So I’m done with two projects. Three to go. This was a group project for class “Creating Business Value from IT”, a class I’m really excited about. The class answer why I should work with It in the first place. The project tells how compliance is done successfully, which all banks must do in order to stay in business. If this sound even vaguely interesting, read on:

To go about this project, we search through about 16 Gartner reports, surveys from KPMG and some blogs about Compliance. But as the key source of information we were lucky enough to meet with senior management at State Street here in Boston. The project group was Morten, who’s also from Norway and works in a bank with IT security, and Manjit, a Sloan Fellow from India, who works with private equity. A really great group.

A quick take on compliance implementation: Every bank must comply to these regulations like Basel II or Sox. However, only 20% of all banks will adopt best practice. Companies that do individual solutions for each compliance regulation is likely to spend 10 times more on IT cost than banks that integrates compliance better from the beginning of their business. Companies that simply comply to regulations have a costs related to the project. Banks that utilize the new information the regulation provides them can use the data for better decision making. Hence, doing compliance right might actually provide a competitive advantage.

Here are some Key Success Factors:

  • Data Quality: The data from regulation requirements must be uncorrupted, available and complete. Failure here may be very costly as regulation is not met.
  • Plan compliance early into projects: regulation requirements should be put into the start of projects. Development teams, business units and quality teams should have a collective responsibility and commitment to ensure and deliver compliance.
  • Integrate Compliance into all parts of the organization: Employees must be taught in order to enfore compliance in a successful manner.
  • Experience matters: Doing compliance right is about experience. Consultants with experience to the specific compliance regulations may be a good investment to ensure success with implementing regulations.
  • Portfolio balance: Even though compliance projects gets prioritized, they should be balanced with NPV positive projects. The project portfolio should consist of regulative projects as well as strategic projects (that will improve the organization or increase revenue).

Thanks guys for an interesting project!