These are some of the questions I have been asked while working in the heavily regulated financial services sector. This experience has taught me that introducing new regulation into an established business can be viewed as “forced change” and met with hesitation and nervousness. Change notoriously puts further pressure on people and processes. However, it can be used as an opportunity to re-engage areas of the business to communicate to customers and begin dialogue with the local regulators on new topics.
Here are some of my tips for making your journey to compliance smoother, and bringing people along on the journey:
- Understand what the regulation really means for people. Make sure you know your stuff. Start by reading up on what’s been published on the regulators’ website. Check whether your understanding of the regulation aligns with the client’s view and gain clarity on the change objectives. Due diligence can prevent hidden surprises. For UK FS regulation, read the FCA Business Plan 2018/19, which articulates the priority for the regulator in the year ahead and the variety of changes affecting financial services and the wider society.
- Early engagement with the people impacted. Engaging early and often creates confidence that the change is being properly handled. Bring the client along the learning journey. As you know more, share those findings and get the business involved in discussions, actions and decision. Have frequent and regular interactions to manage this.
- Put people at the centre of the change. You need to understand what the change means for the customer as well as employees. Do a Change Impact Assessment. By taking a people-focused approach, you understand the impacts of the change to specific parties, where there is likely to be resistance and what could cause the change to fail. Anticipating these factors and building them into your approach will increase your chances of successes and, once again, removes the chance of surprises down the line.
- Agree your communications strategy. How regularly should you communicate with the regulator? Monthly, weekly, hourly updates? How should these be done? Email, presentation or pigeon? What is going to be the key focus for meeting? Agree these upfront and ensure you align updates with project activities. Before going to the regulator, make sure your message is simple, clear and concise and the business is comfortable with the content.
- Don’t re-invent the wheel. Try to use existing compliant processes rather than creating new governance. This allows you to focus on technological solutions, which can create cost and time efficiencies for the business.
- No shortcuts! Always do the right thing and don’t attempt tactical solutions.
Regulatory change is difficult for all, however, simplifying where possible, having transparent conversations and bringing people on the journey with you can encourage success.