Ethics Takes Centre Stage

Last night I attended an event where Ann Roberts of Badoo and Nick Lisher of Nextdoor were discussing the meaning of enterprise values and their application to governance for Digital Platform based enterprises.

In the wake of the various regulatory issues that Facebook has had with Data Privacy legislation in Europe and Uber has encountered with employment law and regulation of taxis in a number of countries and cities, including London, this was a highly relevant discussion. It was pparticulalry refresshing to hear Nick Lisher say "I find GDPR liberating." as he went on to expound the fact that Nextdoor's values and approach meant that they had not had to alter or adapt their product at all to ensure compliance, which confirms assertions that I made in an earlier post that GDPR forces you to do the things that you should do anyway. It gives a great argument to persuade finance that it is necessary to pay for them.

All in all it boils down the the issue of running a digital enterprise as an ethical concern, which is a pre-requisite that I identified in "The Way of DAU", my take on how to adopt a Business as Usual business model.

Digital Business models amplify the concepts behind customer care theory. Traditionally this has proposed that 70% of sales are repeat sales to existing customers and that it is roughly 10 times cheaper to do something to keep a disgruntled customer, by addressing complaints positively, than it is to gain a new customer. Also if you manage to delight a customer, he or she will tell 10 people and sell your company. If you annoy them, they will tell even more and damage your reputation. Badoo's business model actually relies on this, because if you successfully match someone up with another person, Badoo may lose them as customers, but they will tell everyone that it was how they met and sell Badoo positively. Conversely, there have been significant backlashes over how Facebook uses people's data, and recent slow downs in growth and consequent loss in market value, are not the first time that Facebook has suffere significant customer defections.

Google used to have a great reputation when everyone believed in its "Do no Evil" credo, but is gradually losing mindshare with significant portions of people as a result of failure to translate this into a positive corporate culture where ethical concerns are addressed and seen to be addressed by the people who work there, its customers and increasingly EU regulators.

However, whilst we were discussing this and what happens in many traditional PLCs, a penny dropped. It's not just the the Leaders of a digital enterprise who need to be focussed on instituionalising ethics as a core of company culture, but also the shareholders. The llatter need to align themselves with the long term view and how value is created. There's too much emphasis on quick results and returns and not enough on long term value and scalability. Ethics needs to be seen part of a digital business's scalability, not just the architecture of digital products and operational robustness.

DIGITAL DECEPTIONS & ACCELERATION

It has been a great week for special events. Trump did the unspeakable and pulled off the Presidential contest in the US. Who would have forecast it?

Away from politics, there has been great excitement with the announcement that Dubai could host the debut of HyperLoop One's radical transit technology, linking to Abu Dhabi in 12 minutes and implementing Elon Musk's vision of near supersonic pod transport.

Sitting over a glass of Moldovan Wine (yes Moldovan) at the World Travel Market, in London's Excel, I casually bumped into one of London'd start up kings, Razvan Patrascioiu, see http://bit.ly/2fydFf4 , who is working on his new venture to ensure that London's visitors get to really enjoy the great restaurants that have become part of the capital's landscape. Later over Slovakian and Israeli wine on other stands I mused on the power of wine to connect people, especially in the digital world. So anyone who is remotely keen on this idea should check out the Chief Wine Officer on LinkedIn and Twitter. This is still my favourite digitaly enabled marketing vehicle and remains extremely effective at connecting CIO level people with technology providers.

Anyway, anyone who actually read my post about digital vikings, will know that digital entrepreneurs face defensive business fortifications which can derail their asymetrical attacks on new markets. This week Facebook halted the deployment of a Fintech Insurance app aimed at correlating facebook behaviour with driving behaviour. Facebook will not release the data to be used in the app. It's against their policy. Additionally, Uber was told that under UK law, their drivers are effectively employees and entitled to minimum wages and holiday pay. This just goes to show, that you need to able to respond quickly to set backs and if you cannot anticipate problems, at least plan to implement in ways that adapt to changes in circumstance and don't burn all your funds at once.

Finally in a great demonstration at the ACM Conference on Computer and Communications Security Hofburg Palace, Vienna, Austria, researchers from Carnegie Melon demonstrated how special glasses could be used to fool commercial facial recognition systems. For example a male test subject wearing the special glasses was recognised as actress Milla Jovovich..