Partner Article

Risky business online?

Managing risk is at the heart of a successful business as it grows. But what are the risks posed by the online space? They all depend on where you sit on the SE/CE Curve – the balance between Social Engagement and Corporate Experience.

We see businesses at every point of their online development, from confident users to reluctant and cautious non-users. Their behaviour fits a consistent pattern – often age-related, as the older you are the less likely it is you had access to computers as a child! The specific risks at every stage can be defined and managed.

Strongly Corporate

Many established owner-managed businesses sit at the Corporate end, where the people involved don’t tend to use social media much personally, and are experienced enough to be conscious of all the potential risks and pitfalls – ‘loose lips sink ships’.

Staying away from the unpredictable, dynamic, spontaneous online world can seem like the safest path, but in ignoring the very place where more and more customers engage, the business is running a risk by not keeping up with the market. Here, risk management involves developing confidence and an understanding of how the internet can help to build a business, and maintain or increase market share.

Strongly Social

At the opposite end lies a more traditional risk. Young entrepreneurs embrace the online space as they are more familiar with day to day communication online than they are with writing or even telephoning. Young staff members in an established business will have the same preference. Often, this high level of social engagement is matched by a low level of corporate experience.

The risks here are potentially more serious: getting the legal framework right is paramount. Making sure that online communication complies with a raft of legislation including the Companies Act 2006, The Data Protection Act 1998, The Companies (Trading Disclosures) Regulations 2008, The Privacy and Electronic Communications (EC Directive) Regulations 2003 and The Electronic Commerce (EC Directive) Regulations 2002 is essential. Managing staff who are using email and social media calls for formal policies to cover any HR issues and security considerations, and an awareness of changing employment law and the scope of the Equality Act.

A Balanced Perspective

Half way through a full career, someone in their mid-forties will have significant corporate experience and an appreciation of the classic risks to a business. This age group is also the very tip of the scale of regular online social engagement – for clear historical reasons. In 1982 we saw the advent of BBC computers in schools and the ZX-81 and ZX-Spectrum arriving in many homes; in 1993 the internet truly opened for business, with Compuserve in the ascendance and emails starting to make headway as a communication tool. Over 50? Computers will not have figured at school, and working patterns will have been strictly off-line for many years. Under 40? Computers would have been used in general teaching at school, and you’d have started work with emails as a standard tool of the trade. The mid-forties are the grey area where cultures collide.

Where do YOU sit on the SE/CE curve? Your position will help you decide what risks to address to build your business safely online.

This was posted in Bdaily's Members' News section by Kate Baucherel .