Too Hard? Too Complex? Let’s Crush the Top Compliance-as-a-Service Myths

The onslaught of cyber threats and breaches has likely forced cybersecurity and data privacy to the top of your priorities as a managed service provider (MSP). But what about compliance? Often seen as complex and burdensome, a strong compliance program can actually be a catalyst for business continuity and growth.

In this article, we explore the common myths of compliance (trust us — it doesn’t have to be a pain!) and explain why MSPs can drive revenue by embracing Compliance as a Service (CaaS). But before we dive in, let’s take a quick look at the definition of CaaS.

CaaS — the Antidote to Compliance Complexity

The Problem: Complexity

Few organizations can escape the impact of data and privacy laws, industry regulations, and internal compliance directives that influence every aspect of how they do business. Failure to comply can lead to severe legal penalties, data breaches, reputational damage, and reduced client trust.

Despite the potential consequences of noncompliance, many organizations balk at actually putting in the work, viewing compliance as a too complex, challenging, resource-intensive, and potentially expensive undertaking. Instead, some treat compliance as a checklist item, an obstacle to profits, or something to think about only after a problem arises.

The Solution: CaaS

In response, Compliance as a Service has emerged. CaaS is designed to help organizations meet increasingly stringent cybersecurity, data privacy, and compliance requirements. By outsourcing compliance management and maintenance to a third-party expert, companies can effectively stay on top of compliance demands.

No one is better positioned to be that third party and offer CaaS than MSPs. But just like the organizations that need your help with compliance, you may be stuck with an impression of CaaS and compliance in general that simply is not true. Cue the myths:

Fact Check: 6 Common CaaS Myths

The need for compliance management systems is growing at the national, international, and even company levels, but it’s easily one of the least understood components of the business landscape. Let’s debunk some of the most common CaaS myths and shed some light on the true value and importance of developing a flawless compliance practice with ease.

Myth #1: Compliance is a one-time undertaking.

Fact: Compliance is an ongoing process that requires continuous monitoring and updating to reflect changes in laws, regulations, and industry standards. The dynamic nature of regulatory environments means organizations must regularly review and adapt their compliance strategies. The U.S. Department of Justice's guidelines on evaluating corporate compliance programs emphasize the importance of continuous improvement, testing, and review.

Fact: Compliance should be treated as a program that’s part of an organization’s operation, policies, and culture. It involves all the systems and all the people in an organization, and it requires constant assessment and improvement.

Myth #2: Not all businesses need a compliance program.

“Compliance doesn’t apply to my organization.” That attitude is not entirely uncommon, especially among smaller companies. It’s easy to think compliance is for the big boys only when, in fact, hardly any company, large, medium, or small, can remain out of regulators’ reach. (Do you have a website? There’s compliance involved…)

Fact: All businesses, regardless of size or industry, are subject to some form of regulatory compliance requirements. While the complexity and scope of these programs may vary, the necessity of having a compliance framework in place is universal. The Small Business Administration (SBA) advises all small businesses to understand and comply with legal obligations to avoid penalties and legal issues. For example:

The General Data Protection Regulation (GDPR) applies to any organization that collects data on any citizen in Europe.
The Payment Card Industry Data Security Standard (PCI DSS) applies to any business that processes credit card payments.
The Health Insurance Portability and Accountability Act (HIPAA) applies to healthcare providers, health plans, healthcare clearinghouses, as well as their business associates.
The California Consumer Privacy Act (CCPA) applies to any business that handles the personal information of residents of California.
The Cybersecurity Maturity Model Certification (CMMC) applies to all Department of Defense contractors, as well as suppliers and subcontractors.

Myth #3: Compliance is a burden.

Fact: While compliance requires investment in resources, it ultimately protects businesses from fines, legal penalties, and reputational damage. Furthermore, a strong compliance program can enhance operational efficiency by identifying and mitigating risks before they escalate. According to a report by PwC, companies with robust compliance functions are better positioned to navigate regulatory complexities and gain a competitive advantage.

Fact: With the right people, process, and technology, compliance can be easy (we’d say even fun, but that’s why we do what we do). Compliance frameworks were put in place for a reason. Whether to protect customer data, establish a workplace code of conduct, fight corruption, or protect the environment, they cannot be ignored or haphazardly dealt with. The good news — we know how to uncomplicate compliance.

Myth #4: Compliance programs hurt profits.

Fact: Effective compliance programs can lead to cost savings by avoiding fines and litigation expenses. Additionally, they contribute to a positive corporate culture and reputation, which can drive business success. A study by the Harvard Business Review highlights how companies committed to ethical practices and compliance demonstrate better financial performance over time.

Myth #5: Compliance is a reactive exercise to a problem.

Oops…you failed to comply with GDPR because of a simple oversight. Noncompliance comes with enormous risks. Consider, for example, that a GDPR enforcement tracker shows European authorities issue 25 to 60 fines a month. As of March 2024, companies have been fined €4.4 billion ($5.5 billion) since the regulation was passed. If you wait until there’s a problem, it’s often already too late.

Fact: A proactive compliance strategy helps organizations anticipate and mitigate risks before they become problematic. This approach not only reduces the likelihood of regulatory violations but also supports strategic business planning and resilience. The Compliance and Ethics Program with Federal Sentencing Guidelines for Organizations emphasizes the importance of proactive measures in establishing effective compliance programs.

Myth #6: Compliance can be completely outsourced.

Some research suggests that as much as 70% of corporate data breaches are the result of employee error or malicious intent. Organizations should understand that employees are the first line of defense in compliance, and the whole team needs to be on board with any compliance program.

Fact: While certain elements of a compliance program can be supported by external experts, the ultimate responsibility for compliance rests with the organization. Effective compliance requires internal oversight and a culture of integrity that permeates the entire organization. Guidance from the International Organization for Standardization (ISO) on compliance management systems underscores the importance of leadership involvement and a holistic approach to compliance.

Compliance as a Service for MSPs

Compliance is an ongoing, essential part of an organization’s operations. Having a strong compliance program mitigates risks, fosters client trust, and builds a resilient foundation for business growth. As an MSP, you and your clients can benefit from a rock-solid compliance practice. With your own house in order, you will be perfectly equipped to help your clients.

But if you’re new to the world of compliance and governance, we understand the need to do your research – and, at Compliance Scorecard, we have the tools to help. Start by downloading our Governance Playbook and our Risk Assessment Template. When you’re ready to get serious about a compliance program, book a demo to learn about our MSP-tailored compliance platform.