A Tale of Two Businesses
Consider the following scenarios. Two retail managers each have a chain of locations they are in charge of, with massive amounts of inventory across each chain. One relies on the store manager at each location to ensure that inventory levels are where they should be. So once per month they get a message from each store manager that essentially says “inventory is still good!”, and they leave it at that.
As it happens, most of the store managers haven’t actually checked their inventory beyond a cursory glance through the storeroom in at least six months. And known to them, several employees have been stealing inventory a little at a time.
One of the store managers actually does check their inventory once per month. However, the day after they last checked someone walked in and stole 60% of the inventory, leaving just enough of each item that the loss wouldn’t be noticed for a while. The next month the manager does their check, discovers the massive loss, and is fired on the spot. The other managers are then subjected to audits and their losses are also uncovered.
At this point it’s too late. Monthly checks, unsubstantiated by regular audits and left to trust, have led to the entire business going under just that quickly.
The second manager has all inventory barcoded and checked with scans every week, in addition to random audits throughout the month. Should anything go missing, they would be aware of it either in real time or within hours or days at most.
The rhetorical “which manager would you rather be?” question is silly to even ask. No business person in their right mind would subject their business to the risk of the the first situation. No business except the financial industry, that is.
Meanwhile in the Real World
Australian Financial Services License (AFSL) holders have for years relied on monthly or even annual attestations from their advisors and brokers confirming that they aren’t aware of any breaches. In light of the first scenario described above, this common practice seems almost ridiculous. It should seem obvious that real-time monitoring to ensure compliance across an enterprise must be the goal for any organisation that wants to survive and thrive.
Thankfully, pressure is now being out on organisations to implement compliance monitoring in the financial sector. In the modern business world being proactive instead of reactive is just common sense, but there are still areas where changing from old thinking to new has been slow if not resisted.
The Compliance Monitoring Solution
This paradigm shift has been made a simple task through modern technology, however, and emphasised by the increase in compliance regulations. It’s a blessing that these two things happen to complement each other. The idea of compliance as a necessary evil is slowly being replaced with the realisation that using compliance monitoring software for real-time auditing and information has relevant applications across every aspect of an enterprise, reducing unnecessary expenses and revealing areas where efficiencies can be implemented or enhanced.
Our own Compliance Checkpoint software has played its part in this shift in thinking, as shown in a case study discussed in a recent blog. The beauty of this type of example is that it demonstrates how the possibility of turning pain points into positives and expenses into revenue can be achieved regardless of business type or industry.
Compliance Experts provide clients with access to the Compliance Checkpoint Software Technology, which is complimented by our Professional Auditing and Consulting services. This is our unique point of difference. To learn more, visit our website or download the 30 Day Free Trial of Compliance Checkpoint.