Kusserow on Compliance: Common co-sourced functions used by compliance officers

Co-sourcing has evolved as the preferred method by which Compliance Officers move to meet ever increasing obligations with limited staff resources. It really is a third option between trying to do everything in-house, commonly referred to as “in-sourcing,” and having an organization decide to “out-source” the function entirely to outside experts. Co-sourcing is defined as “the combining of services from within and outside a business to achieve the same goal.” It is a business arrangement in which the work is performed by both internal staff and external contractors. In co-sourcing arrangements external workers are often used to handle peak workloads or to provide expertise that internal staff lack.” It involves using a third-party on an ongoing basis to supplement limited staff resources by carrying part of the workload. This approach has been used to achieve compliance program objectives and can address a shortage of staff by filling gaps in internal expertise and saving time, money, and effort in recruiting additional staff. It also permits retaining knowledge and leverage within the organization. In short, co-sourcing can help bridge the gap without compromising the ability to easily return to a structure where the Compliance Officer reassumes full operation when staffing issues are resolved, especially for those Compliance Officers lacking the capacity to carry out all needed compliance tasks and fill gaps in the program without keeping a full range of specialists on payroll. For those considering co-sourcing as a solution, the following may be worth reviewing as they are among the most common co-sourced roles used by Compliance Officers.

Commonly Co-sourced Compliance Function

For those looking for a co-source partner, the best starting place is the internet. Look to the desired function or service and make queries as to which firms are available to assist. For those who know of other organizations engaging a co-source partner, talk to them about their experiences, including how well they have work with the organization, the quality and timeliness of their work, and what they charge for their services. The best co-source agreements are those that permit flexibility in using the partner, while keeping control with the Compliance Officer.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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