The 10 Step Guide to Acquiring Risk and Compliance Technology

and compliance software solutions that connect related data, automate workflow processes and accountability, and provide real-time reporting have become an operational and competitive necessity for small and medium sized banks. However, many mid-size banks and financial services organizations find the process of selecting and implementing the right solutions challenging. Along with evaluating varying technology approaches among vendors, customers must also build advocacy internally.

Following is an outlined 10-step process to successfully evaluate, acquire and implement the best solution for your organization. Click here for the full report, including checklists for each milestone.

Identify & Document Challenges

The goal is to ensure that the risk and compliance technology being selected and implemented will align with the strategic objectives of the organization, which is why it is important to clarify current challenges, goals and needs first. It is essential to involve all risk and compliance stakeholders including first, second and third line personnel who are facing challenges with the current process or system.

Determine First-Pass Criteria to Address Challenges

Once the challenges, needs and goals of the organization are clear, they need to be codified. Look at the problems that need to be solved to create a needs-based checklist for risk and compliance technology solutions. Do you need a system that automates compliance management? Does the organization require more accurate methods to predict risk? Is the auditing system in need of an overhaul? Once you know the answers of these questions, you will have a basic idea of the types of solution that potentially fit the organization’s needs.

Research Potential Solutions

Since your organization will now have a clear idea about the type of functionality it needs from the solution, it can start investigating vendors and solutions available in the market to narrow down which ones fulfill the first-pass criteria checklist created in the previous step. Organizations may choose to ask for recommendations from peers in the industry or search for different technology vendors online, through trade associations, at conferences, and more.

Evaluate Vendor & Product Alignment

Once potential solutions have been found, the next step is to talk to the selected risk and compliance technology vendors. A demonstration of each vendor’s solution will enable the organization to evaluate and assess key functionality and begin evaluating ROI on the risk and compliance technology before it is implemented. It is also a good idea to ask for similar customer use cases from the vendors.

Refine Criteria

After identifying finalist vendors, the management should refine their criteria. Now that it is clear what the organization needs and what the different solutions can offer, the different solutions need to be compared. The criteria chosen for the comparison depend on the needs and size of the organization. Some may prioritize a lower implementation cost, while others may prioritize a holistic solution. The ROI is one of the most important criteria in a technology implementation and depends upon both the cost of the solution and the benefits it promises to deliver in return.

Secure Budget & Internal Approval

Budget allocation and contract approval from senior management is typically needed to move forward. Convincing senior management is more successful if the required information has been collected and is presented in the right manner. Emphasis should be put on how the solution aligns with the goals and vision of the organization as well as the return on investment that can be expected. Try to present something which management can share as a competitive advantage with stakeholders of the organization.

Perform Due Diligence

Due diligence is a necessary step in any implementation. Your in-house IT team will play a pivotal role in the due diligence, because they will be able to assess how the infrastructure requirements of the organization align with the selected solution’s technology. Meanwhile, your business team should do a bit of background research on the vendor to ensure that they have a positive track record in the industry.

Contract Negotiation

The final step before the purchase is ironing out all the details in a formal contract. The contract will cover any customizations, delivery commitments, service and maintenance charges, and much more. The contract negotiation process is usually handled by the procurement department and the executive branch of the organization.

Purchase

Once the contract has been signed, the purchase can be considered final, and the details of the contract are shared with all the stakeholders of the organization. Most businesses include any such information in their investor documents and other portfolio documents.

Implementation Kickoff

Once the contract is finalized, the business can start implementing the technology. This generally entails a team from the technology vendor working along with teams withing your organization through a formal project management plan. The vendor is also responsible for ensuring that your teams receive training.

These 10 steps ensure that all the necessary steps have been taken before a risk and compliance solution is implemented. Is your business aiming to implement risk or compliance technology? Get in touch with our team to understand what the technology can deliver and see a demonstration of what it can do for your organization.

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