Analysis of Facebook's Cambridge Analytica Data Scandal

This paper analyzes the Facebook's Cambridge Analytica Data Scandal, discussing the issue, its significance, and the company's actions.

Running head: MANAGEMENT
Management
Topic: Analysis of hot topic in corporate strategic management
Unit Name: Strategies for Growth and Excellence
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction:...............................................................................................................................3
Company Profile:.......................................................................................................................3
Elaboration of the Issue:.............................................................................................................4
Significance of the Issue:...........................................................................................................5
Evaluation of the firm’s actions:................................................................................................6
Conclusion:................................................................................................................................6
References:.................................................................................................................................8

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Introduction:
The evolution of the social media is able to incorporate considerable number of
positives in the modern life styles and that has influenced the human society in such a manner
that their presence in various forms of social media has become significantly necessary.
However, along with the positives, the introduction of the social media is able to provide a
significant scope to the cyber frauds for conducting fraudulent activities1. The paper analyses
one such case of unethical practice that relates one of the largest social media platforms
named as Facebook. The paper discusses regarding one of the hot topic of the corporate
world which is Facebook’s Cambridge Analytica Data Scandal. Along with this, the paper
includes a brief description of Facebook. In addition to this, the paper identifies the issue,
evaluates the significance of the issue and along with that, the paper analyses the response of
the company as well.
Company Profile:
As mentioned earlier, the company operates in the social networking service industry
and was founded in the year 20042. The company is currently headquartered in Menlo Park
and serves across the world. The company is currently managed by Mark Mark Zuckerberg
the CEO and Chairman of the company, Sheryl Sandberg, the COO of the company, David
Wehner, the CFO of the company and the CTO of the company, Mike Schroepfer3. As a
result of the visionary leadership of the team, the company is bale to acquire 55.838 billion
US dollars as revenue in the year 2018 and along with an operating income of 24.913 billion
US dollars in the same year4.
1 Aljazeera.com 2019. "Cambridge Analytica And Facebook: The Scandal So Far". Aljazeera.Com.
https://www.aljazeera.com/news/2018/03/cambridge-analytica-facebook-scandal-180327172353667.html.
2 Facebook.com. 2019. "Facebook – Home". Facebook.Com. http://www.facebook.com.
3 Facebook.com. 2019. "Facebook – Home". Facebook.Com. http://www.facebook.com.
4 Facebook.com. 2019. "Facebook – Home". Facebook.Com. http://www.facebook.com.

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Elaboration of the Issue:
Facebook’s Cambridge Analytica Data Scandal is one of the classic cases of unethical
practices that are conducted with the help of the social media and through violating the data
privacy. The case portrays the fact that the social media and the personal information stored
in it can be unethically used through intentionally violating the data privacy policies of
Facebook. The co -founder of a data firm named as Cambridge Analytica and later
recognized as one of the significant whistle blowers of the case, Christopher Wylie claimed
that Cambridge Analytica illegally achieved the data of approximately 50 million Facebook
users for intentionally tampering or influencing the political results5. On the 17th of March,
2018, New York Times revealed the fact that Cambridge Analytica which is a UK based firm
gathered the personal information of more than 50 million Facebook users for developing a
software that has the potential to target the swing voters in political campaigns and one of the
prominent application of the same was the Donald Trump’s election bid for the position of
the US President in the year 20166. The mentioned organization gathered the data with the
help of an application named as “thisisyourdigitallife”7. A Russian- American researcher
named of Cambridge University named as Aleksandr Kogan was at the heart of the events.
With the help of such huge database, the company was able to develop 30 million
psychographic profiles for designing manipulative political advertisements8. Two days later,
on 19th, a video footage got published where the executives along with the CEO of
5 Alphr.com 2019. "Cambridge Analytica And Facebook: What Happened And Did The Company Shift Many
Votes?". Alphr. https://www.alphr.com/politics/1008854/cambridge-analytica-facebook-what-happened.
6 Cnbc.com 2019. "Here's Everything You Need To Know About The Cambridge Analytica Scandal". CNBC.
https://www.cnbc.com/2018/03/21/facebook-cambridge-analytica-scandal-everything-you-need-to-know.html.
7 Aljazeera.com 2019. "Cambridge Analytica And Facebook: The Scandal So Far". Aljazeera.Com.
https://www.aljazeera.com/news/2018/03/cambridge-analytica-facebook-scandal-180327172353667.html.
8 Aljazeera.com 2019. "Cambridge Analytica And Facebook: The Scandal So Far". Aljazeera.Com.
https://www.aljazeera.com/news/2018/03/cambridge-analytica-facebook-scandal-180327172353667.html.

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Cambridge Analytica were observed to have the idea of entrapping politicians with bribes
and other ploys9. Wylie was observed to accept the fact that pro Brexit campaigners that were
linked with the company, cheated in preparing for the referendum, which was the base of
leaving European Union.
Significance of the Issue:
With a precise understanding of the case, it is visible that the impact of the mentioned
unethical practices have the capability to negatively influence the people in a negative
manner. The incident of the data leak in one of the largest social media platform, has raised
considerable amount of the concerns amongst the people across the globe as the executives of
Facebook were unable maintain the privacy of their stored data10. However, several
executives at Facebook claimed that the customers themselves agreed to pass their
information to the Cambridge Analytica. Having said that, the privacy policies of Facebook
were unable prohibit the mentioned data firm from illegally acquiring the information of the
friends of a Facebook users11. Hence, it allowed the data firm to conduct such an unethical
activity which not only favoured certain individuals in an illegal manner but also created
considerable amount of concern amongst the Facebook users in storing their personal
information in Facebook. The incapability of the privacy policies of the company in stopping
the illegal exchange of the data to the third parties placed the organization in front of
significant amount of reputational damage.
9 Wong, Julia. 2019. "The Cambridge Analytica Scandal Changed The World – But It Didn't Change Facebook".
The Guardian. https://www.theguardian.com/technology/2019/mar/17/the-cambridge-analytica-scandal-
changed-the-world-but-it-didnt-change-facebook.
10 Theguardian.com 2019. "The Cambridge Analytica Files | The Guardian". The Guardian.
https://www.theguardian.com/news/series/cambridge-analytica-files.
11 Wong, Julia. 2019. "The Cambridge Analytica Scandal Changed The World – But It Didn't Change
Facebook". The Guardian. https://www.theguardian.com/technology/2019/mar/17/the-cambridge-analytica-
scandal-changed-the-world-but-it-didnt-change-facebook.

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Evaluation of the firm’s actions:
Facebook’s actions in this issue, were notably criticized. At the initial stages,
Facebook tried to avoid the issue by saying that the customers themselves provided their
information to the data firm. However, after investigating the way in which Kogan’s used the
app to collect the data, it was pretty prominent that the privacy policies of Facebook were
unable to prohibit the collection of friend’s data of the users and the data collected can be
easily sold to third parties12. As a result, Facebook came under the scrutiny. In addition to
this, the mentioned social media service providers were unable to alert their users regarding
such a significant misconduct so that they be able to secure their private information13. At the
same time, Facebook removed the app created by Kogan, however, Facebook did not suspend
the data firm for their unethical practice. This contributed into the formation of a significant
amount of frustration amongst the people across the globe. Having said that, the CEO, Mark
Zuckerberg was observed to publicly apologise for the data leak in several US and UK
newspapers where he called it as a breach of trust14.
Conclusion:
On a concluding note, it is visible that the case of Facebook’s Cambridge Analytica
Data Scandal is one of the widely debated topics across the world. The case is considered as
one of the dark spot of the services offered by one of the largest social media service
providers, Facebook. Though there are considerable number of guilty parties involved in the
cases such as the Cambridge Analytica or AggregateIQ, however, as a reputed organization,
12 Nast, Condé. 2019. "How Cambridge Analytica Sparked The Great Privacy Awakening". Wired.
https://www.wired.com/story/cambridge-analytica-facebook-privacy-awakening/?verso=true.
13 Vox.com 2019. "The Facebook And Cambridge Analytica Scandal, Explained With A Simple Diagram".
Vox. https://www.vox.com/policy-and-politics/2018/3/23/17151916/facebook-cambridge-analytica-trump-
diagram.
14 Bbc.com 2019. "Facebook-Cambridge Analytica Scandal - BBC News". BBC News.
https://www.bbc.com/news/topics/c81zyn0888lt/facebook-cambridge-analytica-scandal.

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Facebook had the necessity to improve their data privacy policies for protecting the unethical
exchange of the data of their customers. The activities of Facebook after the case broke out,
also showed the reluctance of the company in protecting the customer data and that invited
considerable amount of reputational damage for Facebook.

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References:
Aljazeera.com 2019. "Cambridge Analytica And Facebook: The Scandal So Far".
Aljazeera.Com. https://www.aljazeera.com/news/2018/03/cambridge-analytica-facebook-
scandal-180327172353667.html.
Alphr.com 2019. "Cambridge Analytica And Facebook: What Happened And Did The
Company Shift Many Votes?". Alphr. https://www.alphr.com/politics/1008854/cambridge-
analytica-facebook-what-happened.
Bbc.com 2019. "Facebook-Cambridge Analytica Scandal - BBC News". BBC News.
https://www.bbc.com/news/topics/c81zyn0888lt/facebook-cambridge-analytica-scandal.
Cnbc.com 2019. "Here's Everything You Need To Know About The Cambridge Analytica
Scandal". CNBC. https://www.cnbc.com/2018/03/21/facebook-cambridge-analytica-scandal-
everything-you-need-to-know.html.
Facebook.com. 2019. "Facebook – Home". Facebook.Com. http://www.facebook.com.
Nast, Condé. 2019. "How Cambridge Analytica Sparked The Great Privacy Awakening".
Wired. https://www.wired.com/story/cambridge-analytica-facebook-privacy-awakening/?
verso=true.
Theguardian.com 2019. "The Cambridge Analytica Files | The Guardian". The Guardian.
https://www.theguardian.com/news/series/cambridge-analytica-files.
Vox.com 2019. "The Facebook And Cambridge Analytica Scandal, Explained With A
Simple Diagram". Vox.
https://www.vox.com/policy-and-politics/2018/3/23/17151916/facebook-cambridge-
analytica-trump-diagram.

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Wong, Julia. 2019. "The Cambridge Analytica Scandal Changed The World – But It Didn't
Change Facebook". The Guardian.
https://www.theguardian.com/technology/2019/mar/17/the-cambridge-analytica-scandal-
changed-the-world-but-it-didnt-change-facebook.