Course Name : Management IS for Leader

(ISYS6181)
Year : 2018

Ethical and Social Issues in

Information Systems

Session 9&10
 LEARNING OUTCOME

• LO 2 : Identify various strategies to

achieve organizational competitive
advantage for IS leader
 Acknowledgement

These slides have been

adapted from
Laudon & Laudon (2015)
Essentials of Management
Information Systems, 12th
edition, Chapter 4
 LEARNING OBJECTIVES

After reading this chapter, you will be able to answer

the following questions:
1. What ethical, social, and political issues are raised by
information systems?
2. What specific principles for conduct can be used to
guide ethical decisions?
3. Why do contemporary information systems technology
and the Internet pose challenges to the protection of
individual privacy and intellectual property?

https://kasperspiro.com/2011/09/25/make-e-learning-work-outcome-learning-4-the-developers-perspective/
 Sub Topics

1. Ethical, social, and

political issues are
-2. Ethical decisions
raised by information
systems

3. Challenges to the
protection of
individual privacy and
intellectual property
 1. Ethical, social, and political issues
are raised by information systems

• Recent cases of failed ethical judgment in business

• Barclay’s Bank, GlaxoSmithKline
• In many, information systems used to bury
decisions from public scrutiny
• Ethics
• Principles of right and wrong that individuals, acting
as free moral agents, use to make choices to guide
their behaviors
 1. Ethical, social, and political issues
are raised by information systems

• Information systems and ethics

• Information systems raise new ethical questions

because they create opportunities for:

• Intense social change, threatening existing

distributions of power, money, rights, and
obligations

• New kinds of crime

https://bhrllc.wordpress.com/2013/07/31/carf-standards-for-written-ethical-codes-of-conduct/
 1. Ethical, social, and political issues
are raised by information systems

A Model for Thinking About Ethical, Social, and

Political Issues

• Society as a calm pond

• IT as rock dropped in pond, creating ripples of new

situations not covered by old rules

• Social and political institutions cannot respond

overnight to these ripples—it may take years to
develop etiquette, expectations, laws

• Requires understanding of ethics to make choices

in legally gray areas
 1. Ethical, social, and political issues
are raised by information systems

The Relationship Among Ethical, Social, Political

Issues in an Information Society
The introduction of new
information technology
has a ripple effect, raising
new ethical, social, and
political issues that must
be dealt with on the
individual, social, and
political levels. These
issues have five moral
dimensions: information
rights and obligations,
property rights and
obligations, system
quality, quality of life, and
accountability and
control.
 1. Ethical, social, and political issues
are raised by information systems

Five Moral Dimensions of the Information Age

1. Information 2. Property 3.
rights and rights and Accountability
obligations obligations and control

4. System 5. Quality of
quality life
 1. Ethical, social, and political issues
are raised by information systems

Key Technology Trends That Raise Ethical Issues

 Doubling of computer power

• More organizations depend on computer systems for
critical operations
 Rapidly declining data storage costs
• Organizations can easily maintain detailed databases
on individuals
 Networking advances and the Internet
• Copying data from one location to another and
accessing personal data from remote locations are
much easier
 1. Ethical, social, and political issues
are raised by information systems

Key Technology Trends That Raise Ethical Issues

 Advances in data analysis techniques

• Profiling
• Combining data from multiple sources to create
dossiers of detailed information on individuals
• Nonobvious relationship awareness (NORA)
• Combining data from multiple sources to find
obscure hidden connections that might help
identify criminals or terrorists
 Mobile device growth
• Tracking of individual cell phones
 1. Ethical, social, and political issues
are raised by information systems
Nonobvious Relationship Awareness (NORA)

NORA technology can take information about people from

disparate sources and find obscure, nonobvious relationships.
It might discover, for example, that an applicant for a job at a
casino shares a telephone number with a known criminal and
issue an alert to the hiring manager.
 2. Ethical Decision

• Ethical analysis: A five-step process

1. Identify and clearly describe the facts.

2. Define the conflict or dilemma and identify the higher-order

values involved.

3. Identify the stakeholders.

4. Identify the options that you can reasonably take.

5. Identify the potential consequences of your options.

 2. Ethical Decision

Basic concepts for ethical analysis

• Responsibility:
• Accepting the potential costs, duties, and obligations
for decisions
• Accountability:
• Mechanisms for identifying responsible parties
• Liability:
• Permits individuals (and firms) to recover damages
done to them
• Due process:
• Laws are well known and understood, with an ability to
appeal to higher authorities
 2. Ethical Decision

Candidate Ethical Principles

• Golden Rule
• Do unto others as you would have them do unto
you.
• Immanuel Kant’s Categorical Imperative
• If an action is not right for everyone to take, it is
not right for anyone.
• Descartes’ Rule of Change
• If an action cannot be taken repeatedly, it is not
right to take at all.
 2. Ethical Decision

Candidate Ethical Principles (cont.)

• Utilitarian Principle
• Take the action that achieves the higher or
greater value.
• Risk Aversion Principle
• Take the action that produces the least harm
or potential cost.
• Ethical “No Free Lunch” Rule
• Assume that virtually all tangible and
intangible objects are owned by someone
unless there is a specific declaration
otherwise.
 2. Ethical Decision

 Professional codes of conduct

• Promulgated by associations of professionals
• E.g., AMA, ABA, AITP, ACM
• Promises by professions to regulate themselves
in the general interest of society
 Real-world ethical dilemmas
• One set of interests pitted against another
• E.g., right of company to maximize productivity
of workers versus workers right to use Internet
for short personal tasks
 2. Ethical Decision

Some Real-World Ethical Dilemmas

 Using information technology to reduce size of

workforce

• Voice recognition software

 Monitoring workers activities on the computer

 Facebook sells access to users’ newsfeed based on

personal information users subscriber information
to advertisers
 3. Challenges to the protection of individual
privacy and intellectual property

Information Rights: Privacy and Freedom in the Internet Age

 Privacy:
• Claim of individuals to be left alone, free from
surveillance or interference from other individuals,
organizations, or state. Claim to be able to control
information about yourself.
 In the United States, privacy protected by:
• First Amendment (freedom of speech)
• Fourth Amendment (unreasonable search and
seizure)
• Additional federal statues (e.g., Privacy Act of
1974)
 3. Challenges to the protection of individual
privacy and intellectual property

 Fair information practices:

• Set of principles governing the use of information
• Basis of most U.S. and European privacy laws
• Restated and extended by FTC in 2009 to
provide guidelines for behavioral targeting
• Used to drive changes in privacy legislation
• COPPA, Gramm-Leach-Bliley Act, HIPAA
• Two major divisive issues
• Opt-in policy
• National Do-Not-Track lists
 3. Challenges to the protection of individual
privacy and intellectual property

 FTC FIP principles:

• Notice/awareness (core principle)
• Web sites must disclose practices before
collecting data.
• Choice/consent (core principle)
• Consumers must be able to choose how
information is used for secondary purposes.
• Access/participation
• Consumers must be able to review, contest
accuracy of personal data.
• Security
• Data collectors must take steps to ensure
accuracy, security of personal data.
• Enforcement
• Must be mechanism to enforce FIP principles.
 3. Challenges to the protection of individual
privacy and intellectual property

Internet Challenges to Privacy:

o Cookies
• Tiny files downloaded by Web site to visitor’s hard drive.
• Identify visitor’s browser and track visits to site.
o Super cookies (Flash cookies)
o Web beacons (Web bugs)
• Tiny graphics embedded in e-mail messages and Web
pages
• Monitor who is reading e-mail message or visiting site
o Spyware
• Surreptitiously installed on user’s computer
• May transmit user’s keystrokes or display unwanted ads
o Google services and behavioral targeting
 3. Challenges to the protection of individual
privacy and intellectual property

How Cookies Identify Web Visitors

 3. Challenges to the protection of individual
privacy and intellectual property

Technical solutions
 E-mail encryption
 Anonymous browsing tools
 Cookie prevention and management
 Browser features
o “Private” browsing
o “Do not track” feature
 For the most part, these solutions fail in to
prevent users from being tracked from site to
site

http://technastic.com/5-reasons-use-vpn/
 3. Challenges to the protection of individual
privacy and intellectual property

Property Rights: Intellectual Property

 Intellectual property: intangible property of any kind
created by individuals or corporations
 Three main ways that intellectual property is
protected
• Trade secret: intellectual work or product belonging
to business, not in the public domain
• Copyright: statutory grant protecting intellectual
property from being copied for the life of the author,
plus 70 years
• Patents: grants creator of invention an exclusive
monopoly on ideas behind invention for 20 years
 3. Challenges to the protection of individual
privacy and intellectual property

• Challenges to intellectual property rights

• Digital media different from physical media
(e.g., books)
• Ease of replication
• Ease of transmission (networks, Internet)
• Ease of alteration
• Difficulty in classifying software
• Compactness
• Difficulties in establishing uniqueness
• Closed environments (Amazon, Kindle)
• Digital Millennium Copyright Act (DMCA)
 3. Challenges to the protection of individual
privacy and intellectual property

Accountability, liability, control

• Computer-related liability problems

• If software fails, who is responsible?
 If seen as part of machine that injures or harms,
software producer and operator may be liable.
 If seen as similar to book, difficult to hold
author/publisher responsible.
 What should liability be if software seen as
service? Would this be similar to telephone
systems not being liable for transmitted
messages?
 3. Challenges to the protection of individual
privacy and intellectual property

System quality: data quality and system errors

 What is an acceptable, technologically feasible

level of system quality?
• Flawless software is economically unfeasible.
 Three principal sources of poor system
performance:
• Software bugs, errors
• Hardware or facility failures
• Poor input data quality (most common source of
business system failure)
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
Ever get the feeling somebody is trailing you on the Web,
watching your every click? Do you won- der why you start seeing
display ads and pop-ups just after you’ve been searching the Web for a
car, a dress, or cosmetic product? Well, you’re right: your behavior is
being tracked, and you are being targeted on the Web as you move
from site to site in order to expose you to certain “targeted” ads. It’s Big
Data’s dark side.
Individual Web sites and companies whose busi- ness is
identifying and tracking Internet users for advertisers and marketers are
collecting data on your every online move. Google, which handles more
than 3.5 billion Web searches each day, knows more about you than
your mother does. Many of the tracking tools gather incredibly personal
infor- mation such as age, gender, race, income, marital status, health
concerns (health topics you search for), TV shows and movies viewed,
magazines and newspapers read, and books purchased. In 2015, a
$50 billion dollar online ad industry drove this intense data collection.
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
Facebook, which maintains detailed data on over 1.4 billion
users, employs its Like button to follow users around the Web even if
you log off, tracking what you and your friends like. Google’s many
different Web services know about your friendships on Gmail, the
places you go on maps, and how you spend your time on the more
than two million websites in Google’s ad network.
While millions of Web users are installing ad and cookie
blocking software, new technologies like so- called canvas
fingerprinting are able to track people online. While tracking firms claim
the information they gather is anonymous, this is true in name only.
Scholars have shown that with just a few pieces of information, such as
age, gender, zip code, and mar- ital status, specific individuals can be
easily identified. Moreover, tracking firms combine their online data with
data they purchase from offline firms who track retail store purchases of
virtually all Americans. Here, personal names and other identifiers are
used.
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
Use of real identities across the Web is going mainstream at a
rapid clip. A Wall Street Journal examination of nearly 1,000 top Web
sites found that 75 percent now include code from social net- works,
such as Facebook’s “Like” or Twitter’s “Tweet” buttons. Such code can
match people’s identities with their Web-browsing activities on an
unprecedented scale and can even track a user’s arrival on a page if
the button is never clicked.
In separate research, the Journal examined what happens
when people logged in to roughly 70 popular Web sites that request a
login and found that more than a quarter of the time, the sites passed
along a user’s real name, email address, or other personal details to
third-party companies. Online advertising titans like Google, Microsoft,
and Facebook are all looking for ways to monetize their huge
collections of online behavioral data. While search engine marketing is
arguably the most effective form of advertising in history, untargeted
banner display ad marketing is highly inefficient because it displays ads
to everyone regardless of their interests. As a result, these firms cannot
charge much for display ads.
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
However, by tracking the online movements of 260 million U.S.
Internet users, Web sites can develop a very clear picture of who you
are, and use that information to show you ads that might be of interest
to you. This would make the marketing process more efficient and more
profitable for all the parties involved.
You’re also being tracked closely when you use your mobile
phone to access the Internet, visit your Facebook page, get Twitter
feeds, watch videos, and listen to music. The mobile Web is working
hard to keep track of your whereabouts, locations, habits, and friends in
the hope of selling you even more products and services. Mobile
advertising is less effective than Web-based marketing because
advertisers cannot place cookies on your smartphone.
New technologies found on smartphones can identify where
you are located within a few yards. Performing routine actions using
your smart phone makes it possible to locate you throughout the day, to
report this information to corporate databases, retain and analyze the
information, and then sell it to advertisers.
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
Most of the popular apps report your location. Law
enforcement agencies certainly have an interest in knowing the
whereabouts of criminals and suspects. There are, of course, many
times when you would like to report your location either automatically or
on your command. If you were injured, for instance, you might like your
cell phone to be able to automatically report your loca- tion to the
authorities, but what about occasions when you don’t want anyone to
know where you are, least of all advertisers and marketers?
Location data gathered from cell phones has extraordinary
commercial value because advertising companies can send you highly
targeted advertisements, coupons, and flash bargains, based on where
you are located. This technology is the foundation for many location-
based services, which include smart- phone maps and charts,
shopping apps, and social apps that you can use to let your friends
know where you are and what you are doing. Revenues from the global
location-based services market are projected to reach $10.3 billion in
2015, according to Gartner.
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting..(Page 164-165)
In 2014, Google earned $12 billion from its mobile ads.
Smartphone apps that provide location- based services are also
sources of personal, private location information based on the
smartphone GPS capability.
New software is being developed to help advertis- ers track
users across devices by establishing cross- screen identities. That
means that companies will be able to serve ads to your mobile phone
based on what they learned about you from surfing the Web on your
PC, at the office or at home.
Behavioral tracking and targeting of ads is about to get a boost
from the Internet of Things, the connected set of billions of sensors on
machines and worn by individuals. Google looks at your searches and
mail, Facebook logs and tries to understand your social behavior, and
iPhone and Androids track your physical location. Increasingly, cars,
thermostats, and refrigerators will be tracking your movements as well.
Sources:
 Interactive Session: People
Big Data Gets Personal: Behavioral
Targeting ..(Page 164-165)

After Read the Interactive Session, answer the

following questions :
1. Why is behavioral tracking such an important ethical
dilemma today? Identify the stakeholders and interest
groups in favor of and opposed to behavioral tracking.

2. How do businesses benefit from behavioral tracking? Do

people benefit? Explain your answer.

3. What would happen if there were no behavioral tracking

on the Internet?
 Session 11 & 12 Preparation

Bring your Laptop for doing Group Exercise

(at least 1 group 1 laptop)
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