The Price of HP's Spy Game

Thus far, Hewlett Packard's electronic eavesdropping scandal has had no negative impact on its stock price. Shareholders and Wall Street don't seem to care. Has the idea of tapping into someone's personal email and phone calls become that accepted, that mundane, that mainstream? Apparently.

You see, HP is hardly alone. Thousands of businesses use private investigators (that frequently use unethical or even illegal methods) to obtain information about job applicants, employees, competitors - even marketing alliances and channels partners. Management often tells these investigators to keep their information gathering techniques to themselves to protect it from liability.

If your company keeps houses individuals' personal information in large corporate databases, you might rethink what you're doing immediately. HP has stated that the techniques it used to discover the source of leaks were cleared by their attorneys. But management ignorance, as a defense argument, starts to crumble when the courts get involved.

Ignorance can also keep management in the dark about potential embarrassment, reputation damage or law breaking until it is too late, violating the "no surprise" rule every executive values.

If you're using subcontractors to investigate employees and others - look into their means. Even if what you're doing is legal, the price you pay for a damaged reputation if and when the activity becomes known can be high.

Remember that phase, all PR is good PR? Funny how you don't hear it anymore.