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Risk-Based Regulatory Compliance for Manufacturing: A Practical 4-Step Approach

Rachel Beavins Tracy
by Rachel Beavins Tracy on Fri, Mar 23, 2018

Risk-Based Regulatory Compliance for Manufacturing: A Practical 4-Step ApproachIn 2015, the Code of Federal Regulations totaled nearly 180,000 pages of requirements. While not all of these will apply to any single manufacturer, regulatory compliance is still a major challenge for companies. In fact, many of them aren’t even aware of certain regulatory risks until it’s too late.

This fact is especially true when companies use manual or paper-based methods for quality or environmental management, which make it difficult to effectively track compliance activities.

With that in mind, today’s post looks at a practical, risk-based approach manufacturers can use to identify and assess compliance gaps.

Step 1: Compile Applicable Regulations

Your first step will be to compile all of the requirements that apply to your company in a single place. This process is nearly impossible with a manual system, but it’s fairly straightforward with an automated Quality Management System (QMS) or Environmental, Health and Safety (EHS) Management System.

Some companies might work with regulatory compliance consultants to input requirements and assess applicability, while others use electronic services that push regulations to their EHS Management System. Either way, you need a way to distinguish those regulations that are always applicable from those that are only applicable under certain conditions.

Step 2: Link Your Controls

Once you have all of the applicable requirements in one centralized repository, you can then start the process of evaluating whether or not you’re in compliance with each one. The easiest way to do this is to link individual requirements to different types of controls you already have in place, such as:

  • Engineering controls.
  • Policies or standardized processes.
  • Audit questions. 
  • Personal protective equipment.
  • Employee training or certification requirements.

Step 3: Identify Your Biggest Risks

After linking applicable requirements to individual controls, you should now have a list of requirements for which you do not have controls (or where controls aren’t sufficient). Depending on the size and scope of your operations, this list of compliance gaps might actually be quite long.

So how do you know where to start? Hint: it’s not at the top of your list. Do that, and it’s likely that some major risks will go on unmanaged while you work your way down the list.

Instead, you should use risk as your measuring stick. By running each requirement lacking a control through an internally developed risk matrix, you can easily separate out high-risk gaps from low-risk ones.   

Step 4: Take Corrective Action

The final step in the process is taking corrective action to remedy the high-risk compliance gaps identified in previous steps. Again, risk should play a key role, and not just for filtering out high-risk corrective action requests. You should also perform a final verification step that calculates residual risk after the action is complete, helping you to see whether it actually worked.

An integrated management system also helps further reduce risk by allowing you to:

  • Track and report on the resolution of compliance gaps, so you can easily verify that none have fallen through the cracks.
  • Route corrective action requests automatically, keeping them moving forward in a timely manner (and alerting supervisors to overdue requests).
  • Link corrective actions with other related items such as audits, change management initiatives and employee training requirements.

Using a risk-based approach to regulatory compliance can help companies avoid fines and penalties, but it’s important to remember that this shouldn’t be an end goal in and of itself. Instead, the goal should be achieving overall greater reliability in operations, protecting safety and quality in the pursuit of operational excellence.

Are you using a QMS suite to achieve operational excellence?

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Rachel Beavins Tracy
Rachel Tracy is a writer for ETQ with expertise in environmental, healthcare and technology topics. She has a master’s degree from Vanderbilt University and has been writing for businesses since 2008.
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