Regtech Reality Check
Advances in technology have been accelerating since people started writing about ”advances in technology”. Pick whatever starting point is relevant to you, whether it is cave drawings or social media blogs, the story races forward with increasing speed, widening industry impact and broader cultural and human effects. Witnessing this relentless shift can be both invigorating and terrifying since it simultaneously poses great opportunities as well as challenging societal and ethical questions - which I will leave to other, more scholarly and informed sources to debate.
However, as a risk practitioner in the market today, specifically regulatory compliance risk management in the heavily regulated US banking industry, I have earned some front line insight, experience and lessons learned on harnessing advanced data analytics, robotic process automation and cognitive computing in the messy real world that is constrained by actual budgets, people and the reality of your starting point to adopt the latest technology and capture the related benefits (typically improvements in quality, efficiency and scalability).
#1. Get started whether you think you are ready or not and go long:
The first thing to accept is that you are probably not ready. The second thing to accept is that you can't wait any longer to get started. In my industry, and many others, it is highly unlikely that your business processes, legacy technology, data quality, and employee readiness are all at the starting line ready to go to adopt the latest technology. Once you do start, your team will need to be champions to build support, cheerleaders to generate and sustain momentum, and resilient player/coaches to press on after the many setbacks that are waiting for you. (Sidebar - it's worth it but you have to play the long game).
#2. Toss your traditional business case mindset:
Depending on where your organization is on the technology currency/obsolescence curve, your degree of difficulty in adopting today's most advanced technology may not initially yield the level of return on investment that you expect. The gap between your current technology (and data quality/availability) and your new target environment will have a significant impact on the amount of sweat equity you will need to invest along with actual capital. Luckily, I have found that typically the benefits of adopting new technology compound quickly once you clear the initial implementation/adoption hurdle. The other important benefit (typically not included in the business case) is the culture shift that ripples through your organization as you become more current, capable and eventually more competitive through efficiency and speed to market. Which leads to my third point.
#3. Start small and grow tall:
For many years, change leaders have advised organizations to shift your transformation strategy away from high risk “big bang” technology projects and focus on phased projects with prototypes and pilots in order to lower risk and create smaller (but quicker) wins to expand upon. And now that approach itself has evolved into Agile. Starting small does not mean that you shouldn't be thinking big. In fact, due to the high degree of interoperability across today's technologies and applications, a layered approach to automation, analytics and cognitive computing can yield significant benefits. This requires a design thinking approach to assemble the right tools and capabilities for your objective since it is unlikely you will find it all in one box.
Finally, choose your partners carefully, both internally and externally. Successful outcomes with today's technology is a team game. Finding the industry partners and providers with the right technology and the right people who will commit to your goals is critical to your success because you will not get there alone.
Check out: Top RegTech Solution Companies