Digital Risks Ignored
I was very interested recently to see a survey from McKinsey & Co. indicating that C-level executives said they are stepping up their involvement in shaping and driving digital strategies. According to McKinsey, “This is vital to the success of digital programs, as survey respondents most often cite a lack of senior-management interest as the reason for an initiative’s failure.”
In the survey, released in August, the researcher asked respondents about five digital-enterprise trends: big data and advanced analytics, digital engagement of customers, digital engagement of employees and external partners, automation and digital innovation.
Companies were polled on their adoption of and focus on each trend, what impact digital technologies had on their businesses, and what obstacles companies faced in meeting their digital goals.
“We found that despite the organizational and talent challenges, executives remain optimistic about digital business,” according to McKinsey.
Respondents reported, for example, that their companies were increasingly using digital technology to engage with customers.
Growing numbers also reported that their companies were making digital marketing and customer engagement a high strategic priority.
“Nevertheless, there is more work to do,” according to the authors of the report. “Most executives estimate that at best, their companies are one-quarter of the way toward realizing the end-state vision for their digital programs.”
Why just one-quarter of the way? The answers can be found in the issue that was ignored in the survey — data security.
Increasing digital involvement comes with increased risk of data theft or corruption by any number of governments or industrial spies.
C-level types (and insurance executives, in particular) are not unaware of these risks; yet, it seems strange that they are ignoring the security question and waxing so poetic about enlarging their digital footprints.
For a solution to this seeming conundrum, I went back to my graduate school psychology days to a concept known as “social desirability.”
According to the Encyclopedia of Survey Research Methods, “Social desirability is the tendency of some respondents to report an answer in a way they deem to be more socially acceptable than would be their ‘true’ answer. They do this to project a favorable image of themselves and to avoid receiving negative evaluations. The outcome of the strategy is over-reporting of socially desirable behaviors or attitudes and under-reporting of socially undesirable behaviors or attitudes.”
In our business culture, and in our culture in general, it is socially desirable to be “pro-technology.” Thus, C-level executives — political animals that they are — want to portray themselves as being in favor of increasing the use of digital methods to drive business.
Now, I’m not saying that is true of all the executives in the survey.
Insurance executives in particular are loathe to adopt any technology too early, especially innovations like wireless.
So while corporate leaders said they want to grow digital technology, their responses may be more about how they wish to appear than what they actually think.
This may well explain why these executives reported that they are only one-quarter of the way toward their real or imagined goals for digital use.