The handshake has been a standard of building trust for centuries. But how do you build digital trust, and establish confidence in the other user through a computer or mobile device? How do you know that they are a real person, that they are who they say they are, and that they will provide the right level of considerations for the business relationship?
As interactions and transactions increasingly shift online, creating digital trust is essential to the smooth functioning of business operations and people’s lives. Ensuring security, privacy and reliability is the only successful path forward for a digitally transformed world. Some measures are legal requirements, some will require robust technological implementation, and others will rely on smart organizations to establish and convey their ethical standards.
Legal obligations for digital trust
For some transactional relationships, there are strict legal requirements to Know Your Customer (KYC); financial institutions and other regulated industries need to perform proper due diligence on who they are doing business with. Or, in some jurisdictions, KYC is also required if a transaction, or set of transactions, crosses a threshold.
Another set of legal requirements requires organizations to have effective policies and procedures around the correct collection and use of personally identifiable information (PII data), such as the GDPR and CCPA. Other specific industries have requirements around the use of health or credit information.
The point is that digital trust in these cases is mandated. The value of the information is deemed so important that governments have stepped in and created penalties around its misuse. As innovations continue to increasingly transform our society, we can expect more laws and regulations to enforce what are, in effect, best practices.
Organizations that have not thought through smart data security, privacy and responsibility measures will always be scrambling to meet compliance, always expending time and effort to just meet the minimum standards. On the other hand, organizations that understand the importance of trust in a digital world will have a competitive advantage. As Stephen Walsh, director of security for Northern Europe at CA states, “if customers see organizations who don't have that security, they're going to vote with their wallets and go somewhere else where they do have that sense of security and building up that digital trust.”
Technical considerations for building trust online
As we’re discussing digital activities, it’s important to note that trust in the internet age is not simply between two parties. Rather, there are a myriad of connected devices, algorithms, data collections, third parties, cross-border transfers and a future of innovations such as AIs, autonomous organizations and digital twins that require careful deliberation.
It’s not only your own systems that need vetting, but a supply chain of interconnections that are potential source of errors, leaks, misuse, inaccuracies, breaches, points of failure and other problems.
Some suggestions for building trust into your organization:
- Data audit
Know what information you are collecting and how you use, share and delete it
- Data lifecycle management
Create a strategic plan around how you’ll handle your data
- Security expertise
Have the staff or outside expertise to analyze, deploy and adjust trust programs
- Ongoing education
Understand security risks and have ongoing training for all employees
- Control systems
Install automation rules and transparency models to help ensure proper access and usage
- Customer due diligence
Investigate the nature of the customer and the potential threat they pose
- Ongoing monitoring
Implement procedures to spot suspicious activity
Owning digital trust — establishing responsibility, reliability and respect
Perhaps the most important suggestion is to establish trust as a core value of the organization. From the board level through to all employees, trust needs to be understood not only as a deterrent to negative outcomes but as a valuable differentiator. After all, in a PWC study, “only 23% say they plan to invest over the next year in aligning business objectives with information security strategy.” Implementing effective trust frameworks now will help establish an organization as forward-thinking, responsible and worthy of doing business with.
Your network of employees, customers, suppliers and vendors rely on you to deliver trust, and any breach impacts operation and any further opportunity. Almost every business decision needs consideration through the trust lens.
On the consumer side, the Consumer Account Opening Report 2020 found that all consumer groups feel that security is the number one factor in an optimal account creation process. In general, without trust, people will walk or switch to other providers. Consider that, according to Accenture Strategy, in 2017 the global economic value of switching providers was $6.6 trillion. And 41% of (U.S.) customers who switched providers did so because of an issue of trust.
Selecting the right vendor is not only about price or performance, but also about who can better ensure trust. In an analysis by Accenture, “if all of the corporate leaders surveyed, companies collaborate to impose high standards on partner organizations, businesses can expect to save up to US$2.6 trillion.”
Accenture also notes that “trusted digital economy could stimulate 2.8 percent in additional growth for large organizations over the next five years, translating into $5.2 trillion in value creation opportunities for society as a whole.”
Organizations that fail to establish the appropriate level of digital trust might face the wrath of regulators and abandonment by customers. On the other hand, those that respect and build digital trust have the opportunity to partake in a massive creation of value. Organizations meeting the needs of digital transformation through digital trust will drive business value by minimizing risk and building a safer world.