Can hacking be good for us?

Dropbox – the cloud storage supplier – has been hacked. To be more precise, it’s just been reported that up to 68 million usernames and passwords were stolen back in 2012. Now, that’s a statement which probably bemuses the reader on two points; firstly, the scale of the breach, and secondly, the speed of the news – that’s 4 years ago. In fairness, the company made it known that they had been compromised in 2012, but the size of the incident had apparently been underestimated.

It’s said that Dropbox was completely unaware of the full extent of the attack, which leaves me in a flux – exasperated by their state of oblivion, while being gently encouraged by the fact that nothing has changed. As a Dropbox user (Darn, have I compromised myself?), I read the story with an air of resignation in light of the increasing regularity of such breaches – not just at Dropbox, I hasten to add. However, there lies the nub of the issue – my lethargic response, which is no doubt shared by others, is indicative of the consumer mindset that these attacks are a corporate problem and subsequently need corporate solutions. Not so, as corporate stakeholders we are all part of the problem and the solution. Specifically, the public’s attitude towards passwords is casual at best, with our encryption bordering on an ‘open door’ policy – Pass 1234 anyone?

Hack fatigue would appear to be setting in among the public, leaving them perilously indifferent to the issue. So what to do? In entering the spirit of Sydney’s Festival of Dangerous Ideas, maybe we need the castle defences to be brought down occasionally to best appreciate our enemy's strengths, and give priority to investing in bigger and better walls. Only when we have a full grasp of the impact, will we recognise the threat.

A Soldier's Guide to Managing Uncertain Times

Firstly, let me apologise for not being strong enough to withstand the pull of the Brexit black hole. It was out there and reams have been written and will continue to be written, but not by me I said. Well, that was my position, but I have succumbed.

However, if any respite can be offered, this is no place for the micro, or macro-economic, or further speculation about Scottish independence. No, in what sounds like an Absurdist argument, I’ll try to flesh out the challenges of organisational uncertainty.

What with the disruptive nature of technology, the lingering legacy of the GFC and the widespread rejection of mainstream party politics, It’s been said (by far too many) that we live in uncertain times, and now the UK’s decision to leave the European Union has exacerbated the sense of limbo being felt by corporates and consumers.

So, how best for corporate leaders to manage this ‘fog of war’? Fittingly, I believe military thinking to be an invaluable starting point. To expand, former CIA Director and General, David Petraeus once spoke of his frustrations of live fire arms exercises within the US Army, which were too “carefully scripted” and resultantly lost any spontaneity – you can read more here. I hasten to add that I don’t endorse executive team shoot-outs, but I believe there’s much to be learnt from an unannounced simulation exercise for team members. Clearly, such sessions are carefully choreographed and planned behind-the-scenes, but participants should very much feel ‘down in the deep end’. In extending another of Petraeus’ thoughts, it’s also vital that these exercises are now far more inclusive of more middling and junior ranked employees. To Petraeus’ words, the “decision making needs to be pushed outwards and downwards, towards where new information is originating.” Those more junior members of the team have, for instance, for more affinity with the subversive nature of technology; they know what it can do and have less in the way of reverence for those institutions that stand to lose, or gain from its application.

The military factor should also be explored by way of the war game - a cornerstone of combat strategy for the past 200 years. In contrast to the conventional simulation, the exercise is far more adversarial in nature, with your executive decision makers lining up against a team of competitive adversaries in terms of a given scenario, where every action is met by a reaction. Again, this is about leaders having to take the initiative and manage uncertainty actively.

By our very nature, we as rational animals, look to make decisions based on information; we put off difficult choices by requesting more information, and in an age of big data, there’s no shortage of content to turn to. However, there lies the potential for even greater paralysis and the overriding paradox of the Information Age. The statistics are useful, but let’s not lose sight of the need for strong instinctive leadership. 

Johnson & Johnson's Baby Powder Blues

Johnson & Johnson’s widely praised response to a product tampering crisis in the early Eighties has been long held-up as the pinnacle in effective reputation management. You can read a lot more here.

I mention the business as they are back in the news last week; The Australian’s ‘J&J hit with $170 million damages in talc cancer cases’ headline captures the situation rather bluntly. To summarize, separate juries in the United States awarded two women a total $127 million (USD) in damages as the company’s iconic baby powder was deemed to have been to blame for the plaintiffs developing ovarian cancer.

The story throws up a number of intriguing points; firstly, the legal system’s effect on the notion of truth. Absoluteness in terms of the facts is becoming a lot harder to attain when subjected to the vagaries of a court process; for instance, two courts found for the women, while a third (in 2013) decided the firm was negligent, but didn’t award damages. However, all of this stands in contrast to the company’s “thirty years of medical expertise” which supports the powder. Secondly, there’s the question of who best to rebuild trust in the product among consumers? Typically, this sort of assurance would be offered by appropriate health professionals; generally, doctors. For many, though, such figures are seen as a little too close to industry; part of the problem, as opposed to the solution, possibly. So, would this fall more comfortably within the realm of celebrity endorsement – a discerning mother figure seen elbow-deep in the white stuff? You get the gist. Lastly, the case highlights the importance of external agencies to support organisations over the long-term with such issues. Specifically, it is alleged that Johnson & Johnson “was concerned about the association between talcum powder and ovarian cancer…since the Seventies”. If that was the case (and it’s a big ‘if’), it’s vital to have a agency in place to manage the issue – the matter can be transplanted to a suitable host to carry out all the required pre-crisis preparedness that’s critical for these occasions. Such work can’t be done with any great satisfaction inside the business due to the inherent politics, and the sensitivity of the matter invariably gets in the way of having a full-blown planning strategy – the ‘hush hush’ effect is not good for engendering trust within an organisation, so why not have the matter managed and nursed off site?  

Why not let the army handle the Sydney siege?

The coronial inquest into the 2014 Sydney siege at the Lindt Café, which led to the tragic death of two hostages heard how the Australian Army had contacted the NSW Police and offered their assistance to best resolve the situation. The offer was turned down to the apparent dismay of some within police ranks – you can read more here.

Clearly, the situation is a hugely difficult one involving high-pressure judgments, but in light of the fact that army commandos had actually carried out an exercise in the vicinity of the siege, only a month earlier and have far more experience of combat in close-quarters than their police counterparts, why didn’t the police cede control?

Well, there lies the clichéd $64 million question and as is usual with a drama of many moving parts, the reasons are undoubtedly, many. One unnamed ADF (Australian Defence Force) source talked of “police pride” getting in the way, which unsurprisingly won’t be substantiated by the police. What can’t be argued, however, is the way such an approach – had it been taken up – would have been perceived by the public. Quite simply, as laymen, we put the army on a higher footing in terms of brute force than we do the police, as they have the scale in weaponry to justify such a notion; greater firepower though means greater threats. It would be a brave political leader to order the troops on to the streets of Sydney when the country was not at war. The impact on such images around the world would seriously damage the tourist revenue stream.

Yet, if the aim of the inquest is to get to the truth and apply some painfully learnt lessons to ensure the future safety of Australian citizens, it’s only right that we explore the army option more fully. Firstly, are we not already at war? Malcolm Turnbull has talked recently of broadening the war against terrorists, while predecessor, Tony Abbott’s readily referenced the threats to national security posed by terrorism. If that’s the story, why not keep to it? Secondly, the Coalition Government is viewed by the public as the most trusted to handle national security, so why not go the full ‘nine yards’ and leave them with a reminder they’ll find hard to forget?

As the tourist operators and the politicians know, the answer is fear. We may be able to render greater control through the army, but their presence would be greatly unnerving to the public. Fear is an incredibly powerful emotion, which tends to stay in our memories for an inordinate amount of time, which is no accident. Daniel Kahneman in his fantastic, ‘Thinking, Fast and Slow’ details the dominance of negative outcomes over positive ones in human psychology. As he says, “threats are privileged above opportunities, as they should be.” Fear is closely aligned to these threatening feelings. The respected Lowy Institute recently revealed that only 24% of Australians feel “very safe” – you may question the definition, but you get the gist; relatedly, the think tank also found the majority of respondents – 55% of Australians – believed the country’s participation in fighting ISIS only increased the risk of terrorism at home. As Kahneman also knows very well, statistics offer a far more accurate rendition of reality than the way we feel. The chances of us being the victims of terror groups are unbelievably slim; however, as political leaders know, our emotions get in the way and if the people are feeling scared, political change will undoubtedly follow.