Welcome to the future of regulatory management!
In this series we describe the historic evolution of regulations, starting from unregulated industries which gradually experienced basic and internal regulations.
Today the focus is on external processes and customers, and the future promises a move towards regulations dealing with eco-systems and interfaces. Summing up the history leads us to identify six regulatory management capabilities (e.g. Data supply chain and Internal portfolio management) and five design principles (e.g. Digital economy grade data quality and Customer interaction leverage).
Looking further ahead we will address eight future regulatory scenarios, all having an innovation dimension and a tangible regulations driver. We will consider implications of (e.g.) regulating the digital economy in the post-GDPR era, expanding PSD2 for other parts of financial services and the emergence of legitimized players in the Fintech and Insurtech industries.
By following this series of posts, you will see clearly that there is no contradiction between innovation/ digitization projects and compliance projects. Instead, the realization will grow that the two seemingly contradicting investment streams support the same goal in the long run – satisfied and profitable customers (note: when I say “profitable customer” I mean that there should be benefits for the customer, and not just for the company).
The framework presented here can guide both companies and regulators to better understand the actual effects of technological innovation and the real effectiveness of regulations. In the end, the hope is that society stops looking at firms as “the perpetual ogre, the bad guy who is against good things” (as I said before, stated by professor Theodore Levitt in his 1968 Harvard Business Review article “Why business always loses”). Instead, look at regulatory requirements as the HIDDEN VOICE OF THE CUSTOMER (more about what this voice tells you in a coming blog post).