A Guide to Compliance Automation: Tools and Strategies

If your organization relies on manual processes to review transactions, compile reports, and track regulatory updates, it will struggle to keep up with complex and frequently changing regulations. Errors will be frequent, response times will be slow, and there is a heightened risk of costly fines. Compliance automation can save the day, helping your company to continuously monitor transactions, detect anomalies, and generate real-time compliance reports. 

A case study conducted by a student at Cornell University showed that compliance process automation reduces manual effort by 73%. Compliance automation prepares you for audits by industry regulators. You have verifiable logs and policy documentation, so regulators will find no violations and may even praise your proactive approach to data governance. 

This blog post takes a deeper look at compliance automation to help you make an informed decision for your organization.

What is Compliance Automation?

Compliance automation means using advanced technologies like machine learning, artificial intelligence, and software to enforce regulatory requirements across a company’s operations automatically. The software continuously tracks regulatory changes, flags policy violations, and produces accurate compliance reports to help organizations stay compliant. You shift from a reactive to a proactive approach and take initiative instead of merely responding to events. 

Compliance laws and regulations are always evolving, and automation ensures your organization keeps up with changing laws, significantly minimizing errors, inefficiencies, and regulatory penalties.

Why is compliance automation important for businesses?

Compliance automation turns a regulatory burden into a competitive advantage. When you integrate compliance into your company’s daily workflows, you boost operational efficiency and data transparency. This leads to faster and more informed decision-making. Your compliance officer doesn’t have to endlessly chase regulations, the automated system adapts instantly to changing laws and regulations.

Let’s say you have a healthcare startup, and you start using automation software to track HIPAA data access. The system will automatically block employees who try to access patient information without proper clearance and instantly alert the compliance officers. This will prevent breaches before they happen and prove control during audits. With compliance automation, your company will avoid getting in trouble and become future-proof.

The need for compliance automation

Manual compliance processes don’t cut it anymore. They are error-prone, slow, and consume a lot of resources. Compliance process automation helps your business stay ahead by updating processes as laws change, preventing costly violations and penalties. Compliance checks are always consistent and accurate, and compliance officers have time to focus on higher-value work, like identifying emerging risks and building stronger risk frameworks.

Key Components of Compliance Automation

Compliance automation software isn’t created equal. Consider these must-have features to ensure you choose a solution that helps your organization stay compliant:

1. Compliance framework

A compliance framework provides the foundation upon which automation operates by outlining the regulations, internal policies, and industry standards a company must follow. An automation tool uses the framework to align systems with regulatory requirements and flag violations.

2. Monitoring

An automated compliance tool must continuously monitor business systems, processes, and controls to ensure continuous adherence to internal policies and industry regulations. This allows companies to detect policy violations, anomalies, or non-compliance issues quickly.

3. Risk management

Manually tracking risks in spreadsheets is time-consuming, error-prone, and resource-intensive. It’s also difficult to scale the processes fast enough to keep your business safe. A compliance automation solution monitors key risk indicators in real time, streamlining risk assessments. Your businesses can apply risk controls consistently as regulations or threats evolve.

4. Audit automation

Compliance automation software automates the entire audit process. It automates evidence collection and continuously monitors compliance status, instantly flagging potential issues or anomalies before they become audit problems. The software embeds compliance checks into daily operations, ensuring compliance without manual intervention. With compliance automation, your organization will continuously be audit-ready and reduce the manual workload.

5. Evidence collection

An automated compliance tool ensures you don’t spend time collecting evidence from different tools and organizing it. It automatically collects, organizes, and stores compliance evidence, creating a single source of truth for compliance. All evidence is readily accessible in one place, significantly speeding up audits. Auditors can quickly retrieve the information they need without back-and-forth requests.

6. Employee training

Most laws and regulations, including HIPAA, SOC 2, and PCI DSS, require companies to conduct employee training to bring their workforce up to speed on security and privacy best practices. Compliance automation software can automate compliance training, saving organizations a lot of time. Remember, your automated compliance system is only as effective as the people who use it.

Benefits of Compliance Automation

By harnessing the power of automation, your company can transform how it manages compliance and start using it as a strategic advantage.

Implementing compliance automation offers many benefits; here are several:

1. Reduced Compliance Risks

A compliance automation tool reduces risks by continuously monitoring your systems for vulnerabilities, detecting issues before they escalate, and resolving them. This proactive approach lowers the chances of your business being fined for non-compliance. The time it takes to resolve compliance issues can make the difference between paying a hefty fine or not.

2. Improved efficiency

Manual compliance processes waste a lot of time and are prone to errors. When people get tired, they make mistakes, and even your most experienced employee can overlook a critical compliance task or policy detail. Automation eliminates human error and streamlines compliance workloads. All compliance officers have to do is ensure the automated systems follow company policies, investigate anomalies, and initiate corrective actions.

3. Real-time data processing

Manual compliance processes involve tracking different programs or spreadsheets, and it’s hard to get a clear picture of your company’s compliance posture. Compliance software automates manual tasks like risk assessments, evidence collection, and control evaluations, helping companies easily keep up with laws and regulations. Less time is spent on audits, and adherence to industry standards becomes seamless.

4. Enhanced visibility

Automation gives your compliance team a sweeping view of the organization’s compliance ecosystem. They can monitor internal servers, third-party vendors, and even nth parties. A central dashboard shows who accessed what data, the policies triggered, and the violations that occurred. An automation tool offers a real-time view of all compliance-related activities, helping your company easily track, audit, and respond to risks.

5. Better business planning

Compliance automation software provides real-time insights into regulatory risks, operational gaps, and resource needs, giving organizations a clear, centralized view of their compliance landscape. They can track regulations for efficient resource allocation and make informed decisions about process improvements, business expansion, and product launches. Companies that use compliance data for strategic intelligence plan for growth with greater confidence and agility.

Standard Process of Compliance Automation

If you’ve decided compliance automation is right for your organization but aren’t sure where to start, use our step-by-step guide to get it right. 

1. Review your existing compliance program

Assess your current compliance program to determine the scope for process automation. Next, find out the requirements of the regulations you need to comply with. For example, to become HIPAA compliant, you must focus on patient data security and management. A gap analysis will help you identify the compliance areas you need to automate.

2. Choose the right automation tool

Pick a tool that integrates seamlessly with your systems and supports relevant regulatory requirements. Integration allows the software to access all key data for compliance monitoring. It centralizes data for easier access, analysis, and reporting, improving the accuracy of compliance processes. Data collection and analysis are also important features to consider. 

Atlas Systems takes the hard work out of compliance by automating monitoring, reporting, and risk detection. Get a demo today to get started.

3. Conduct employee training

Overlooking employee training is a recipe for disaster. Train your staff to make them aware of compliance regulations and automation’s role in enforcing them. Compliance officers should know how to use the compliance automation tool effectively. You can also conduct role-specific training to help employees understand how compliance relates to their job roles.

4. Perform an internal audit

This is the litmus test that will help evaluate the efficiency of your automation system. An internal audit checks the risks covered, if controls are functional, and whether reports are accurate. It provides data-driven insights that can be useful in making informed decisions about compliance improvements. 

5. Monitor results and adapt

Once you’ve set up your automated system, track its efficacy to ensure it’s helping you achieve your compliance goals. Automation may require periodic revisions due to changes in the regulatory landscape, ‍internal operations, and technologies. Perform regular internal audits to identify new areas ripe for automation and remove ineffective functions.‍

Compliance Automation Tools and Technologies

Compliance automation solutions enforce compliance processes by continuously monitoring systems, providing real-time oversight, and alerting stakeholders to non-compliance. These are the top compliance automation tools and technologies

1.Governance, Risk, and Compliance (GRC) Platforms

GRC platforms like ComplyScore® by Atlas Systems help organizations automate their governance, risk, and compliance processes. They provide features such as compliance tracking, risk management, audit management, and policy management for real-time visibility and control.

1. Audit management tools

These solutions help companies streamline and automate their audit processes, providing functions like risk assessment, audit planning, and reporting. They help organizations prepare for audits, execute them, and report on them efficiently. 

2. Robotic Process Automation (RPA)

RPA tools automate human actions, such as extracting data, processing transactions, and generating reports. They handle repetitive tasks critical to maintaining regulatory adherence. By accelerating workflows and minimizing errors, they ensure timely compliance with evolving regulations.

3. AI & Machine Learning engines

AI and machine learning tools are great at analyzing large datasets, identifying patterns, and making real-time decisions that support compliance. They can adapt to evolving regulations faster and more accurately than humans, helping organizations stay ahead of regulatory changes and emerging risks.

4. Regulatory intelligence platforms

Tools such as LexisNexis and Thomson Reuters Regulatory Intelligence track regulatory changes and notify compliance systems for immediate action. They use AI and other technologies to analyze data and offer actionable insights.

5. Identity and Access Management (IAM) Systems

IAM platforms like Microsoft Azure AD and Okta automate compliance by controlling access to data, applications, and systems. Only people with the right permissions can access them. By preventing unauthorized access, these tools enforce security policies and create detailed audit trails.

6. Security Information and Event Management (SIEM)

Tools like IBM QRadar study data across different sources to identify patterns that may indicate a compliance issue or security incident. They generate alerts upon detecting potential security events and notify the appropriate people. They also ensure policies are always up-to-date.

7. Data Loss Prevention (DLP) Tools

One good example in this category is McAfee DLP, which blocks unauthorized data transfers. DLP tools continuously monitor data at rest, in use, and in motion to prevent unauthorized data access, extraction, or transfer. The platforms employ detection mechanisms such as data fingerprinting to block data movement and alert on policy violations.

Challenges in Compliance Automation and How to Overcome Them 

Several challenges can negatively affect compliance automation and impact operational effectiveness, increasing the likelihood of fines and penalties. Here are the top challenges and how to overcome them.

1. Ever-changing regulations

Compliance regulations are constantly evolving, requiring constant updates to systems and processes. They can disrupt operations, strain resources, and increase compliance risks as companies scramble to update their automated systems accordingly. 

A standardized regulatory change management program can help organizations build readiness and agility. Companies can use AI and machine learning technologies to extract relevant changes and automatically update compliance workflows.

2. Insufficient internal audits

Businesses perform inadequate internal audits for different reasons—lack of resources, improperly trained auditors, lack of management support, and more. Inadequate audits can overlook some issues, which become serious problems during external audits.

To overcome this problem, have a dedicated internal audit team with a separate reporting structure to maintain objectivity. You can also hire external consultants to help identify issues your internal team may miss. Additionally, use a dedicated tool like ComplyScore® to streamline compliance monitoring and help resolve issues before external auditors step in.

3. Over-dependence on manual processes

The old saying, “to err is human,” shows how easily humans make mistakes. Research shows that human error is to blame for 95% of data breaches in organizations. A small mistake, like entering the wrong figure, can lead to compliance violations or even legal trouble.

Do away with manual processes and implement compliance automation. It will handle repetitive compliance tasks, flag issues in real time, and minimize errors. Your compliance team will be able to focus on higher-value activities, like strategic risk management and strengthening policies.

4. Vendor non-compliance

Your organization relies on third-party vendors for critical operations, but these vendors can fail to adhere to compliance requirements, increasing organizational risk. Non-compliant vendors can create vulnerabilities in the supply chain that result in data breaches, audit failures, financial losses, and reputational damage.

To steer clear of this problem, incorporate the compliance requirements vendors must meet into contracts. Assess the vendor’s compliance posture and use access controls to regulate the data they can access. This reduces exposure to critical business systems.

5. Inadequate staff training

Many organizations don’t understand how critical employee training is to compliance. Your employees are your first line of defense against cyberattacks and can adequately protect your company if they are well-equipped. Insufficient training can lead to data breaches, legal liabilities, lost productivity, and reputational damage.

Most regulatory frameworks require regular employee training, and overlooking this could lead to fines, sanctions, and penalties that impact your bottom line. Train your staff regularly to increase their knowledge of how to combat evolving threats effectively. Create a compliance culture, ensuring all employees can recognize and prevent potential hazards.

Embrace Compliance Automation with Atlas Systems

Compliance automation is a sales accelerator and will give you an edge in a competitive marketplace. Compliance regulations are always changing, and companies that leverage automation will stay ahead of the curve. A compliance automation tool ensures you never fall out of compliance, issues are addressed instantly, and that there are no surprises during auditing.

ComplyScore® by Atlas Systems helps you get the most out of your automation investment. Our robust GRC platform can automate up to 90% of your organization’s key compliance processes. It offers built-in frameworks for commonly used standards and regulations, streamlining compliance with features like real-time monitoring, automated evidence collection, and configurable controls.

Transform compliance from a burden to a business advantage - book a ComplyScore® demo now.

FAQs on Compliance Automation

1. Can compliance automation adapt to changing regulations?

Yes, compliance automation software is designed to evolve with rules; it’s not rigid like manual systems. Features like AI-driven monitoring and dynamic rule engines ensure the software easily adapts to regulatory changes, automatically adjusting workflows, reports, and alerts.

2. Can compliance automation enhance data security?

Yes, one of the key roles of compliance automation software is enhancing data security. It creates a proactive defense layer by enforcing data security rules in real-time, securing access controls, monitoring anomalies, and sending instant alerts for policy violations.

3. Can compliance automation be customized for industry-specific regulations?

Yes, compliance automation tools are built to be customizable and can be configured to fit industry-specific regulations. For example, a healthcare organization can set predefined rules on its compliance software based on HIPAA regulations.

4. Can AI or machine learning improve compliance automation?

Yes, the two technologies work together to enhance compliance automation. AI goes beyond predefined rules, interpreting complex data, detecting patterns, and making real-time judgments, while machine learning studies previous data to evolve its approach over time.

5. How often should automated compliance tools be updated?

Most automated compliance solutions are designed to auto-update and are integrated with regulatory databases and cloud-based platforms. Tools that don’t auto-update should be updated regularly (at least monthly) to reflect changes in regulations.

6. Can automated compliance tools detect anomalies or policy violations?

Yes, this is one area where compliance tools shine. They use AI and machine learning technologies to continuously scan data for unusual patterns or irregularities that may suggest non-compliance or operational risks.