Learn Why Compliance Management Is Critical To Avoiding Those Time Consuming And Costly Encounters With Government Regulators.
When we think about compliance management our thoughts usually go to the various government departments that in some way regulate our business activities. And managing compliance with all of the resulting rules and regulations is certainly a big part of it.
Don't be fooled into thinking that's all there is. There is another side to compliance management as well. It is the side that ensures compliance with the various systems and processes you have implemented internally.
One part keeps you out of trouble with various government regulators. The other helps your business perform to its potential. For some businesses, the role of dealing with government regulators will be a critical role. For other, more fortunate businesses, it will be a minor role, as there will be few regulations applicable. But there will likely always be some.
For many business the job of compliance management as it applies to internal systems and processes will be the larger role. It will be the role with the highest potential. For that reason it will likely attract more of your attention as a business owner.
There is little point in working to systemize your business in an effort to make it easier to operate, and more profitable if proven systems are not followed. Many employees will tend to deviate from the systems over time. They want to put a little of their own body english into their work. And while that is understandable it is also usually unprofitable.
That is the reason for exercising diligence. You have developed proven effective systems. You need to be sure that you and your employees work the systems. One summer while on vacation from university I worked with a very experienced carpenter. He taught me the lesson on measurement when we were cutting dimension lumber into 18" lengths.
I went to use the last piece cut as the template for the next piece and so on. He showed how that would soon lead to being out by as much as 1/2" in a very few pieces. His compliance management dictated that we measure and cut an 18" piece and use this one piece as our template, over and over again.
Buyers will require assurance that you have a process in place to manage your relationship with the various government regulators to prevent government action against you. And so will their sources of capital. More informed buyers will require you to demonstrate that your results can be attributed to adherence to your systems and processes. So that after management transition they will be able to enjoy the same kinds of results that you have, or better.
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