No matter what the size of your organization, you have to deal with government paperwork. Regulations are a fact of life for every company, including small to medium-sized businesses (SMBs), and if you are a Connecticut SMB, you are familiar with the regulations governing employment, consumer privacy, secure transactions, exports, and the like.
With a new administration in Washington, federal regulations are changing and so are many state rules, and it’s an ongoing challenge for Connecticut SMBs to keep up.
According to a survey by the Connecticut Business & Industry Association (CBIA), government regulations and policy decisions were among the top three challenges facing Connecticut SMBs, and 92 percent said that Connecticut public policies do not help small business. Labor regulations are the most overwhelming problem for SMBs, and 65 percent say that the Affordable Care Act has had a negative impact on their business.
In addition to regulatory and compliance issues related to employment, Connecticut businesses have to deal with regulations in other areas. Retailers are faced with regulations relating to secure transactions and consumer protection, such as compliance with the Payment Card Industry Data Security Standard (PCI DSS). Healthcare providers have to be concerned about patient privacy and complying with the Health Insurance Portability and Accountability Act (HIPAA). Financial institutions have to address regulations such as Sarbanes–Oxley; Dodd–Frank; and various security, privacy, and residency rules. If you are in manufacturing, you have to deal with import and export rules and trade regulations.
Depending on the industry, Connecticut small businesses are drowning in regulations and finding it difficult, and expensive, to keep up. However, the costs of non-compliance are higher. Consider that a HIPAA violation can cost from $100 to $50,000 per violation, up to a maximum penalty of $1.5 million. It’s not unusual for businesses, especially SMBs, to overlook regulations, because they lack the resources to track everything. Many organizations have regulatory intelligence professionals to help track the latest regulations, determine which affect the business, and determine if the organization is compliant, and everyone relies on computerization to help them stay compliant.
A Few Regulations That Can Affect Your Business
Regulations fall into basic categories: some that will affect all Connecticut SMBs and others that will have more impact on SMBs in specific industries. Here are just some of the government regulations to keep track of:
Secure Transactions – Retailers and others need to guarantee secure financial transactions. PCI DSS, for example, was created as an international initiative to ensure secure credit card transactions. Compliance covers a broad spectrum including security management, policies and procedures, network architecture, and software design. The new EMV standard (initiated by Eurocard, MasterCard, and Visa) for credit card transactions at the cash register also is designed to protect consumers and retailers from hackers and credit card fraud.
Secure Data Archives – Accountants, healthcare providers, and businesses that keep personal information are required to secure client and patient records. Some SMBs prefer to store data on premises, but there is always a risk of data loss or a security breach. To minimize risk, more SMBs are opting for cloud data repositories or off-site data storage. Managed services providers often offer secure data storage as part of their backup services.
Auditing and E-discovery – As part of regulatory compliance, you may be audited by government agencies, often without notice. Making sure your data archives are clean, organized, and auditable can be crucial, especially if you need to assemble files to prove compliance to a regulatory agency or in court.
Secure Import – For companies receiving international goods and materials, there are regulations such as Customs-Trade Partnership Against Terrorism (C-TPAT) and the Free and Secure Trade (FAST) program. C-TPAT is designed to prevent terrorist weapons and materials from entering the country. FAST is designed to expedite imports from Mexico and Canada by prequalifying carriers. As with any regulations, filings and records have to be updated regularly.
Disaster recovery – To maintain data integrity, every SMB should have a disaster recovery plan in place. Surprisingly, according to the CBIA survey, 43 percent of Connecticut SMBs do not have a disaster recovery plan. Disaster recovery should cover various contingencies, such as fire, flood, loss of power, data breach, and other disasters. Developing a disaster recovery strategy is more than maintaining secure data backups. You need to have a protocol in place to alert key members of staff, initiate secure shutdown procedures, and have an updated contact list of whom to call, as well as a plan to get your business up and running again. For mission-critical computing, for example, some companies have failover systems ready, just in case.
Technology Services Help You Stay Compliant
Computers are at the heart of most regulatory compliance. Secure computer files and transactions are required to make sure Connecticut small businesses have up-to-date records and a secure infrastructure to exchange and secure data. For SMBs especially, understanding regulations and updating systems and procedures for compliance are time-consuming and expensive. Rather than dealing with government regulations yourself, it’s more practical and cost-effective to get help from a specialist.
Managed services providers such as NSI deal with government regulations as a routine part of system installation and maintenance. Keeping secure data backups and providing cloud-based computing services has become a security strategy that complies with most regulations, if it’s handled properly.
To make sure you have the right solutions and protocols in place to ensure your business is compliant, find a partner that can provide expert guidance. It’s less expensive than failing to comply.