Executive Summary

This report is prepared to study the issue Facebook recently faces. It is in news because of the Cambridge Analytica data scandal in which the personal information of Facebook users have been improperly shared with Cambridge Analytica – a data mining and political strategy firm. When the scandal exposed the CEO and Chairman of Facebook, Mark Zuckerberg had to apologize publically for the data breach and said that it was a mistake made by Facebook for not designing a process to restrict third party developers to work on Facebook API. He also pledged to make changes in the design and reform the privacy policy. This study gives an understanding of loopholes in Facebook’s quality management system and how it could have been prevented if they have followed the theories of quality management gurus. By understanding different theories described by these gurus, a strong quality management system can be placed from the design stage itself. It also states that customer loyalty is a very important value which can be gained by continuous improvement in quality management system. A poor system result in loss of company reputation, customers and monetary value.

1.0 Introduction

Facebook is an American social media company providing social networking services to people around the world. It was founded in 2004. Mark Zuckerberg is the Chairman and CEO of the company. It has more than 2.2 billion active users. People use Facebook to stay connected to their friends and family and to share and express their views.

2.0 Issue of data breach

Recently Facebook’s data privacy scandal
came into limelight where Facebook members’ data were improperly shared with Cambridge Analytica, a data mining and political
strategy firm.  These data were accessed
during Donald Trump’s presidential campaign. Cambridge Analytica accessed the
data for more than 2 years. This is the biggest public relation crisis Facebook
has faced.

In April 2010, Facebook launched a
platform called Open Graph to third party apps. This allowed the external
developers to reach out to Facebook users and request permission to access
their personal data (CNBC, 2018).

In the year 2013, Cambridge University’s
researcher named Aleksandr Kogan created an App called “thisisyourdigitallife”. 
The app prompted users to answer questions for a psychological profile. About
270,000 people downloaded the ‘app’ and shared their personal information. This
gave Aleksandr Kogan to access data of not only Facebook users but also of the
users’ friends. These information were shared with Cambridge Analytica and used
to know about the personality of the people and to effectively target political
advertising on people. Cambridge Analytica obtained the information in total
violation of Facebook’s rule and didn’t tell anybody that the data will be used
for political campaigning.  (Casey, 2018)

In the same year Facebook was made aware
about this violation of accessing data of not only who installed this app but
also of their friends. Facebook demanded Cambridge Analytica to delete all the
data and they agreed to delete all the data. Aleksandr Kogan in reality never
deleted the data and later on Facebook never investigated whether they have
deleted the data as promised (Casey, 2018).

In 2014 Facebook changed their rules for
external developers and restricted them from accessing user’s friends’ data
without taking permission from them.

With the approaching 2016 Presidential
elections, Cambridge Analytica did not have time to create its own data for
election campaign. It went to Aleksandr Kogan who created Facebook app that
paid users to take a personality test (The Guardian,
2018).

In the year 2016 “The Guardian” reported that
Cambridge Analytica is helping Ted Cruz’s presidential election by sharing
psychological data based on their previous research. Facebook waited for more
than two years before suspending Cambridge Analytica even after knowing about
the data breach.  

In mid – March 2018, this scandal was
exposed by The Guardian and The New York Times.

Facebook admitted that it did not read the
terms of the app that accessed the data of 87 million people and apologised for
the “breach of trust”.  Facebook’s CTO
Mike Schroepfer told U.K. lawmakers that Facebook did not notify the U.K.’s data protection
watchdog after it learned of the sharing of data with Cambridge Analytica and
it was their mistake. (Ryan, 2018).

According to U.K.’s data protection law,
sale or use of personal data without user’s consent is banned. In 2011, after
Federal Trade Commission complaint, Facebook agreed to get clear consent from
the users before sharing their data. The FTC now started investing whether
Facebook violated privacy protection of their users. The U.S.A. and U.K.
lawmakers are investing in their own way. Mark Zuckerberg apologized on behalf
of Facebook by publishing a personal letter in all major newspapers and make
changes and reform the privacy policy to prevent such kind of breaches.

By doing this Facebook has breached the trust
of users and privacy policy law.  A
customer or user shares information with a company trusting that personal
details are safe. A company’s name and reputation makes people to trust on
them.  Quality of the brand is very
important in building and growing a company.

Facebook is a very well know networking
site and it has monopoly in the market. People joined Facebook and disclosed
their personal details knowing that whatever information they share about
themselves and their friends will be confidential and will not be disclosed
anywhere outside without their consent.

3.0 Referring to statements made by Quality management Gurus

It is very important for a company to have
a well defined quality management system in place. For a company like Facebook,
where the personal data of people are at risk, there is a continuous risk of
hijacking the data for misuse.

How a good quality management system can
be placed, has been described by many Quality management gurus. Mentioned below
are some of the points stated by these gurus:

According to quality management guru W. Edwards Deming there are seven deadly diseases that are described as barriers in understanding the basic quality management system statistical principals. One of the diseases says that – A company runs on visible figures only. Deming argued that apart from the visible figures there are many costs and figures that are not know and cannot be calculated.  Customer loyalties gained as a result of continuous quality improvement are the numbers that are unknowable and management has to consider this (Deming, 2012).

It is also very important to gain confidence of the customers by building trust. In case of Facebook data breach scandal, it was very important for the company to monitor and improve the system. Once Aleksandr Kogan accessed the data of the Facebook users and their friends, it was important for Mark Zuckerberg to monitor and improve the system putting a barrier for third party developers to access data. This would have resulted in maintaining the confidentiality of the users’ data.

Based on the quality management guru J M Juran’s trilogy, it is very important to plan, improve and control quality.

Quality Planning – A proper quality plan
should be in place. This involves creating a process that will be able to meet
the goals .Once the process is in place it will not be difficult to respond to
customer needs.

Quality Improvement – It is important to continuously
improve the quality and run the process with optimal effectiveness.

Quality Control – To control and maintain good quality it is important to create a process that required minimal monitoring. This will help in running the operations in accordance with quality plan (Juran, 1986).

Facebook should have
created a process to maintain the privacy of their users’ information. This
process should have barred the third party developers to run their app in
Facebook API.

Quality guru Genichi Taguchi emphasized on improving the quality of the product and process at the design stage rather than achieving quality through inspection. Taguchi also developed a concept of quality loss and worked on it rather than just quality.  He defined quality loss as loss to the company cost such a reworking on design, scrapping and maintenance and also loss to customer through poor product or service and low reliability. (Taguchi, n.d)

After the scandal exposed, Facebook has faced huge loss in terms of its reputation, breaking customers’ trust and monetary value. Many users deleted their Facebook    account feeling that their personal information are not secured and can be misused by the company.         

4.0 Conclusion

It is very important for a company to develop a quality system at its designing stage and to control and improve the quality system with minimal inspection requirement. It is also important to know and understand the unknown costs and figures like customer loyalty that can be gained by continuously improving quality. A proper system should be in place with zero defects. A poor quality management system will result in loss of reputation, customers and monetary value.

5.0 References:

(2018, March). Retrieved from The Guardian:
https://www.theguardian.com/commentisfree/2018/mar/19/facebook-data-cambridge-analytica-privacy-breach

(2018,
April). Retrieved from CNBC: https://www.cnbc.com/2018/04/10/facebook-cambridge-analytica-a-timeline-of-the-data-hijacking-scandal.html

Casey, N.
(2018, April). Retrieved from
https://www.theverge.com/2018/4/10/17165130/facebook-cambridge-analytica-scandal

Deming, E.
(2012, Janauary). Retrieved from https://www.qualitymag.com/articles/88324-quality-management-2-0-deming-s-7-deadly-diseases-of-management

Juran, J.
(1986, May). Retrieved from The Quality Trilogy:
http://app.ihi.org/FacultyDocuments/Events/Event-2930/Presentation-16071/Document-12762/Tools_Resource_C7_Juran_trilogy1.pdf

Ryan, B.
(2018, April). Retrieved from CNBC:
https://www.cnbc.com/2018/04/26/facebook-cto-admits-firm-didnt-read-terms-of-aleksandr-kogans-app.html

Taguchi, G.
(n.d). Retrieved from British Library: https://www.bl.uk/people/genichi-taguchi