Building Trust as a Foundation for Sustainable Business Strategies
It seems almost ironical, but the currently and constantly growing number of legal and regulatory requirements might be the important (and first actually working) catalyst for changing the attitude of organizations towards privacy. While the true rationale behind it are most probably the substantial fines that come with several of these regulations, first and foremost the GDPR.
The value of customer data, from basic account data to detailed behavioural profiles is undisputed. And whether information is really the new oil in the digitalized economy or if comparisons are misleading anyway: Customer identity and access management (CIAM) is already a core discipline for almost any organization and will be even more so.
Changing the attitude towards consumer and employee privacy does not necessarily mean that all those promising new business models building upon data analytics are prevented by design. But it surely means that all the data can be used for these extended purposes if and only if the data subject (consumer, employee, social user, prospective customer, etc.) gives permission. This user consent is something that will need to be more and more deserved by companies relying on user data.
The problem with trust is that it needs to be strategically grown over long periods of time, but as it is highly fragile it can be destroyed within a very short period of time. This might be through a data breach, which surely is one worst case scenario. But the mere assumption, maybe just a gut feeling or even hearsay that data might be reused or transferred inappropriately or inspected by (foreign) state authorities can immediately destroy trust and make users turn away and turn towards a competitor.
The real question is why many organizations have not yet started actively building this trusted relationship with their users/customers/consumers/employees. The awareness is rising, so that security and privacy are moving increasingly into the focus of not only tech-savvy users, but also that of everyday customers.
Building up trust truly must be the foundation of any business strategy. Designing businesses to be privacy-aware from ground up is the first and only starting point. This involves both well-thought business processes and appropriate technologies. Trustworthy storage and processing of personal data needs to be well-designed and well-executed and adequate evidence needs to be presented to many stakeholders including the individual Data Processing Authorities and the users themselves.
Being more trusted and more trustworthy than your competitors will be a key differentiator for many customer decisions today and in the future. And trusting users will be more readily willing to share relevant business information with an organization as a data steward. But this must be based on well-executed consent management lifecycles, especially when it turns out to be to the benefit of all involved parties.
KuppingerCole will embark on the Customer Identity World Tour 2017 with 3 major events in Seattle, Paris and Singapore. Trusted and privacy-aware management of customer data will be a main topic for all events. If you want to see your organization as a leader in customer trust, you might want to benefit from the thought leadership and best practices presented there, so join the discussion.