The Cost of Non-Compliance

Through our years of regulatory experience, the one mistake we have seen companies make repeatedly is spending thousands of dollars on infrastructure or staffing in order to meet government compliance requirements before understanding the length and breadth of the inspection process. The exact language of inspections or audits can be lengthy or vague. This language leaves a lot of discretion to the government agency or the inspector/auditor performing the work.

Inspectors and auditors come to the job with varying degrees of training, experience, backgrounds and biases like any other person. Determining the number of required sinks or the size of fire exits is relatively simple to ascertain, however, the terms “free from debris” or “in a safe condition” leave a lot of room for interpretation. For example, see the list of common reasons that businesses fail inspection from the City of Chicago (Chicago.gov). Vague language along with the range of experience and personality of inspectors can lead to varying results, including those that are potentially financially disastrous to a business.

Developing a thorough compliance plan early is crucial for meeting annual government requirements. Compliance specific software is not always the option and can be a costly investment. Things to consider are:

• What are the staffing needs during the lead up to meeting compliance vs. long-term needs?

• How to structure staff to be successful with compliance and essential operation?

• What infrastructure improvements need to be made?

•  How does a company maintain consistent records?

Answering these questions is the first step to developing a long-term compliance plan critical to avoiding costly mistakes, revenue loss and reputation harm for your business.