Innovation and technology have shown and continue to hold immense promise to improve business processes and outcomes. Think about how it has impacted an industry with which we are all familiar: financial services. Whether we are talking about the impact of artificial intelligence, biometrics,mobile payments, real-time credit scoring, machine learning or even robo-advising, financial technologies (Fintech) has carved out numerous new opportunities for both producers and customers to interact more effectively and efficiently. Nevertheless, technology often outpaces human abilities to absorb their impacts, and our institutions of governance are often slow to adapt to the leading edge of these changes.
Many of us today take our smartphones for granted, and some of us do most of our financial transactions via them. We love it when we can instantaneously transfer money to a merchant, family member or friend. We enjoy trading stocks around the globe whenever the mood strikes us to do so. We can know in an instant the state of our portfolios, then research trends and charts to our heart’s content. What we often fail to recognize in this endless march toward efficiency is that there are human impacts that we frequently don’t see, won’t recognize for months or years, or externalities that we couldn’t have possibly predicted. Many of these impacts are unforeseen, unexpected, and undesirable.
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An example of this is how easy it is for somebody to steal our identity and transact as though they were us. Hackers worldwide are constantly selling credit card accounts or personally identifiable information (PII) to the highest bidders. Transactions we think are secure are often hijacked, and it can take significant time to correct these messes. And even though most of our financial providers are earnest and try and stay ahead of these mischievous persons and groups intent on doing harm, they are often one step behind.
When we are harmed, we usually have some options. Many of us ask our financial providers to reverse these transactions, halt them and/or to make us whole again. Many times they can do these things, but sometimes they cannot. If it happens too often, we often band together and resort to the legal systems to make things right. Here again, many times this can work and the courts can return us to the state we were in before being harmed. Unfortunately, we often lose funds, time and opportunity costs pursuing these remedies. And sometimes, even the courts cannot make things right.
Our last solution is to look to government, and to ask officials for new regulation or public policies that can prevent these maleficent events from occurring, or to impose penalties on those who are caught doing these harmful actions. Our ability to “make things right” by going the public policy route is also fraught with unknowns, uncertainties, and the politics around it can leave us dissatisfied. By their nature, governments often look for consensus, least common denominators, or “middle ground” solutions. This can leave some of us pleased, while others want something else. This is why we hear about (most often in social media) the outrage of different people or groups who seek redress before many of us even know that a new product or service is problematic.
Whether we ask businesses, the courts, or government institutions to make things right, we enter the realm of ethics. Because innovations or new technologies affect people, their behavior and interactions, ethics is always present when introducing new products and services, whether we recognize it or not. A good example of this is that many businesses go by the mantra of “the customer is always right” and try to provide products or services that the customer asks for and needs. But customers often don’t know what is on offer, exactly what they want, or can adequately envision how life will be after they acquire your new products or service. In other words, how can the customer be right when they are un- or ill-informed or highly uncertain about their own values, preferences and aims?
Because ethics, ethical decisions, relationships and outcome distributions are impacted by new product or service introductions (NPSD), it is critical for executives to address ethical questions early and often in NPSD processes. In my work with companies, we often employ arms-length executives in devil’s or Cassandra’s advocate roles during early stage investment decisions – to ask questions about what could go wrong or do harm. Simulating stakeholders’ positions and views through the execution of alternative futures, scenario sessions or wargames months or years before a product is introduced can also surface potential harms before experiencing any adversity in the marketplace. Last but not least, doing a thorough invigilation of the assumptions underlying these decisions can also avert potential harms or warn executives of potential flaws that they can take actions to prevent. All of these steps are prudent, uncertainty reducing, and can help avert or lessen the likelihood of crises that are much more difficult to address once they occur.
In conclusion, executives are wise to always consider the ethical implications of introducing new technologies and innovations to the market. Doing it before the problems arise and are obvious saves money, customers, reputation and time. Ethics are and should always be a crucial decision consideration and factor. Cave Exsecutivam — ignore ethics at your own risk!