Databases_Ethics_and_Privacy

Databases, Ethics, and Privacy Professionals in Information Technology are under ethical and legal obligations to secure data in the database and protect personal privacy. Technology has become an indispensible asset in marketing; data mining allows companies to gather information about both current and potential customers. Companies can target a specific audience with their advertising message by collecting information (Cannon, 2002). However, protection of privacy is not just ethical, it is also legally obligatory. As people spend more time connected to the Internet, companies are collecting an increasing amount of data about their clients (Singer, 2011). Privacy policies that outline companies’ intentions concerning the data they collect are posted on nearly every website (Singer, 2011). No one surfing the web is doing so with anonymity (Singer, 2011). The lack of privacy on the Internet and concerning data mining is considered a violation of civil liberties and the public’s right to privacy (Singer, 2011). Concern recently has risen in conjunction with people’s right to privacy and health care. Pharmaceutical companies are struggling to gain access to patients’ medical records to deliver targeted advertising based on medical history. Although pharmaceutical companies’ access to patient medical history is an extreme violation of privacy, the issue of releasing personal information to companies for marketing purposes is still under debate because of the ethical obligation to protect privacy of individuals (Singer, 2011). Ethics may not be laws and laws may not be ethical, but IT professionals are responsible for enabling companies to conduct business with legal limitations and to make ethical and legal decisions for the greater good of both the organization and clients. Data mining falls into an area of ethical ambiguity; companies view collecting data about current and potential customers as their right and advocates of privacy protection see data mining as invasive. IT professionals must act ethically when they are designing systems for business use and act as guardians of public privacy. While ethics and laws are not synonymous, IT professionals are expected cooperate with legal limitations placed on their industries and within the various countries the organization may operate in. The list of legal parameters organizations must operate in accordance with is exhaustive and several are industry specific, but a few notable acts are HIPPA and the Sarbanes-Oxley Act. Each of these laws sets a code of conduct for organization in many industries and specifies requirements an organization must adhere to or face litigious action. Many companies are also under the legal obligation to protect the information they collect and to notify affected parties if there is a breach in security. HIPPA sets specific requirements in the healthcare industry to ensure that patient medical records are secured. Companies must do what they can to reduce the severity of an attack and uncover any potential security breaches in their system and are under legal obligation to disclose information concerning a security breach to affected parties. Collecting information about customers is an effective way for companies to build relationships with their customers as long as the information is properly secured. Databases have enabled companies to maintain personalized relationships with customers; companies can gather information about customers and deliver personalized messages (Cannon, 2002). Personalized messages result in a 5% increase in customer retention and a 25-125% profitability increase in business-to-business markets (Cannon, 2002). But when a company gathers personal information about its customer, the company is under legal and ethical obligations to protect the data and ensure their system is secure and failure to operate ethically and legally is a violation of customer trust (Cannon, 2002). Trust is essential is today’s marketplace. Consumers’ habits are changing and their patience is dissipating (Cannon, 2002). Companies need to respond to the changes in the marketplace by conducting business both legally and ethically to gain trust of existing and potential customers (Cannon, 2002). Many companies recognize that attracting new customers is more costly than retaining current customers and many are focusing on creating customer loyalty. Customers expect a company to operate legally and ethically and a company’s failure to comply with legal and ethical standards is self-defeating when building profitable relationships with clients. Database systems have enabled companies to build relationships with customers; but if the database system is not properly maintained and secured, customers may lose trust which increases customer retention. Reputation is difficult for an organization recover after a security breach. In addition, a company may face litigation for not conducting business in accordance with current laws. Conduction business within legal parameter in conjunction with ethical behavior is how an organization can build trust in relationships with customers. Creating a relationship with customers requires trust to reduce customer churn. References: Cannon, D. (2002). The ethics of database marketing: personalization and database marketing--if done correctly--can serve both the organization and the customer. (Business Matters). Retrieved from: http://www.allbusiness.com/marketing-advertising/affinity-marketing/203611-1.html#ixzz1YXKZt0nq http://www.allbusiness.com/marketing-advertising/affinity-marketing/203611-1.html Singer, N. (2011). Data Privacy, Put to the Test. Retrieved from: http://www.nytimes.com/2011/05/01 /business/01stream.html