As government regulations and industry standards become increasingly stringent, many firms – especially professional services firms – are under pressure to ensure they operate in a compliant and legal manner. Failure to comply with these regulations and requirements may have serious consequences for the company, including heavy fines, negative public perceptionlegal action and business interruption.

Historically, compliance and risk management was a manual process where teams meticulously tracked, updated and verified compliance metrics and standards. Unfortunately, the margin for human error is large and can leave the company open to significant risk. The solution lies in workflow automation systems. By using automated systems to track, monitor and complete regulatory and compliance tasks, companies can improve their ability to stay compliant with current standards.

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1. Process standardization

Manual processes are one of the leading causes of regulatory and industry compliance failure. This is especially true for companies that have multiple employees who perform different tasks in slightly different ways. Implementation of one automated workflow process enforces consistency and uniformity by standardizing processes across the organization. With each task performed within the confines of the workflow systems, the company has more control over team members who may cut corners or deviate from the complaint process.

2. Reduction of human error

In many cases, compliance and regulatory violations are unintentional or malicious. Even the most diligent employees can make mistakes from time to time. Unfortunately, when it comes to compliance, even small, innocent mistakes can have big consequences, including hefty fines or legal action. Automation can reduce the risk of human error by taking over routine and repetitive taskssuch as data entry, which is prone to manual errors.

3. Regulatory Updates and Alerts

Regulatory requirements are constantly changing. Nearly two-thirds of business owners admit they struggle with complying with compliance regulations. It can be challenging to track and implement these changes, leaving the organization out of compliance. Industry-specific workflow automation systems can be programmed to automatically integrate regulatory updates as they become available. For example, tax accounting firms typically use software that updates to the latest formats available from the IRS.

These tools can also provide real-time monitoring of leads compliance issues and provide system alerts. This allows compliance issues to be addressed before they become a major problem, ultimately avoiding a fine or other consequences.

Related: 3 ways businesses are staying ahead of regulatory changes in 2024

4. Audit protection

Highly regulated businesses are often required to maintain a strong repository of important documents such as permits, financial records, employment contracts, regulatory filings and other legal agreements. Mismanagement of these important documents can lead to serious consequences if they are lost or cannot be accessed during an audit.

Automated workflow systems can simplify document management organizing, reporting and archiving all the necessary documents in a systematic way. The best part is that digital documents can be backed up and are not at risk of permanent loss in case of flood or fire.

5. Compliance Reporting

In many cases, companies are required to submit or publish documentation to regulatory agencies or the public. This can be a time-consuming process. In addition to saving important documents, automated workflow tools can also leverage system data to help generate these reports instead of completing them manually. This can reduce the risk of submitting inaccurate or incomplete reports to regulatory agencies.

6. Data Security Compliance

One of the fastest growing areas of compliance is data security, especially with the advancement of tools such as artificial intelligence. Numerous governments and agencies around the globe have developed standards and requirements around how sensitive and private information should be stored and handled, particularly regulations such as GDPR and HIPAA. Manual processes and human handling can expose data to unauthorized access or breaches, leading to compliance breaches.

Most automated workflow platforms come equipped with the latest built-in security features such as encryption, user authentication and access controls to help protect sensitive data and comply with data protection regulations. data.

Related: The 5-step guide to navigating legal and regulatory changes in business

Workflow automation systems are transforming the way businesses manage risk and compliance. The downside is that governments and regulators understand the power of these systems, which may encourage additional complex regulations in the future. It is critical for organizations to start implementing these systems so they can stay ahead of the curve. As regulations continue to evolve, using automation will be key to protecting your business against any regulatory or compliance risks.