Demonstrating Compliance

August 29, 2016

Process Tempo is the perfect solution for demonstrating regulatory compliance. Why? Auditors look very closely at how things interconnect. They are keenly interested in understanding the flow of information from start to finish and to validate the business is compliant every step of the way.

 

Today, most businesses struggle with demonstrating compliance. This is because the business itself is very complex and the tools they use to untangle this complexity are not designed for this. A knee jerk reaction is to flood auditors with process flows and spreadsheets which amount to pretty pictures and raw, mostly useless data. Auditors want to to see action plans, they want to understand the day-in-the-life, they want to understand cause and effect. They want to perform scenario testing. Static pictures and disconnected data do not allow them to do this.

 

Spreadsheets and flow diagrams have time and time again failed to produce the requisite information that auditors seek. Just ask the compliance teams at some of the larger banks. These institutions are routinely fined very large sums of money for failing to demonstrate compliance. Their tool of choice has been the spreadsheet. Something has to change.

 

Introducing a new approach: The Process Tempo Blueprint.

 

The Process Tempo Blueprint is just that: a schematic that describes how the different  parts of the business interconnect. For an auditor a Blueprint can demonstrate how the business has adapted to reflect a given regulatory requirement. It draws a clear, definitive line between a given obligation down to the people, processes and technologies that are affected by this obligation. Exactly what auditors look for.

 

In this (overly simplified) Blueprint I have documented the components an auditor will be looking to understand. At the top of the Blueprint is the regulation itself. Connected to it is the Owner (the Compliance Team) and the documentation that pertain to this regulation (Reference). These aspects are critical for auditors. In reality many of the concepts in this Blueprint would have both Documents and Owners assigned to them.

 

 

 

Next a carefully laid out chain of command and control helps Auditors understand the approaches taken. The Regulation itself is broken down into Obligations which could also be titled "Legal Obligations". These are the components of the regulation that the Legal team has determined require action by the business. Each Obligation will have a policy attached to it. The policy further describes how the business plans to comply with each obligation.

 

Attached to each policy is the procedures (or processes) the business implements to reflect adherence to this policy. This is where the rubber hits the road per se. The auditors will be able to see what actions are being taken and by whom to make sure the business is compliant.

 

Lastly a line is drawn to the actual products and or services that ultimately will be impacted by this regulation. Where a line cannot be drawn today, a project can be attached to demonstrate implementation of a given procedure for compliance in the future.

 

Keep in mind that the image I attached to this blog post is a representation of a high-level map with many sub-maps behind it. Inside Process Tempo this data is interactive and queryable. Auditors will be able to ask questions of this data. This is a far cry from flow diagrams and spreadsheets! An example may be "Show me what procedures you have implemented to meet this requirement and what products are affected?" With Process Tempo you can perform a simple query and get the result in sub-seconds. 

 

In the future, if one asks "Why do we do it this way?" This Blueprint will allow them to trace a given process to the regulation itself. This example is fairly simple but given a multitude of complex regulations the ability to answer this question and those like it will be a critical benefit to the organization.

 

 

 

 

 

 

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