Regulatory Compliance: Definition And How Custom ERP Can Improve It
Regulatory compliance has been the hot topic for businesses over the last few years. With the growing awareness of consumer data protection and the number of data breaches that have occured over the last couple of years, it has been more important than ever for companies to implement rules and policies that help them stay compliant with all the regulations governing their industries. In this blog, we are going to explore the definition of regulatory compliance, discuss its importance and explore the custom ERP software features that can help you improve and maintain your company regulatory compliance.
What Is Regulatory Compliance?
When a company adheres or conforms to the regulations and rules set by regulatory agencies and governments, it is regulatory compliant. Regulatory policies require that companies follow safe and ethical business practices. As a result, companies and businesses are required to build their processes in a way that they comply with these regulations.
Why Is Regulatory Compliance Required In The Modern World?
The concept of corporate compliance started to gain ground back in the 1990. Today, the role of regulatory compliance is hard to overstate. To put it short, modern corporate rules and regulations exist to protect individuals and the public from various forms of harassment and data theft. Thus, regulatory compliance is a must for any corporate or government organization in this day and age.
How does regulatory compliance relate to ERP?
Before we get to the specifics, it is important to state that owning a custom ERP software itself doesn’t guarantee compliance, nor can it solve any compliance problems. ERP doesn’t specify what regulations businesses have to follow, and it can’t be responsible for anything happening outside of the ERP itself.
Once the company builds its own compliance framework, sets the internal policies and rules and structures its workflow around them, custom ERP software can help incorporate those policies into its workflow, ensuring that following them becomes the everyday routine, thus protecting the company from making unwitting and often costly mistakes.
How Can Custom ERP Software Help Improve Regulatory Compliance?
Regulatory compliance cannot be bought, like an ERP subscription. However, regulatory policies of a company can be embedded in its ERP software, especially if we are talking about a custom ERP system. It is an obligation of the company to build its regulatory framework and make sure its compliance is constantly monitored and improved. Below are the ERP software features that help improve company regulatory compliance:
1. Data security:
With the wake of security breaches in the last few years, the number of new regulations concerning data security has increased. The most widely-known (and also one of the strictest) has been California Consumer Privacy Act. If you want your ERP software to provide the highest degree of data security, ask your custom software development provider to implement access control features. Access control features allow you to set access rights to different types of data for different users. This helps ensure only authorized users can access sensitive information.
Another security feature you can ask to have implemented is data encryption. Data encryption helps protect sensitive information by converting it into the format readable only by authorized users with a special decryption key.
When it comes to industry-specific rules and regulations, ERP software comes extremely handy too. It can automate key processes such submitting reports to the financial institutions. It also allows the download of real-time reports and analytics across all business units.
2. Process transparency:
Given that custom ERP provides centralized access to all data across the entire company, it also acts as a powerful visibility tool, allowing you to track your company regulatory compliance. Much like custom ERP helps enhance data security, it allows you to set and manage access rights and configure automated reporting.
3. Quality control and traceability:
Quality control and traceability are especially important in the manufacturing industry. Quality control features in an ERP system help manufacturers set quality standards and ensure they are followed throughout the entire manufacturing process. Traceability, for its part, allows businesses to track the origin of the materials, manufacturing steps a product passes through, making it easier to identify the source of a defect in case such has been found.
4. Task automation:
The last and the most valuable feature of custom ERP software that helps to improve regulatory compliance is automation. Custom ERP software helps automate the tasks that directly affect your company compliance, for example:
- Automating reports generation allows companies to gain a better view of their regulatory compliance status.
- Automated tracking of the manufacturing process allows businesses to monitor all stages of the production process and ensure all industry standards and regulations are followed.
In the world of constantly evolving industry regulations, it is the task of the business owner to make sure the company remains always compliant. These regulations may be hard to keep up with at times. Custom ERP software is designed to help companies stay up-to-date with the latest industry regulations and avoid unnecessary penalties and fines.
Vestra Inet has served the industrial sector with a wide range of integrated software solutions for years. We look into each and every nook and corner of your business and build a custom system that helps you not only boost your business productivity, but also stay in compliance with all the industry regulations. Reach out to us to learn more about our custom software development services and schedule a free consultation with one of our experts.