Digital Identity

Chapter 1. Introduction

In medieval times, strong walls and moats surrounded great cities. Guards were posted at the gates of the city, and everyone coming or going was inspected and questioned about their purpose for entering or leaving the city. At the same time, cities were where the markets were held. You can imagine the crush at the gates on market day with peasants bringing their goods into the city from outside and visitors clamoring to get to market. After market was over, the process was reversed. With our modern eyes, we can see what an impediment to commerce the walls were, yet at the time, city residents were thankful for their security.

The walls were not broken down by enlightened thinking about of how markets should work, but rather a weapon for which the walls were no match: the trebuchet (see Figure 1-1). A trebuchet is a gravity-powered catapult that is vastly superior to its torsion-powered cousins. The trebuchet revolutionized medieval siege warfare and eventually spelled the end for city walls. The result not only forced an alternative strategy for security, but also had the pleasant side effect of increasing commerce.

I recently had the opportunity to sit with a group of CIOs and discuss digital identity. What struck me was how much of the conversation was about security and liability rather than identity and opportunity. They had a siege mentality and their security planning showed it.

Modern corporations are the walled cities of our time—sitting behind firewalls and defending themselves from attack. What these CIOs and others can't see is that their security implementations are restricting their company's opportunities in the same way that ancient walls restricted commerce in their day. Fortunately, commercial enlightenment, rather than a weapon that cannot be withstood, is awakening a desire in corporations to rethink how we provide security so that our interactions with customers, employees, partners, and suppliers are richer and more flexible.

Figure 1-1. Trebuchet

Business Opportunity

The economic shifts that have occurred over the last decade have changed how businesses operate and the expectations of customers. One of the most dramatic shifts has been the rise of network-based, automated services. In many cases, we're "spending more and owning less," in the words of Jeremy Rifkin. When I fly, I almost always purchase tickets online, but more than that, almost all of my needs as a customer of the airline are self-serviced, using online web applications. I can check flight schedules, be notified by SMS if my plane is running late, check my frequent flyer account balance, and even redeem upgrade points and change my seat online. The changes underlying these trends have profound implications for businesses and customers alike.

For businesses, a service-oriented economy means that they must adjust to entirely new ways of relating to their customers. The World Wide Web changed the way companies market their products. But more importantly, the products themselves have changed. Perhaps the most significant change is that there is no longer a human in the loop to create a trust relationship with the customer, make up for process deficiencies, and represent the company. When two businesses merge, they often find that they have very different approaches to knowing their customer and that this makes leveraging the combined operation almost impossible.

For customers, the changes are equally dramatic. Where they used to purchase things from people at physical locations, they now purchase or use services delivered to them electronically on their computer, PDA, and even their phone. The usual trust marks that customers have relied on in the past are either missing or easily forged. As the number and breadth of services that people use grows, they find that they are inundated with requests to identify themselves and to divulge information they consider private.

In addition to their customers, businesses have relationships with partners, suppliers, and employees. Networks have changed those relationships as well. Just as with the business-customer relationship, these relationships are increasingly moving to the electronic world and being mediated by automated processes rather than people.