Turbotodd

Ruminations on tech, the digital media, and some golf thrown in for good measure.

Posts Tagged ‘information technology

Six Keys To Effective Reputational And IT Risk Management

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In September of last year, I blogged about the IBM 2012 Global Reputational Risk and IT Study, which I explained was an “investigation of how organizations around the world are managing their reputations in today’s digital era, where IT is an integral part of their operations and where IT failures can result in reputational damage.”

I also wrote “corporate reputations are especially difficult to manage in an era when anyone with a smartphone and Internet connection can file their complaint with a single touch.”

That continues to be the case, but what’s new is that IBM has recently issued another report on further implications of this study and its findings, and more importantly, what organizations can do to get on offense when it comes to better managing their corporate reputation.

The Connection Between Reputational Risk And IT

When the corporate world first began paying attention to the concept of reputational risk in 2005, organizations’ focus tended to be on business issues like compliance and financial misdoings.

Today, the focus has shifted to include the reputational impact of IT risks. Virtually every company is now reliant on technology for its critical business processes and interactions. While it may take 10 minutes or 10 hours to recover from an IT failure, the reputational impact can be felt for months or even years.

IBM - Factors Affected By IT Risk

Reputational damage caused by IT failures such as data breaches, systems failures and data loss now has a price tag. According to analyses performed by the Ponemon Institute, the economic value of a company’s reputation declines an average of 21 percent as a result of an IT breach of customer data — or the equivalent of an average of US $332 million.

The question now is not whether IT risks affect your corporate reputation, but what you can do to effectively prevent and mitigate these risks.

IBM -- True Price Of Reputational Harm

Six Keys To Effective Reputational And IT Risk Management

An analysis of responses to the IBM study revealed distinct correlations between the initiatives that organizations are undertaking to protect their reputations from the ramifications of IT failures and the overall effectiveness of their reputational and IT risk management efforts.

Based on this analysis, and the pattern it revealed among organizations that are most confident in their ability to prevent and mitigate IT-related reputational risk, there are six key initiatives that IBM recommends as part of every company’s efforts:

  1. Put someone in charge. Ultimate responsibility for reputational risk, including IT-related items, should rest with one person.
  2. Make the compliance and reputation connection. Measuring reputational and IT risk management strategies against compliance requirements is essential.
  3. Reevaluate the impact of social media. In addition to recognizing its potential for negative reputational impact, social media should be leveraged for its positive attributes.
  4. Keep an eye on your supply chain. Organizations must require and verify adherence of third-party suppliers to corporate standards.
  5. Avoid complacency. Organizations should continually evaluate reputational and IT risk management against strategy to find and eliminate potential gaps.
  6. Fund remediation; invest in prevention. For optimal reputational risk mitigation, companies need to fund critical IT systems as part of their core business

IBM -- Importance Of Reputational Risk

How IBM Can Help

When planned and implemented effectively, your organization’s reputational and IT risk strategy can become a vital competitive advantage. When you protect against and mitigate reputational risks successfully, you can enhance brand value in the eyes of customers, partners and analysts. Further, your organization can better attract new customers, retain existing customers and generate greater revenue.

IBM can help you protect your reputation with a robust portfolio of IT security, business continuity and resiliency, and technical support solutions. You can start with an IT security risk assessment, or penetration testing performed by IBM experts.

For business continuity and resiliency, you can begin with a Continuous Operations Risk Evaluation (CORE) Workshop and move on to cloud-based resiliency services. Our technical support solutions range from basic software support to custom technical support.

What makes IBM solutions work is global reach with a local touch. This includes:

  • Over 160 business resiliency centers in 70 countries; more than 50 years of experience
  • More than 9,000 disaster recovery clients, with IBM providing 100 percent recovery for clients who have declared a disaster
  • A global network of 33 security operations, research and solution development centers; 133 monitored countries
  • 15,000 researchers, developers and subject matter experts working security initiatives worldwide.

To learn more about the IBM Global Reputational Risk and IT Study go here.

Students To IBM: Think Local, Act Global

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On the topic of globalization…last week, IBM released results of a first-of-a-kind survey that I’ve been wanting to blog about and share (but am just now getting the bandwidth to get around to).

The survey was part of the IBM 2010 Global CEO Study, but this particular component I want to tell you about was getting into the heads of university students around the globe. 

Think about some of the key current topics: BP oil spill, increased focus and investment in green energy, challenges of a global workforce, physical infrastructure challenges in a time of increased budget deficits, and so on.

Then think about the university students’ reactions and results from the study: They are extremely concerned with issues around globalization and sustainability.

However, only four out of 10 believe that their education had prepared them to address these issues.

Ouch.

Creativity Is Key

It also revealed that both students and CEOs believe that creativity is the most important emerging competency of future leaders.  It also revealed clear confidence about the ability of information technologies to address looming issues in business or society.

I’m certainly seeing that here while in Bangalore, the IT hub of India. 

The study also revealed a decidedly optimistic new ethos, one based on an integrated view of globalization, sustainability, and belief in technology as a path towards solutions for both emerging and existing problems.

Almost 50 percent of students indicated that organizations should optimize their operations by globalizing, rather than localizing, to meet their strategic objectives.

Generation Gap, Data Driven

However, they also described a gap in this generation’s training to cope with issues that will arise in an increasingly interconnected and complex world – which is where their strong belief in IT as a gap bridger came into play.

Students surveyed indicated that they will lean more heavily on data analysis — over gut instinct or existing "best practices" — to reach their strategic and operational goals as business leaders in their own right.

And as fact-based decisions begin to prevail, they may need to pioneer an entirely new management style — one that continually enriches personal experience and education with new sources of insight based on a new ability deal with the explosion of real-time information. 

The study also revealed broad-based confidence that increased access to information, analysis, and the resulting insight can reduce uncertainty about the future.

Clearly, the students’ experience regarding globalization is different. 

Growing up more connected globally, students see the shocks and threats, but are more prone to view globalization as an opportunity to solve increasingly global problems.

They are strongly committed to a global view of shared responsibility for both environmental issues and societal prosperity.

Students, for the most part, shared their views, and even agreed on very specific courses of action: embodying creative leadership, reinventing customer relationships and building more dexterous operating models.

Nevertheless, for all the areas of agreement between students and CEOs, twice as many students selected globalization and environmental issues as one of the top three factors to impact organizations and expected major consequences to business and society from a scarcity of resources.

Bold positions like these came about because students clearly saw that globalization provides an opportunity for organizations to create new value.

Compared to all other regions, the views of students and CEOs on sustainability diverged most sharply in North America.

Students there were almost three times as likely as CEOs to expect scarcity of natural resources to have a significant impact. They were more than twice as likely to select environmental issues as a top external force.

And 60 percent more students than CEOs in this region anticipated that customer expectations for social responsibility will increase significantly. 

The Digital Deluge

Given that today’s students grew up in a digital age, intuitively understanding that economies, societies, governments and organizations are made up of interconnecting networks, it may not be surprising that seven in 10 students experienced the new economic environment as significantly more complex today, compared to six in 10 CEOs. 

But they saw far less volatility and uncertainty, in part because they were confident that access to more information could be put to better use, analyzed for patterns and predictive insights to solve the hardest problems in business or society.

Students who saw significantly more complexity, or interconnectedness in the environment, were 50 percent more likely to expect significant impact from the information explosion and 22 percent more likely to believe that a focus on analyzing information for insight would be key to organizations’ success in the future.

Views about the impact of the information explosion were fairly uniform across regions, except in China where students were 67 percent more likely to see a large impact than CEOs in China. Students in China were also far more likely to approach decision-making analytically, relying on facts more than instinct, or even experience.

Global Thinking, Local Views

Students’ attitudes toward globalization were reflected in their expectations of leadership as well.

Like CEOs, students selected creativity as the top emerging leadership quality for the successful enterprise of the future. But among the nine leadership traits CEOs and students were asked to select, students placed a higher emphasis on only two qualities -– global thinking and a focus on sustainability.

In China, 76 percent of students value global thinking as a top leadership quality, more than students anywhere else. Yet, only 38 percent of students in China believe their education has prepared them for global citizenship, which is lower than students in any other region.

Only 17 percent of students in Japan, less than any other region, believe their education has prepared them well to benefit from the growth of emerging markets.

Understanding these and other sharp differences emerging by geography is increasingly important as economies and societies become more closely linked.

Students will confront these differences as they increasingly become the future leaders of business and organizations.

It’s a set of results both heartening and yet eye-opening. 

If you’d like to read the full results and learn more, visit the IBM Future Leaders site.

Written by turbotodd

June 23, 2010 at 10:02 am

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