Preparing for the Risky World of Extended Reality

XR, the reality-bending technology that will have many applications across industries, is still in its early stages. But leaders must strategize around implementation risks now.

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T.S. Eliot wrote that “humankind cannot bear very much reality.” Will it be any easier to bear with extended reality, with its high risks and potential rewards?

The development and use of extended reality, or XR — an umbrella term that encompasses virtual reality, augmented reality, and other technologies that blur the line between the real world and simulated worlds — has reached a tipping point. No longer will these technologies primarily serve as tools for gaming and other forms of entertainment. Consumer spending on XR is estimated to rise from $5 billion spent in 2018 to $40 billion in 2023 while industry spending outstrips it, surging from $4 billion to $121 billion in that period. And that investment will go toward a wide range of innovations, such as the ability to conduct remote surgery and training, and applications that will increase productivity on the factory floor.

As with other transformative technologies, like AI, the rapid uptake of XR demands preemptive vigilance. XR data is profoundly personal, raising heightened privacy and security concerns, while XR tools make direct connections to our mental faculties and perceptions of reality that are not yet fully understood. Missteps with these technologies risk harm to individuals and society that could be incredibly hard to reverse.

So there’s an urgency and a necessity to get this right from the outset. Because XR is not yet mainstream, few companies have designed responsible measures to prevent, or at least mitigate, potential negative consequences of the technology. As part of a research project with the G20 Young Entrepreneurs’ Alliance, Accenture identified six risks that business leaders can begin to strategize around now, while they’re still in the early stages of XR implementation.

1. Managing personal data. As we move into the next phase of extended reality, personal data will no longer just include people’s credit card numbers, purchase histories, and likes and dislikes on their social media networks. Personal data will mean everything that makes someone a person: feelings, behaviors, judgments, and physical appearance.

Researchers at the Institute of Ethics at Dublin City University and Dublin’s Insight Centre for Data Analytics are studying the potential effects of these trends in the next generation of social networking: virtual reality social networks, or VRSNs. In their view, people will be represented by avatars that can replicate everything they do in the real world in a realistic way. These networks will gather biometric data on detailed physical and emotional traits to replicate someone almost entirely.

Key considerations: Data responsibility is critical. How will the data you collect be stored, protected, and shared? For example, even when XR data can’t be connected to a specific individual, companies must be aware of how it could be combined with data from other sources to reveal the individual’s identity. Intended or unintended misuse of such intimate data must be a top-priority concern.

2. Fake experiences. The visual effect of Tom Hanks shaking hands with John F. Kennedy and Richard Nixon in the 1993 movie Forrest Gump required time and money. But with the advent of deepfake technology, you can easily and cheaply swap the head of one person onto the body of another. Adobe’s Project Cloak allows objects or people to be digitally removed from videos. Voices can be cloned from very short audio samples by Lyrebird or Baidu’s Deep Voice 3.

As these technologies proliferate, anyone will be able to make a convincing fake video to exert political influence or for other malicious purposes. We already know the effects of fake news. In a world where news is consumed through immersive video experiences, imagine how much easier it will be to influence opinions and behaviors with false information.

Key considerations: The entire workforce, especially leadership, needs to be vigilant to prevent fake information from being unintentionally spread or incorporated into decision-making. This demands cyber capabilities, as well as cultural and process considerations to prepare employees for new realities. Moreover, malicious attacks using false information must be factored into cybersecurity plans, as discussed below.

3. Cybersecurity. Just like with the internet, smartphones, and the social media networks that preceded it, XR will attract bad actors looking to exploit vulnerabilities for personal gain.

The more we rely on XR technologies to perform critical day-to-day tasks, the more vulnerable we become to malicious actors. Consider a surgeon whose work is interrupted by ransomware attackers who say, “We’ll turn the data back on when you pay us the money.” Or when workers on an oil rig or in a mine find their access to real-time information blocked. These scenarios could have disastrous or fatal consequences.

Key considerations: Malicious attacks in an XR environment can have life-or-death consequences. Organizations need well-developed emergency response plans and people with the expertise and capabilities to react immediately. Backup systems and contingency plans aren’t just about the cybersecurity team; they demand planning and action across the workforce, just as with fire and earthquake drills.

4. Tech addiction. An overdependence on technology can significantly harm our mental health and well-being. We see this today with video games and social media, as reported by the Royal Society for Public Health.

The World Health Organization now considers impaired control over gaming behaviors as gaming disorder, and research suggests that young people who are heavy users of social media are more likely to report poor mental health, including psychological distress and symptoms of anxiety. Further, the growing impact of social media and influencer culture can flaunt a superficially perfect lifestyle and promote so-called compare and despair attitudes.

With immersive experiences, the gap between what your life could be and what your life is will widen considerably. Neuroscientists are beginning to explore how extended exposure to virtual environments might affect mental health and social well-being, including conditions such as depersonalization/derealization disorder and dissociative identity disorder.

Key considerations: It’s a health and safety issue. As with a ladder or power drill, there is a correct way of designing and using XR technology. Consumers (including employees) need appropriate warnings and instruction, and designers and programmers need to consider the impact of misuse, whether intentional or unintentional.

5. Antisocial behavior. For most people, it’s harder to be rude to someone in person than over the web. But should our standards of acceptable behavior slip as our interfaces with others are further anonymized?

Today, online antisocial behavior such as trolling and cyberbullying is rampant. According to an Ipsos survey, almost 1 in 5 parents worldwide says their child has experienced cyberbullying.

Imagine a scenario in which a troll escalates from writing intimidating words on social media to physically intimidating his targets in a virtual world with an avatar. And now imagine the psychological effect of multiple trolls intimidating that one person. Worse still, consider how antisocial behavior that is normalized in a virtual environment can creep into real-world behaviors.

Key considerations: XR producers and creators must take note. We have yet to effectively deal with the rampant growth of antisocial behavior, trolling, and bullying online, let alone prepare for the deeper psychological and behavioral effects from XR. There seems to be evidence of a Proteus effect, where behaviors from the online world seep into the real world. Designers of virtual environments need to work with appropriate institutions to agree on practices and principles that guide and enforce acceptable behavior.

6. Widening social divisions. The more time we spend in artificial, “perfect” virtual worlds, the less time we spend in the real world — where very real problems exist. This makes it easier for us to disengage from real-world events and issues, reducing shared human experience and a common sense of purpose to address those problems.

Virtual environments are designed for specific purposes, such as education or entertainment. They do not include additional random, irrelevant, or undesirable details. Where is the pollution? The homelessness? Some XR applications can even overlay digital images of beautiful scenery outside a vehicle window or fun activities to distract children during a car ride. Everything in view is perfect. But it’s really not.

Key consideration: Society is only now examining how the internet and social media have transformed the way we interact with one another and the world around us. We need a deep examination of how we want XR products and environments to be designed. Ultimately, guidelines and principles need to revolve around how these tools can enrich our lived experience and protect against social division and harm. A key question: Who needs to join corporate leaders and XR designers in this conversation?

Three Core Principles to Guide Leadership Strategy

Extended reality technology is an inevitable, powerful, and tremendously valuable part of our future. But with such deep and long-term risks to corporate, individual, and societal well-being, leaders need to act now in preparation.

Comprehensive accountability: The buck stops with each of us. Research into how XR will interact with humans’ physical and mental health and affect individual and societal behaviors will increase in the coming years. But businesses can hasten this work by creating a culture of common-sense questioning rather than checklist compliance.

Technologists will have questions related to the design, building, and operation of tools. Strategy, marketing, and executive leadership will have questions related to brand and reputation. Compliance and legal leadership will need to understand ethical and procedural questions across the organization. And human resources and workforce leadership must deal with questions around employees and organizational culture. Organizations will need to use a collaborative approach so that different groups can understand and learn from one another, and their choices and decisions reflect common principles and a common language.

Wide-ranging expertise: Not just a business decision. The knowledge, experience, and skills needed to design and implement the right principles and guidelines for a world with immersive technologies aren’t contained in one organization; they’re spread across society.

That’s why experts like neuroscientists, sociologists, psychologists, and behavioral theorists must be consulted on decisions that can affect individual or societal well-being. At a minimum, getting a diverse group of professionals focused on exploring the implications of XR will inoculate companies from narrow or single-minded thinking.

Unbound imagination: The promise of human-machine collaboration. XR technologies break down the longtime constraints of distance, time, and infrastructure. Dazzling uses like remote surgery, virtual tourism, and entertainment will grab headlines, but business leaders need to open their minds to how these tools can be applied to transform everyday business activities. For example, many roles that are highly vulnerable to automation (such as those in warehouses, on assembly lines, and on factory floors) hold the greatest opportunity for XR-related upgrades — transforming jobs that are “at risk” into jobs of the future.

DHL, for example, is using augmented reality glasses to display order picking and placement directions for operators, freeing their hands and allowing them to work more efficiently. XR has helped the company boost average productivity by 15% while also improving accuracy. Workers can improve their judgment, decision-making, speed, and accuracy, and become more valuable to the workforce.

Before we know it, XR will be part of our daily lives and work. While there is still much to be learned about the potential risks of this world, business leaders can’t wait for perfect knowledge. It’s time to act now to proactively address the risks.



An MIT SMR initiative exploring how technology is reshaping the practice of management.
More in this series


Special thanks to Dave Light, Paul Barbagallo, Shruti Shalini, and Klayton Rocha of Accenture Research for their contributions to this article.

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akaash gupta
The information was very helpful. Keep writing such informative articles, It help us to understand many things. Good work. Keep writing.