How Data Organizations Can Evolve With the Web
The typical approach to customer data is reaching a point of diminishing returns for many organizations — companies have been accumulating as much data about customers as possible, but now find they still can’t discern what their customers truly want. Plus their customers increasingly distrust their data practices, and regulations are hyper-focused on data privacy and AI’s use of data.
At the CDOIQ Symposium in Cambridge, Massachusetts, Inrupt’s CEO John Bruce and Chief of Security Architecture Bruce Schneier provided a path out of this morass for enterprises and governments today. They described how data leaders can harness the latest web technology to create more trusted customer relationships and stay ahead of the competition.
Below, we share two important takeaways: First, the technologies that are rapidly changing the relationship between companies, customers and data. And second, how companies should evaluate and adopt such powerful new technologies.
How Data Wallets Transform Security
Under current data infrastructures, organizations must store and take responsibility for all of the customer data they use. They spend millions of dollars in securing their data, and are liable for any data breaches that may occur. These data breaches cost companies an average of $4.8 million, according to IBM, and can result in irreparable damage to customer trust and brand reputation.
“Data is a toxic asset,” said Bruce Schneier during the CDOIQ talk. “It’s dangerous to have.”
What if organizations could securely access customer data without being responsible for its storage and protection? Sir Tim Berners-Lee’s Solid Protocol makes this possible — by decoupling applications from data, it becomes possible to store data in a user-centric manner in personal Data Wallets.
Data Wallets extend beyond typical payment wallets to include other types of data. Organizations can then request access to a user’s Data Wallet — or to certain data within that wallet — for a limited period of time. Organizations ensure access to accurate, up-to-date information, and individuals gain enhanced transparency into how organizations process and use their data.
Data Wallets also create new avenues to ensure AI technologies are used safely and securely. An AI agent trained on data within a personal Data Wallet would be able to offer truly personalized recommendations, and a user would be able to ensure that all data used to train the AI was accurate and used with their consent.
Why Companies Struggle with Innovation
During the talk, Inrupt CEO John Bruce described a phenomenon he calls “reverse causality” — or the tendency of organizations to create an oversimplified narrative to explain their greatest successes. Simple, repeatable narratives might work to adopt faster and cheaper alternatives to existing tools, but they can’t help a company consider a big new opportunity. “Reverse causality” hinders an organization’s ability to come up with truly innovative solutions.
Organizations who solely embrace a linear approach to innovation would miss out on paradigm-shifting technologies like the World Wide Web. When Inrupt co-founder Sir Tim Berners-Lee invented the web, many enterprises did not understand how it could be used to drive business outcomes. Now, every organization relies on the web to connect with their customers.
Data Wallets represent a similar opportunity for organizations looking to create next-generation relationships with their customers and capitalize on consumers’ growing preference for using digital wallets. And Data Wallets built on a standardized protocol — such as Solid — unlock even more possibilities for interoperable services and data sharing.
