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Posted On:
February 14, 2024

LEARN Series 3: Regulatory Research: How AI-driven technology is revolutionizing compliance programs

The ROI of Regulatory Research– How AI transforms each step in the process

In this blog, we review steps in a Regulatory Research Program and apply ROI math to arrive at business value - how AI really delivers a fabulous ROI.

Artificial Intelligence (AI) can be a transformative force for Regulatory Research – A process to transform diverse regulations into a cohesive and well-documented rule book. But what’s the real business value and the return on investment (ROI)?

The Overall ROI of deploying AI-powered Regulatory Research

In this blog, we build on typical Regulatory Research program steps and apply ROI math to estimate how AI delivers business value with a realistic example. We make some assumptions about the organization that we carry through the business process steps supporting this organization.

With 4CRisk’s Regulatory Research Product – You can expect a 90% improvement with an ROI estimated at less than a year.

This translates to $264,333 annually, assuming a $500/day 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

Freed Days: Using the assumptions outlined below, we can expect an annual efficiency savings of ~529 staff days freed of the 1000 days typically spent on these tasks, without 4CRisk’s AI-powered products.

Would you like a walkthrough of our Regulatory Research Value Calculator to see what you of 4Crisk products can do for your organization?  Contactus@4crisk.ai  or click here to register for the ROI Calculator demo.

HERE’S HOW WE ARRIVED AT THE ANNUAL SAVINGS and ROI – ASSUMPTIONS and DATA

Let’s assume this organization has

  • Obligations under 50 distinct regulations, rules, and laws, including 12 standards, such as NIST CSF, PCI DSS, GDPR, CCPA and FISMA rules.
  • Each has an average of 5 sections, resulting in a global rulebook with 250 requirements.
  • 5 rulebooks will need to be created and reviewed with different business units.
  • The compliance team manages a compliance framework 900 artifacts – comprised of 250+ policies, standards and procedures, and 400 control objectives that must be related (mapped) to Rulebook.

Process 1: Create & Manage RuleBooks and Inventories

The objective of this process step is to identify the agencies and sources for rules and standards applicable to your organization. From that, your team will generate your rulebooks, specific to your organization, based on your jurisdictions and the products you sell. You’ll need to parse the rule documents into citations or sections to do this. This also means creating plain language obligations from business source rules.  You will also need to identify the applicability of rules based on AI-suggested type (informative, prescriptive, permissive, prohibitive).  Importantly, your team will identify your potential governance documents that need to be reviewed based on “impacted matter” (disclosures, policy, procedures, reporting, recordkeeping, fees/rates, liability, licensing, and other actionable information.

Since AI can review a massive data set of thousands of regulatory documents from various authority sources, parse them into logical statements, and tag them for applicability, AI can deliver up to 5X faster results! How?

4CRisk’s Regulatory Research product can:

  • Auto generates an accurate rulebook in minutes, in plain language.
  • Extract large and complex data (unstructured and structured) in minutes
  • Break down large documents into granular parsed sections to support granular mappings and analyses
  • Tags of rules based on AI-suggested type (informative, prescriptive, permissive, prohibitive).
  • Tags governance documents that need to be reviewed based on “impacted matter” (disclosures, policy, procedures, reporting, recordkeeping, fees/rates, liability, licensing, and other actionable information)

VALUE: It takes an SME an average of 3 days to gather and synthesize a law or regulation or regulatory change and the impact on business units, at a high-level, using manual methods. With AI, you can see a substantial improvement - about 5x more effective. That’s 3 days down from 15 days!

Process 2: Create a Rule Book(s) – Human in the Loop

The objective of this process step is to share and collaborate with team members for review, comment, and approval of your draft rulebooks. It’s much more efficient if they can search and collaborate to finalize rule books and create different rule books for distinct business units, products, processes from regulations, rules, laws, or standards.

4CRisk’s Regulatory Research product can:

  • Share and collaborate with SMEs for review, comment, and approval of rule books
  • Search and collaborate between SMEs to finalize rule books
  • Create rule books for distinct business units, regulations, rules, laws, or standards
  • Allow your colleagues to prioritize their work
  • Provide a heads-up to impacted business units and the documents they support

VALUE: It takes an SME an average of 2 days for each of the 5 rulebooks to complete these reviews, or about 10 staff days, using manual methods.  With 4CRisk Regulatory Research product, you can see a big improvement - about 3x more effective – and it takes only 3 days.

Process 3: Merge Similar Obligations

The objective of this process step is to merge similar obligations across multiple regulatory sources and standard bodies such as ISO and NIST, GDPR and CCPA. The team typically creates common obligations manually through inspection and editing documents.

4CRisk’s Regulatory Research product can:

  • Automatically create distinct rulebooks for each regulation, then identify similar rules across the regulations
  • Automatically merges similar rules to create a common obligation, with an audit trail to the sources
  • Generates a sample risk statement from obligations

VALUE: It takes an SME an average of 1 day for each of the 75 similar obligations (assuming 30% similarity) to complete these merges, or about 50 staff days, using manual methods.  With 4CRisk Regulatory Research product, you can see a big improvement - about 5x more effective – and it takes only 15 days.

Process 4: Map to your Business Information

The objective of this process step is to associate your enterprise taxonomy, including risk category, control category, products, and services, to identify the applicability of each rule.

4CRisk’s Regulatory Research product can easily map your rulebook obligations to your enterprise taxonomy and get them ready to upload to your GRC Libraires, if required.  

VALUE: It takes an SME an average of 1 day for each of the 900 compliance artifacts to complete an accurate mapping, and update all related systems and spreadsheets, or about 900 staff days, using manual methods.  With AI, you can see a big improvement - about 2x more effective – and it takes only 450 days the first time around, and from then on it’s very easy to maintain.

Qualitative Benefits

In addition to the hard benefits above, organizations can

Reduce the risk of non-compliance with accurate rulebooks

  • Create and manage a full spectrum of global regulations aligned with business obligations
  • Eliminate human errors and biases when connecting rules to internal control framework

Improve the quality of the regulatory research process

  • Eliminate manual effort and cost in discovery, analysis, and mapping between diverse regulations
  • Drive transparency and improve insight and ensure plain language synthesis of obligations

Become faster and more agile as teams create accurate, up to date rule books

  • Quickly review requirements and create rule books based on robust requirement inventories
  • Incorporate AI driven insights into regulatory requirements create strategic and business advantage

Would you like a walkthrough of our Regulatory Research Value Calculator to see what you of 4Crisk products can do for your organization?  Contactus@4crisk.ai  or click here to register for the ROI Calculator demo.

4CRisk products: Regulatory Research, Compliance MapRegulatory Change Management, and Ask ARIA Co-Pilot are revolutionizing the way organizations connect regulations with their business requirements.

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