One of the world’s largest banks, HSBC, has caved in to a pressure group organised on Facebook. The group called “Stop the great HSBC Graduate rip off” has attracted nearly 6,000 members on Facebook. The group was set up to campaign against the fact that students who recently graduated were going to be charged interest on their overdrafts, when they thought their interest-free period would continue.

The success of the social networking pressure group has brought negative headlines for HSBC. The Times covers the story in depth and on the BBC News web site also gives the story prominence. Google News this morning reported that the story was in 41 different web sites. Interestingly, the story does not make it onto the “Newsroom” of HSBC itself.

So what does all this tell us. It confirms that there is power in social groups. Women, for instance, received the ability to vote in elections because of a social group making its views felt. Similarly, protest groups have succeeded in diverting roads and changing planning decisions. Only a couple of years ago a vocal group in my village squashed plans for a new quarry. Social groups can have an impact.

However, in the past they were of limited impact. Getting large numbers was difficult to arrange. Organising meetings was time consuming and getting people to take any kind of action required real persuasive skills.

Online that is all different. It’s easy to organise – takes only a minute or two to set up a group on Facebook for example. Plus it’s easy for people to join in; the commitment level is a lot lower for an online group, compared with traditional protest groups. There is also an additional benefit for online social protests – they are much more visible. Social groups that have tried to bring about change have only really been able to succeed with large levels of publicity, which is often difficult to organise. Now, the Internet automatically brings about the publicity that can make a social protest a success.

The fact that HSBC performed a U-turn is interesting but what’s amazing is that it has taken them so long to do anything. The campaign against them started back in June, here we are almost three months later before they cave in. Either they were not aware of the campaign – and they should have been. Or they thought it was only a bunch of people on Facebook and didn’t understand the power of social networking. Or they simply don’t understand the Internet very well and what it achieves. Probably it’s a combination of all these things.

However, there is a clue on their own web site. The fact that the jointly issued news release from the National Union of Students and HSBC has not yet made it onto the company’s own web site suggests a low internal priority for matters related to the Internet. The attitude that the company’s web site is something “done by IT” is endemic in most corporates – and like HSBC that could cause them signficnat problems. The Internet is now central to society; it needs to be central to every business, otherwise there is the danger that those who understand the Internet, like students, can damage your company.

The HSBC experience this week is a wake-up-call to companies to stop tinkering with the Internet and to focus their entire business around it. A major shift in boardroom thinking is essential.