2018 was always going to be the landmark year in which compliance goals, needs, and worries took center stage in global business. MiFID II, PSD2, GDPR, and many other acronyms have been dictating strategic discussions and preemptive planning across enterprises for years. Now we have arrived into the newly regulated normal, in which organizations of all sizes and mandates, from governments to universities to Facebook and beyond must manage the significant impact of increasingly widespread legislation on both their current margins and future prospects.
Although the need to meet legal requirements isn’t new, the difference today is that compliance needs to be embedded into decision-making at every level of business, whether as a formal department, a cross-functional committee, or an individual manager. Regardless of how it came to dominate discussions, the driving force behind this compliance focus has been largely fear. Regulatory violations, reputation damage, profit loss, fines of up to 4% of annual turnover — there are plenty of reasons to worry about compliance. Nearly as many as there are to embrace it.
The motivational value of compliance thus far has tended to be avoiding penalties and protecting reputations. However, compliance affords an important opportunity, if we choose to see it.
Recent advancements in enterprise technology solutions are enabling organizations to realize long-held process and efficiency goals, such as standardized data formats across finance and payroll, or smoother communication between HR and related functions. With compliance a likely beneficiary of those improvements, there has never been a better time to make your case for change.
Focus on Data
To understand how the concurrence of new regulations and technology can benefit your business, look at how they impact your data. While it’s easy to view data as a risk or even a weak point, it’s more important to recognize its value as one of your organization’s greatest assets. Global payroll data in particular contains a wealth of information and is one of the most validated, complete data sets available to any company. Leveraged correctly, payroll data can provide valuable insights into productivity, workforce management, and more. If we take a similar second look at other key data sources within an organization, it becomes clear that optimizing and understanding the data we store is just as important as protecting it.
Process standardization is key to accumulating better data, improving access, and deepening understanding of information across the organization. Many companies may be used to managing discrepancies across procedures that developed over time or in response to conflicting cultural or business needs, particularly within multinational enterprises or those that grew through acquisitions. However, in today’s increasingly regulated reality, that divergence is a liability.
Fortunately, it is also easily addressed with the latest technology, particularly with cloud-based systems. Whether for payroll, HR, accounting, or another core function, enterprise technology platforms deployed across locations provide a standard process and data format for companies. This lets you streamline processes within the same department in different countries, laying the groundwork for standardizing data management across functions. And when you’re ready to cross that data-standardization bridge, systems integrations and automation technology are there to help, compiling valuable data into the same or compatible formats to minimize risk of human error, speed data movement between functions, and support compliance.
Data visibility allows you to more readily identify issues as well as areas for improvement, whether that’s in how data comes into a system or in the processing done once it’s there. Some advanced platforms provide real-time visibility of your data so you can monitor movement and gain insight into any bottlenecks or blindspots in the process. Greater visibility translates into better security because you can see at any given point what is happening with your valuable data.
One benefit of improved data visibility that is central to both achieving and maintaining compliance goals is traceability: having a complete history and record of data movement, processing, and storage that identifies who did what with which data and when. Not only does it help internal teams understand how data is managed and how processes can be improved, but it can substantially impact your auditability as an organization. Such records can prove your fulfillment of regulatory obligations and adherence to legal requirements, and having all your data available on the spot, in a standardized and accessible format will help move the process along.
Advanced analytics can aid compliance by putting your data to use. What better way to stay on top of your data than by assessing it on a regular basis? Depending on the data and the analysis, companies can derive insights that inform anything from customer satisfaction and product development to employee productivity and workforce planning. And the more they access, analyze, and apply that data, the better they know it.
Businesses who regularly use analytics know what’s typical, what’s possible — and what’s off. Rather than relying on end-reports to see if a certain number or goal was achieved, these organizations track their data and processes in real-time in order to spot trends and identify opportunities for improvement. This puts companies in a position to catch and resolve errors as they occur, before they become a compliance liability or violation.
For the Future
By some analyst reports, as many as 80% of multinational companies will fall short of compliance obligations in 2018. Organizations can either worry about where they’ll fall or embrace the chance before them to improve their operations and ensure they belong in the compliant 20%. Opportunities for improvement abound, whether in global payroll, HR, finance, or another essential business function. The real challenge is translating compliance fears into motivation to make substantial changes to improve operations today and prepare for success into the future.
This blog was written for CloudPay, a global SaaS technology provider. View the original here.