The management of change inside an organization and how you should manage it is becoming increasingly important to compliance officers. According to regulatory agencies, change management is a vital component of an institution’s compliance management system.

You will learn why it is so vital in this post.

Defining Change Management

Change management is a controlled and repeatable process to guarantee that only permitted changes are delivered. All changes are introduced into the production IT environment in a controlled and repeatable way, including application code and infrastructure changes. A few of such changes include bug fixes, new features, system upgrades, and patching, to name a few.

Change Control vs. Change Management

The evaluation of a system change request and the judgment of whether it is a valid change gets referred to as change control. On the other hand, change management refers to the full process of managing and tracking changes, from the time a change request gets made to the time a change ticket is closed.

Change Management Objectives

Change management’s primary goal is to ensure that any modifications to software applications, database systems, and related infrastructure assets are appropriately permitted, documented, tested, approved, and implemented in the production environment. This system gets implemented to meet service commitments and system requirements, thus aiding in the comprehensive, accurate, and timely processing and reporting of transactions and balances pertinent to the user entity’s internal control over financial reporting or other non-financial system purposes.

How Change Management Helps Implement and Maintain Compliance

Change is a fact of life. Institutions and compliance professionals will always have to deal with it.

Institutions should not be limited to preparing for large-scale changes. Even minor changes, such as a new interpretation or a software update, can significantly impact. Thus, change should be expected as a regular occurrence in institutions.

These changes are also fraught with danger. Institutions that fail to implement effective change management controls may suffer a technical penalty and a lower grade on an assessment.

Moreover, companies may begin to expect reduced operational efficiency, ineffective communication, customer confusion, challenges with customer service, and a risk to their reputation if they do not respond to change promptly. If not addressed properly, these concerns could cascade throughout the company.

Change Management for Compliance Tips

Change management controls will typically use a combination of preventative and detective controls and other types of controls such as approval, peer review, manual and automated testing, system access, segregation of duties, exception reporting, and reconciliation, among others, to mitigate the risks above.

It is vital to remember that controls merely provide a semblance of certainty that you will meet the control’s stated goals. In most circumstances, controls do not guarantee absolute confidence since it would be too expensive to do so.

The following are some examples of change management controls:

• At least once a year, management reviews a defined Change Management Policy and Procedure to see whether it needs to be updated.
• The change management process includes established roles and responsibilities for adequate separation of functions.
• A ticketing system, a code repository tool for version control, and testing tools help change management.
• Before constructing a bug patch or new feature, the company owner and IT management evaluate, document, and authorize change requests based on stated needs.
• A peer programmer or an independent IT quality assurance team member will review, test, and approve the change for its intended functionality and specifications. The developer gets notified of any issues, and they get reworked.

While not all of these controls are essential for the change management process, you must suit each service organization’s change management environment to each specific service organization’s needs because no one size fits all.

Enter, the Auditors

The purpose of a change management audit is to establish if controls give reasonable confidence that changes to existing infrastructure, data, or software are permitted, documented, tested, approved, and implemented by the change management objective.

The auditor will most likely want to acquire the service organization’s Change Management Policy and Procedures. These procedures must explain:

• How changes are authorized before starting work on it.
• Investigate the change documentation for the entire life cycle of the change.
• Verifying that you tested the difference before deployment.
• Ascertain that you approved the change for deployment into production.
• And Check evidence that an authorized individual implemented the change before proceeding.

The following are examples of the types of tests that the auditor will conduct:

• Inquiry of the competence and understanding of those in charge and confirmation from management.
• Observation of the existence of the control, application, or performance.
• Examination of the supporting paperwork that proves the control’s effectiveness.
• Re-execution of control.

In sum, the auditor will most likely walk through the controls to ensure that changes to existing infrastructure, data, and software are authorized, documented, tested, approved, and implemented, as well as assess whether the controls adequately address the identified risks of the service organization.

Conclusion

One thing is certain, and that is that things change with time. The organization’s ability to manage system changes, whether planned or unplanned, is protected by change management controls, which reduce interruption, system difficulties, and production outages caused by the inadequate implementation of change management controls.

In this sense, a change management audit is an impartial assessment that provides management with feedback on the effectiveness of the existing change management controls in terms of design and operation and identifies any design or operational flaws.

An audit’s performance is an important part of a service organization’s overall internal control environment. It allows the organization to keep track of its internal controls and ensure that they are operating via management expectations to achieve the organization’s goals.

Finding the right solutions provider for a solid change management and compliance campaign is essential. Choose a provider that gets focused on developing agile technological solutions, such as ITSM & Workflows Automations, Employee & Business Workflows, 24/7 Services with Artificial Intelligence, among other solutions, that simplify and generate real value in organizations day-to-day.

Finding the right partner will make your change management and compliance endeavors, well, manageable.