What is Compliance and why is it important?
Compliance. Mention the word and eyes roll, conversations suddenly end and people go quiet. It’s not the sexy stuff of running a business. It doesn’t instantly lead to more members, increase profits or save on costs. and it seems many would rather ignore the topic until absolutely necessary. But the reality is that it can impact ALL these things long term, consistently working in the background unseen. Sadly, this often means that businesses who ignore it have to learn the hard way that simple proactive measures are crucial to protect the future.
Good planning and preparation around compliance can also mean there are, ironically, fewer instances where it is needed, because businesses are being run in a way to reduce risk. Sometimes the benefits surrounding compliance aren’t even evident, leading to complacency. Failure to comply can have significant negative effects, including harm to others, fines, prison sentences and loss of the business.
But regardless of the situation, the importance of compliance remains the same. Circumstances dictate whether a lack of attention to the basics will be the downfall of a business, and by the time this is evident, it is too late. Breaching legal requirements can lead to unlimited financial penalties and prison sentences, with the potential to ruin businesses regardless of if they have a monthly turnover of £2000 or £20 000. The most serious breaches could lead to a death occurring, and no amount of money can ever compensate for that.
So what is compliance and why is it necessary? Simply put, it is ensuring that business activities are in accordance with all relevant legislation and regulations, from national and international requirements, down to local council levels. It encourages safe working practices and procedures, fair treatment of staff and clients, and protection of business assets.
It includes risk assessments, emergency procedures, and checklists all underpinned by an up-to-date legal register. Regular auditing ensures ongoing compliance.
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Compliance can affect / help businesses in the following ways:
Business protection & insurance:
Insurances are largely put in place to protect businesses if something goes wrong. Often there is small print in insurance policies that many gyms miss and therefore don’t fulfil, mainly around policies/procedures/monitoring. This can invalidate policies and leave businesses without cover, which can be particularly damaging if only realised when making a claim.
We have seen that the more businesses focus on compliance, the fewer claims that are made in the first place. Plus any claims that are made are more successful.
Access to funding/grants:
Part of the application process for funding/grants often requires the confirmation (and sometimes proof) that certain policies/procedures are in place. Whilst it might be tempting to treat this as a tick-box or paper exercise, this is a risky decision if businesses are found not to have an implemented system and could lead to penalties and/or loss of funding.
Fewer incidents:
It is no surprise that risk identification, mitigation and management helps to reduce business incidents. A key element of risk management is recording near misses and dangerous occurrences, of which these are hundreds for every actual incident. This allows patterns to emerge and be acted upon, through continual improvement, to prevent incidents occurring in the first place.
Fewer complaints:
Likewise, policies and procedures help to establish and communicate expectations. They also serve to remove emotions from incidents and give a clear path for resolution, in turn reducing the impact on a personal level with such circumstances.
Improved staff and client morale:
Everyone is affected emotionally by negativity and negative circumstances and it can be extremely draining, demotivating, and have untold effects on staff and clients, particularly in the event of injuries. Conversely, a positive environment is created by clear processes, procedures, communications and expectations. This leads to happier, more productive people.
Monetary savings:
Proper compliance can also save companies money. Keeping records of equipment maintenance, for instance, preserves warranties. Well maintained equipment will also last longer and can be factored into asset management plans to allow for resale and replacement over time.
Utilities monitoring can pick up problems such as water leaks, or faulty systems so that repairs can be quickly identified and carried out.
Gyms with fewer issues may also qualify for cheaper insurance, especially if more gyms focus on compliance in the long term, as industry trends will show a decrease in claims. This in turn makes gyms less of a risk to insure and therefore should drive policy prices down.
Compliance also creates a more positive and orderly environment, so members are more likely to enjoy the experience and keep returning.
Time savings:
Having standardised, emotion-free processes and procedures saves time. Time spent working out how to deal with issues that arise, how to respond to complaints, how to manage incidents, accidents, near misses, staff training, maintenance records, etc. are all reduced by implementing a thoroughly assessed management system. Even more time is saved if the majority of this is done for you – which is what we do!
Better understanding and mitigation of risks:
Being proactive (as opposed to reactive) regarding business risks allows more mitigation to be put in place, reducing risks further. Even if negative events occur, businesses that are prepared can better deal with these events as plans are in place for emergency situations, making them less of a problem than if nothing was in place.
Reputation:
When businesses have a problem, word gets around. Especially in an information-rich, social media world. Disgruntled clients often threaten to tell their story far and wide, so businesses should strive to be meticulous in handling issues that come up.
Complaints, issues, problems also keep coming. It’s the nature of customer-facing businesses, and owner burnout is real. Having compliance systems not only reduces the likelihood of negative instances, but creates a standard operating procedure to remove emotions. This in turn reduces the personal toll it can take on owners.
Reputation is also important on a larger scale – as functional fitness gyms become more successful and mainstream at improving the health and fitness of their clients, more eyes will be on them, scrutinising their operations. Having these squared away will limit negativity and problems down the line. If we truly want to be ‘part of something bigger’, we need to be mindful of how our own actions affect others – negative circumstances get publicity, especially on ‘gym fails’ type social media, giving the overall impression that ‘CrossFit is dangerous’. Gyms who don’t make compliance a priority are not only risking their own business, but affecting others.
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It can be challenging to stay compliant. Legislation can change year on year, and monitoring can be time consuming. Just identifying the requirements in the first place is a significant undertaking in itself.
The Ellipsis Affiliate System has done the hard work for you. A robust Legal Register oversees more than 140 supporting templates to ensure compliance. Templates range from risk assessments to staff training, from gap analysis to data protection and everything in between.
Ellipsis also provides an auditing solution to ensure ongoing compliance, resulting in the Ellipsis Quality Mark®️ – the gold standard for gym quality assurance. Achievement of the Mark indicates commitment to compliance across the board to the safety and wellbeing of staff, clients and the wider environment.