5 ways to minimize non-compliance
In today’s globally connected marketplace, not only is it easy to have a distributed organizational setup, but it is also the preferred way option. Availability of skilled labor, access to critical resources, cost arbitrage, ease of setting-up plants - there are multitudes of business-cases to “rightshore” various business processes. But, like all other guilty pleasures of life, this one too is not without a cog in the wheel; namely, ensuring compliance to all the regulatory requirements!
Now before you start judging, we are not suggesting that offshore operations do not comply with the regulations. Its just that the geographic boundaries, language barriers, time-zone differences, and jurisprudence dissimilarities, cultural nuances, and what not, tend to make it that much easier for non-compliance to creep into the system, and before you know it, you may have a federal inquiry at hand. Naturally, you need to minimize the chances of non-compliance. Below are 5 tried and tested strategies to do just that:
- Start your compliance adherence at the top: Most organizations that are high on compliance have created these standards by making it a strategic priority. The board and the management need to take it upon themselves to become the conduits of compliance in the company culture by embracing the core principles of compliance, and modeling that behavior in their everyday conduct, including their communication and interaction, both inside and outside the organization. If the staff is convinced of the management’s commitment to the compliance, they will have both intrinsic and extrinsic motivations to follow suit.
- Follow good documentation practice: Any document needed to fulfill a compliance requirement must be kept safe, and be readily available for inspection as soon as an authority requests it. This can include a host of documents, called ‘controlled documents’, starting from the time of the receipt of the raw material to the time of delivery of the final product. In addition, your internal auditors might also require you to safekeep your uncontrolled documents (internal documents that make daily operations easier, such as scheduling records, location sheets, status reports, etc.). The only possible way to keep track of every single document in this sea of paperwork is to follow good documentation practice, including indexing and cross-referencing, meta-tagging, following good naming convention, etc.
- Invest in automation: A key aspect of most compliance requirements is consistency, and to achieve that, organizations need to identify and rectify inconsistent internal controls. Best way to rectify inconsistency, or enforce consistency, is to make judicious use of automation wherever possible. Not only will the automation minimize the potential for human error, it will also help establish a document trail that identifies each step of the processes, making it easier for you to perform a root-cause analysis in case of an unfortunate product failure. And while you are at it, reflect upon your organization’s need to preserve the information integral to the business processes, and to free-up storage space from non-essential information, and automate your organization’s documentation retention and removal policy accordingly.
- Make the policy easy, make the policy known: Two most prevalent reasons for non-compliance within an organization are a) the target group is not aware of the compliance requirement and b) the target group is not able to comply with the rules. People cannot comply with regulations if they do not understand what is required, and the management, therefore, needs to communicate to the target groups their respective roles and responsibilities for the compliance, and ensure that all the necessary information is provided to the target group and other technical facilities on the mechanisms institutionalized to make the policy workable in practice.
- Focus on training: Your leadership might be the living embodiment of your commitment to compliance, you might have the best document control practices and your automation might be state-of-the-art, but if your employees are not trained on what it means to be compliant, you will achieve little success. Follow below mentioned guidelines to ensure that your staff is well-versed with compliance requirement:
- Gamification: Unfortunately, an average employee, given a choice, would rather do anything else than undergo compliance training, as it can be a real ‘drag’ to do so. Research has shown that building some fun game mechanics into the course can not only motivate your staff to undergo training, but will also help staff learn faster, and retain the knowledge longer.
- Include a ‘test out’ option: Your seasoned employees who have been around for a while might not get a lot of additional value from attending the same training every year. Such employees may be exempted from the training if they can demonstrate that they have the necessary information memorized and are following procedures properly.
- Build ‘modular’ course material by job type: if there is one thing that bothers us more than sitting through an entire session to get some meaningful information, its sitting through an entire session to get information you do not need. The answer? Modular course materials that use relevant scenarios in eLearning, and are available on-demand. If you can keep these modules short and crisp, all the better!
All said and done, compliance is not a destination, but a journey. There will always be new compliance requirements that your organization will need to adhere to – some of these will be easy to implement, while others might leave you in a state of uncertainty and not knowing what to do. Fortunately, we will always be around to help you find your way through your… wait for it… compliance quest. See what we did there?