23 November 2014

Trust Decisions: The Future State of Risk Management...

Trust Decisions are being made at the speed of light.  The rules of the game are embedded in lines of code written to instruct computers and simultaneously in the rule of law that is printed in Constitutions around the globe.  As the speed of Internet commerce accelerates the Operational Risk Management (ORM) frameworks will evolve and adapt.  The privacy vs. security evolution is now in full debate as our Critical Infrastructures feel the stress of points of failure.

The future architecture of what is at stake continues to be challenged in so many ways.  Jeffrey Ritter sums this up perfectly:
"Yet, in either direction, freedom vs. surveillance, what are being proposed are nation-state rules. At this point in the Net’s evolution, any national solutions seem almost contradictory to the ambitions of any government to actually be effective in achieving their ambitions. The inherent functionality of the Net is to “route around failure”. Nation-state rules that impose restrictions on the market’s appetite to create economic pricing tiers merely drive commercial activity into other geographic regions. Laws requiring backdoors have the same effect, provoking and encouraging bad actors to find mechanisms that avoid such technology features to be baked into the relevant devices. In a global market where, as one economist observed, there will soon be no further emerging economies, what is the proper role of the nation-states toward the Net? When do new regulations, well-intentioned to provide positive qualities of life, actually become walls that divert the movement of information, funds, and economic activity to other geographic regions?"
As the governance of the Internet continues to be debated, consider the velocity of what is occurring even as broadband and wireless are still so scarce in many locations around the world:
Alibaba Group Holding Limited is a Chinese e-commerce company that provides consumer-to-consumer, business-to-consumer and business-to-business sales services via web portals. It also provides electronic payment services, a shopping search engine and data-centric cloud computing services. 
Alibaba's consumer-to-consumer portal Taobao, similar to eBay.com, features nearly a billion products and is one of the 20 most-visited websites globally. The Group's websites accounted for over 60% of the parcels delivered in China by March 2013, and 80% of the nation's online sales by September 2014. Alipay, an online payment escrow service, accounts for roughly half of all online payment transactions within China.
The "Trust Decisions" being made every day by citizens of the planet Earth using the Internet continues growing exponentially.  The systems-of-systems are executing the rules given to them and the human element is beginning to diminish.  Why?

Most people believe in some form of risk management and the truth is, that it doesn’t work all the time.  It doesn’t work because the human being is incapable of processing all of the possible rules of the moment, the game, in any specific scenario, fast enough.  Therefore, failures of people, processes, systems and external events seem to occur randomly.

Is it possible to achieve a state of zero surprise?  Where all risks are mitigated and humans can achieve an environment of trust that is sustainable.  We think it is.  In the right environment and in a specific scenario, surprise is now “impossible”.

“Trust Decisions” occur today at the speed of light and with an accuracy of 99.999%.  Risk Management is our current state and it is destined for extinction.  Trust Decisions as we will now apply them, becomes our future state.  With zero surprise.  The truth is, that risk management is obsolete and a new digital invention is ready for mankind.

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