Business ethics is one of those terms I hear most often in jest, another in the long list of oxymorons. Of course, you can do business and be ethical, although it is likely more difficult to do it this way.
The law makes companies operate by some ethical codes, but other issues are either not covered at all or barely touched upon, leaving companies to police themselves.
This means that policies are based on the personal moral or ethical code of the company leaders. I know what you’re thinking, and you’re right. This could get disastrous, especially if the leaders of a company have questionable personal morals or ethics.
Why the Gray Areas?
Since the coming of the digital age, politicians and regulatory bodies have been scrambling, trying to come up with clear-cut policies on things like data usage, privacy, and other related aspects. Success has been slim in this area.
Technology changes so rapidly, regulatory agencies have a tough time keeping up, and it is a hassle all around for businesses and regulators. The rising popularity and usage of data analytics raises even more ethical questions.
What is Data Analytics?
If you are not aware of what data analytics is, here is a simple definition, broken down into steps.
- Raw data is collected.
- The data is analysed.
- Companies look at the analysis results.
- The results are used to help companies make important decisions, grow, expand, change, etc.
That is the gist of it. The amount of analysis done and the conclusions are usually based on the needs of the company.
Why is Data Analytics?
Data analytics is employed by tonnes of companies these days. It sounds boring, but there is a wealth of information to be had from the results. Here is why data analytics is done by so many businesses today.
- Results can show patterns, such as in spending, buying, highest-selling products, lowest-selling products, etc.
- Results can help a company determine what time is the right time to expand, downsize, introduce a new product, discontinue an old product, and other important decisions that could affect the company’s future.
- Data analytics could potentially help improve customer service by analysing customer data and finding out what they want.
The large amounts of data that companies analyse can easily be put to ill use if not checked. This is why definitive regulations are necessary. You may not be able to imagine improper usage of data analytics, but the potential is great.
Authorities do not have much in the way of regulation as far as analytics is concerned, so it is largely up to the company itself.
What to Do
If you are in the business owner’s position or other decision-making position, here is some advice on what you can do regarding your analytics while avoiding ethics violations.
- Get details on what is explicitly illegal.
- Use personal morals to help create policies.
- Ensure policies are defendable at any time.
- Implement those policies.
Aftermath of Improper Data Analytics Usage
If you end up improperly using data analytics, there are a number of things that could happen.
- You could end up being fined because of violations.
- You could lose customers.
- You could lose employees.
- You could lose your business.
Since there are not many clearly defined rules in this area, be careful, and if it feels wrong, don’t do it. That is the best advice I can give you on the subject.