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Sep 09, 2021
5 min read

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“Compliance is a journey, not a destination”

In life you have to expect the unexpected and your Compliance Management software implementation is no exception.

Implementing a new Compliance Management solution is an inherently complex and often a challenging project. A combination of capable and experienced vendor coupled with careful planning and meticulous execution are critical success factors.

Compliance officers often think of such implementations as IT projects. However, several key factors often get overlooked. Here are key items to keep in mind as you embark on the digital journey.

Executive Sponsorship

Going Digital transforms the way your organisation approaches governance, risk and compliance. It paves the way to enhanced transparency, accountability and information empowerment. It takes away the capability to make excuses and manage information access and flow. Executive leadership is one of the key beneficiaries of digitising compliances. It helps them provide the required certification to the board as per the Companies Act, 2013.

It often throws unpleasant surprises when it flags serious delays and non-compliances. The capability to ‘manage’ information access and flow is thwarted. In many organisations, this means a serious change in the way they govern themselves.

Executive leadership needs to be on-board for this transformation to be successful. They need to set the right tone at the top and link it with management’s key result areas. It helps create a culture of compliance in the organisation.

Readiness to adopt new technology

New technology is often met with skepticism. Whether it’s fear of the unknown, lack of resources or understanding, this can be a roadblock to successful long-term use of compliance management software. Issues surrounding ad-hoc, paper based and people dependent compliance program and the incumbent risks should be communicated. The benefits of digitisation in enhancing efficiency, productivity should be presented broadly to the stakeholder group.

It is important to ensure that the target user community is taken into confidence.

Lack of a Multidisciplinary team

Compliance cuts across departments. Every department in every location has responsibilities for specific Acts and Compliances. However, there is hardly any homogeneity in their processes and approach to compliance management and reporting. When you try to deploy a software solution across your organisation, it is important to standardise processes and reporting protocols.

A cross functional, multidisciplinary project team can help to build common processes across geographies, entities, businesses and departments.

You operate in multiple geographies (States / UTs / Cities)

In India there are multiple bodies which govern the compliance obligations of an enterprise. Central Government, State Governments, Union Territories, Local Governments. As the number of locations increase, the complexity increases exponentially. As a result, the expertise requirements also sharply increase. In most cases, organizations do not have the required in-house expertise to manage all the compliances.

Competing priorities

Too much to do and not enough time. However, with the right compliance management software, you can save a significant amount of time by automating manual processes. The repetitive, mundane tasks such as frequent follow ups, report preparation, status tracking, search for applicable legal updates can be completely automated.

It is important to prioritise this project, fund it right and allocate the right resources to see it through.

Culture of Compliance

Different organisations operate at different levels of maturity in their compliance management programs. There is a class of organisations in India where Compliance management is considered a second fiddle to business and revenue growth. Senior executives believe that they can ‘manage’ inspections, enquiries, notices and litigation by resorting to underhand practices. In such organisations, there are hardly any standard protocols or processes to track and manage compliance. As a result, the ‘culture of compliance’ is weak and practices are ad-hoc at best.

They often wake up from their slumber when they get swamped with legal notices, severe financial penalties and board reprimands. In such cases, management tries to scramble to solve the problem by applying temporary patches to douse the fire.

This attitude often prevents an organisation to take a step back and solve it right rather than temporary mitigation measures

In Conclusion

As they say, ‘well begun is half done’. Implementation of the right software is the first step towards defining and standardising common processes and protocols across the organisation. Software should not be expected to solve all your compliance risks and issues overnight. Digitisation helps to bring the right focus and visibility. It is important to believe that your organisation will be able to manage all the roadblocks with ease.

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