Changing the Perception of Compliance
RegTech has long promised to change this landscape. By 2022, an estimated $76bn is forecast to be spent on RegTech globally, up from $10.6bn in 2017. New solutions are beginning to have a fundamental impact on the way businesses see compliance.
At the center of this is how compliance is adjusting its cost-to-income ratio, with savvy firms fighting to make the most of early uptake.
And surprisingly for some, compliance is emerging as a key battleground in the quest for competitive advantage.
There are three areas upon which organisations are capitalising:
1. Changing the Cost-To-Income Ratio
RegTech and automation have the ability to replace low-value manual chores. This enables staff to spend time focusing on higher-value activity, making better decisions more efficiently. There are plenty of examples of this in compliance, but let’s take what we do at Recordsure as an example of AI analytics and automation in traditional compliance processes.
In audits, for instance, a big part of the potential for automation lies in carrying out the chores someone has to undertake when they review customer interactions and written correspondence. Using conventional manual processes, up to 90% of an analyst’s time can be spent simply organising files and structuring data.
Not only is this a huge time burden on a team but it is low-skilled work which is being undertaken by highly skilled staff.
This is a prime area that can now be automated, giving reviewers more time to focus on the areas which genuinely require their expertise, and speeding up processes by 90%. This means firms can reduce the cost of remediation projects and past business reviews by up to 60%, freeing up a budget which can be invested elsewhere.
2. Driving Customer Care and Brand Reputation
Compliance data provides invaluable insights for customer care. Once you harness this information you’re able to identify important segments within your audience. You can recognise vulnerable customers who might need additional support, or spot issues before they develop into complaints.
As well as being a big win for customers, working with this information brings huge benefits commercially. If you’re doing it and doing it well, you have the power to use customer care as a differentiator.
Quite simply, treating your customers well is good for business. Companies with good customer care naturally tend to gain good reputations as a result. This helps retain good customers and attract new ones.
On the other hand, failing in customer care risks more than frustrated customers. The underlying causes of poor customer care are often closely tied to regulatory shortcomings. Get it wrong and it can swiftly become a compliance issue, which risks regulatory audits, fines, and highly damaging publicity. Installing a robust RegTech infrastructure helps protect against these risks and safeguards your brand’s reputation from major controversies.
3. Honing Sales Messaging and Training
The information you can gather from customer interactions isn’t just significant from a compliance perspective, it’s also valuable for sales teams. Gauging a customer’s reaction is essential for sales, and AI now enables business development teams to understand not only what customers are saying, but how they are saying it.
This equips sales teams with a powerful tool to gauge what messaging is most effective and what is failing to hit the mark. It makes it possible to identify cross-selling and upselling opportunities at scale, and it provides macro insights that no single individual would be able to access.
Analytics like this also helps salespeople to self-review their work, with team leaders able to gain a quick understanding of how their team is getting on. You can showcase what a great conversation looks like and revolutionise training with real-life examples from your most productive team members.
The Shifting Role of Compliance
Compliance officers will always be responsible for ensuring compliance and doing so as cost-effectively as possible. While that is never going to change, they are now able to rely on technology to change the cost-to-income ratio for the better.
Costs can now be reduced through automation. Analytics can provide important customer care support. Commercially valuable sales assets can be identified to directly help increase revenue. And with all this in mind, it is the innovative firms who will benefit the most, by racing to press their advantage through early adoption.