The Business Value and ROI of RCM – How AI transforms each step in the process

Introducing Our Author

Supra Appikonda, Co-Founder and COO at 4CRisk.ai completes this blog series on RCM by providing the ROI of AI at each step in the Regulatory Change Management process. Supra has decades of experience deploying complex application software solutions for large companies.  And over the last 5 years on building specialized in AI-powered products for regulatory, compliance and risk teams.  

The Overall ROI of deploying AI-powered Regulatory Change Management

Artificial Intelligence (AI) is emerging as a transformative force for Regulatory Change Management processes. But what’s the real business value and the return on investment (ROI)?

In this Blog , we build on the program steps outlined in the Blog Regulatory Change Management Program and apply ROI math to arrive at business value - how AI really delivers a fabulous ROI.

As we look at each process step in a typical Regulatory Change Management program, we can estimate how AI delivers business value, with a realistic example. We make some assumptions about the organization, that we carry through the steps of the  business process supporting in this organization.

‍

With 4CRisk’s Regulatory Change Software Product– You can expect a 70% improvement with an ROI estimated at less than a year.

‍

• This translates to $178,000 annually, assuming a $500 fully loaded daily cost ($120,000 average annual) per staff member.  
• Critically - Your staff can be freed from mundane manual tasks to provide higher value analysis and decision-making in your organization!

Our Representative Example for Regulatory Change Management ROI

Freed Days: Using the assumptions outlined below, we can expect an annual efficiency savings of ~357 staff days freed of the 505 days typically spent on these tasks, without 4CRisk’s AI-powered products.

‍

In addition to these hard benefits, organizations can leverage improved effectiveness to keep current with the compounding effects of regulatory change, while increasing resilience (bouncing back quickly from an impact) and agility (moving quickly to accomplish your goals) through quick adaptation and response to regulatory developments.

Here’s how we arrived at the Annual Savings and ROI.

Process 1: Anticipate Regulatory Changes with Horizon Scans

Assume this organization has obligations under 50 distinct regulations, rules, and laws, including 12 standards, such as NIST CSF, PCI DSS and FISMA rules. Let’s assume each has an average of 5 sections, resulting in a rulebook with 250 requirements. Let’s assume that 10% of these obligations will change in a way that needs to be reviewed for impacts to the organization.

• ‍VALUE: It takes an SME an average of 2 days to gather and synthesize the regulatory change and the impact on business units, at ahigh-level, using manual methods. With AI, you can see a substantial improvement - about 20x more effective with an LLM. That’s 3 days down from 50 days!‍

The objective of this process step is to capture changes to Guidance, Rules, Regulations, Laws, and Standards to your business with real-time streams of alerts and notifications from agencies and regulatory content sources.  SMEs gather and curate regulatory intelligence from feeds and your subscriptions (i.e. ABA) including context and applicability (guidance and examinations)‍

What the Business Value of AI at this step? Since an LLM can review a massive data set of thousands of regulatory documents, from various feeds, parse them into sections, and tag them for applicability, AI can deliver up to 20X faster results! How?

4CRisk’sRegulatory Change Management product can:

• Extracts large and complex data (unstructured and structured, including PDFs) from content sources
• Identifies and summarizes changes to regulatory obligations
• Generates Topics and Tags to facilitate filtering
• Enables Conditional Workflow based on your questions and answers: i.e., Alert in scope? Applicability? Impact Assessment required?

Process 2: Analyze & Map Rules, Regulations and Laws to Policies and Controls

Assume this organization has 250+ policies, standards and procedures related to Rulebook, and 400 control objectives that help ensure employees, third parties and technologies are compliant with regulations, rules, laws, and standards. This we will refer to as the map rule of 900 artifacts, and it is expected to change about 20% annually. That means about 65 artifacts will need to be reviewed each year.

• ‍VALUE: It takes an SME an average of 2 days per artifact to complete the Applicability Analysis, or about 130 staff days, using manual methods.  With AI, you can see a big improvement - about 5x more effective – and it takes only 26 days.

‍

The objective of this process step is to generate actionable intelligence from regulatory.

content feeds in form of regulatory obligations. From there your team would review changes and conduct a Difference Analysis of Rules, Regulations and Laws between previous and current versions. They must develop a common understanding of regulatory obligations by linking similar requirements. The team would also need to map your enterprise taxonomy i.e. product, documents, businesses, to evaluate the overall risk of a regulatory change on your business. Then finally, prioritize what needs to be re-aligned to ensure appropriate coverage with a deeper impact analysis.

What the Business Value of AI at this step? Since AI automatically maps regulations to compliance artifacts like policies and controls, AI systems can swiftly and accurately analyze extensive regulatory texts by using advanced technologies such as NLP and machine learning algorithms to parse and synthesize thousands of data sources.

‍

4CRisk’s Regulatory Change Management product can:

• Create a Difference Analysis in minutes
• Auto-Recommend which polices and controls should be reviewed based on the change
• Business /organizational attributes mapped at a granular level - 4CRisk’s Private AI Model learns to predict org relationships such as business unit, function, product, service
• Applies rule types (informative, prescriptive, prohibitive, etc.) and rule matters (disclosure, policy etc.)
• Generates confidence rating on what is/is not mapped or matched.

‍

Process 3: Identify, Access, and Manage Changes to Rules, Regulations, and Laws

Assume this organization will need to conduct a formal Impact Analysis on each artifact expected to change.  Again, that means about 65 artifacts will need to be reviewed.

• ‍VALUE: It takes an SME an average of 2 days per artifact to complete the Impact Analysis, or about 130 staff days, using manual methods.  With AI, you can see a big improvement - about 4x more effective – and it takes only 33 days.

The objective of this process step is for your team to conduct a formal business impact analysis to discern impact of changes in regulations, rules and laws to policies, contracts, procedures, and controls. They will need to review the scope of all impacts and get very specific to prioritize what needs to be re-aligned to ensure appropriate coverage and efficacy of controls.

What is the Business Value of AI at this step?

Since AI significantly augments and streamlines the process of identifying, accessing, and managing changes to rules, regulations, and laws to aligning policies, procedures, and controls to upcoming changes.

4CRisk’s Regulatory Change Management product can:

• Pinpoint impact of proposed or new obligations on compliance and governance documents such as policies, procedures, and controls in your organization
• 4CRisk’s Private AI Model continues to learn org relationships such as business unit, function, product, service
• Do things you may never considered– like supporting Law Memo summarization of the impact of changes on the organization‍

‍

Process 4: Manage Changes to Completion

Assume this organization will need to make updates to each artifact expected to change.  Again, that means about 65 artifacts will need to be updated.

• ‍VALUE: It takes an SME an average of 1 day per artifact to complete the change, using manual methods. Some will take longer; other changes will be straightforward. With AI, you can see another improvement - about 3x more effective – and it takes only 22 days down from 65 days, with more accurate action planning, and language suggestions.

The objective of this process step is to prioritize actions to close gaps in compliance and governance documents, such as policies and procedures. Raise issues and action plans to assign actions to the right SMEs to conduct the change.

What is the Business Value of AI at this step?

AI significantly transforms the landscape of reporting and answering questions in regulatory change management by providing a swift, accurate, and streamlined approach. For example, Conversational AI can answer questions like – what policies and business units are affected by this regulatory change? What is the legal age of consent across our obligations and do our policies provide coverage for that? AI systems can rapidly scan and comprehend rulebooks and policies to identify the specific policies affected by regulatory changes and generate detailed, easy-to-understand responses. The speed and precision of AI not only enhances the accuracy of information but also facilitates agility in responding to inquiries.

4CRisk’s Regulatory Change Management product can:

• Auto-track remedial actions
• Generate language recommendations to close policy and control gaps
• Ask ARIA Co-Pilot will answer queries quickly and accurately to help in action planning

‍

Process 5: Report and Answer Questions on Regulatory Compliance

Assume this organization regulatory affairs SMEs take 2 days for each of the 65 changes, to meet with regulators, leadership, legal, IT, security, privacy, and risk management teams and third parties to review the current state of compliance, prepare reports and follow up of actions resulting from these sessions.

• ‍VALUE: It takes an SME an average of 2 days per artifact to complete the right reports and reviews.  Factoring in 2 x more efficiencies, greater speed and accuracy in reporting and governance due to AI, we can reduce the total days of effort from 130 to 65 days!

The objective of this process step is to develop and report on program metrics and results to regulators, business, third parties and leadership. The team must also ensure data consolidation, interpretation and consistency, leverage compliance SMEs appropriately for reviews and examinations and provide continuous improvement in overall governance. There is significant effort expended in regulatory affairs teams to ensure data consolidation, interpretation, and consistency of these reports. It’s critical to leverage compliance SMEs appropriately for reviews and especially examinations. Your Regulatory Change team is critical to the organization, and it’s important to provide continuous improvement through compounding benefits of self-learning and self-optimization Refine compliance and governance documents such as policies, controls based on gaps from impact analysis.

What is the Business Value of AI at this step?

Since AI can provide more accurate information and engaging analytics - and even drive intelligent workflow, you can expect to see gains from using AI in this process.

4CRisk’s Regulatory Change Management product can:

• Provide intuitive metrics, dashboard, and reporting drives data consolidation, interpretation, and consistency
• Streamlines workflow based on roles, supporting good governance
• Automates Action plan management based on accountable roles and responsibilities

Check out these related blogs and resources  

• https://www.4crisk.ai/post/the-business-value-and-roi-of-rcm-how-ai-transforms-each-step-in-the-process ‍
• https://www.4crisk.ai/post/compliance-three-key-actions-to-leveraging-ai-successfully-in-2025 ‍
• https://www.4crisk.ai/whitepapers/revolutionizing-regulatory-change-management-the-power-of-ai