect marketing to appear at the CIO’s door asking for a solution.

Social media is an inherent part of people’s lives, and corporates and the children of the Eighties will need to learn how to get the value out of it.

As the famous New Yorker cartoon said: “On the Internet, nobody knows you’re a dog”. At least the Sixties generation can smell the faint whiff of canine...

About the author:

Mike Lynch is the founder and CEO of UK software company Autonomy