Implementing an Innovation Process in Internal Audit
The "How" and the "Why" to start an innovation process for your Internal Audit Team
Implementing an Innovation Process in Internal Audit
“Innovation can strike anywhere, and it’s the catalyst for change.” This quote comes from a video on Protiviti’s website honoring the winners of their inaugural Audit Innovator Awards.
Innovation CAN strike where you least expect it.
But it can also strike because you deliberately created the conditions to make it happen.
Internal Audit teams are often stretched thin—low on resources and high on demands. Yet the pressure to take on more continues to build, driven by both CAEs and Management.
We’re not being asked to do more with less—we’re being put in the position to. That makes innovation a necessity, not a luxury. But who has time to sit around waiting for inspiration to strike?
If your Internal Audit function doesn’t have an innovation process already, it’s time to start one.
Innovation won’t happen unless you make it a priority
At EY, I worked in a Fortune 100 Internal Audit department that had a formal innovation process.
Here’s how it worked at that Fortune 100 internal audit team.
- Ideation. Our entire Internal Audit team met regularly to brainstorm ways we could innovate
We asked ourselves: How can we provide deeper assurance through our audits? How can we stay in sync with changes inside and outside the business? Are there tools, techniques, or technologies we can use to be more efficient and resourceful?
To keep things approachable, we removed the pressure to invent something revolutionary. Instead, we focused on practical improvements—drawing inspiration from emerging audit practices, new technologies, and innovations we’d seen in other departments or industries.
Everyone was encouraged to share ideas, give feedback, and build on each other's thoughts. The goal wasn’t to reinvent the wheel—it was to find smart ways to make our wheel turn smoother.
- Selection. Every other week, our innovation committee met to evaluate which ideas should move forward and receive support from the team’s resources.
We considered several factors during selection: how well the idea was developed, the specific problem it aimed to solve, the level of investment required, and the overall enthusiasm for the idea within the team.
- Build-out. Ideation continued for selected innovations, with a subset of the team meeting weekly for another month to develop a clear vision and plan for one or more pilot projects, their target outcomes, and how success would be measured.
- Pilot. A small team piloted the innovation for the agreed-upon timeline (which allowed for trial and error).
- Governance. With the scope solidified, leadership also created a simple governance structure to oversee implementation, monitor progress of the pilot, and determine if/when to roll out the innovation as a new process for the full team to adopt.
- Alignment. The CAE and other leaders stayed aligned throughout the pilot, providing oversight, encouragement, and support in overcoming roadblocks and managing competing priorities (e.g., redistributing the pilot team’s workloads if needed).
- Decision. Based on the pilot results and initial governance structure, leadership decided whether the innovation’s outcomes delivered the anticipated value. If green-lit, leadership expanded governance to guide roll-out and scaling across the team.
- Implementation. The full team implemented the innovation, with governance continuing to monitor results and value realization.
It’s worth noting that while this process was designed for a team of 75+, it can be scaled down and adapted for teams as small as three. Naturally, the level of formality will vary depending on team size and available bandwidth—but the core principles can still drive meaningful innovation regardless of scale.
Finding Innovation Inspiration
Technology is a key force for enabling innovation and should be considered. But technology doesn’t have to be central. Anything can be a catalyst for innovation.
For example, maybe your innovation focuses on a new way to recruit, a different format for communicating audit results, or a new method for allocating resources. Maybe you want to build a process to identify the skill sets that will help take your Internal Audit team to the next level, or a way to productize different audit phases so they can be executed by anyone on your team.
To jumpstart your ideation process:
- What are your team’s problems worth solving or opportunities worth seizing?
- What are other Internal Audit teams doing differently?
- Can you leverage internal best practices from IT, other risk and assurance functions, or industry?
- Can you introduce an enterprise-wide analytics tool into your workflows?
- What do your key stakeholders think would help you audit faster and better?
- Are other departments doing similar work you could collaborate on?
Benefits Beyond Innovation
Even small steps toward innovation can help alleviate capacity challenges and enhance your function’s effectiveness. But innovation can also do more.
In that Fortune 100 Internal Audit team, auditors rallied around our innovation process, reducing attrition due to feeling part of something special.
Because we were seen as an innovative team externally, any open roles were quickly filled.
Because we were seen as an innovative team internally, we were more likely to get new budget requests approved.
Your team’s reputation could soar internally, leading to more management requests to get involved in key initiatives.
You could become seen as an employer of choice, attracting higher-caliber candidates internally and externally.
At minimum, you’ll have a more engaged and motivated team likely to take ownership of bringing innovative ideas into their own processes.
But who knows? You could even find yourself on stage celebrated by hundreds of your peers, sharing the success that all began with you instituting an innovation process within your team.
Enable Innovation in Your Team
The award-winning DPCC and Chewy Internal Audit teams undoubtedly faced challenges. They probably juggled already packed workloads, hit roadblocks, and had moments of doubt.
But they pushed forward. And their efforts clearly paid off.
You can identify, build, and scale your own game-changing initiative.
For CAEs without a formal innovation process, now is the time to establish one. And for audit professionals who are not CAEs but work in teams without an innovation framework — take the initiative to start one. Beyond driving positive change, it can set you apart as a strong candidate for future leadership opportunities.
Just get started. Seek out opportunities to innovate, rethink processes, and push boundaries. The only thing that won’t get your innovation anywhere? Not starting it at all.
When you are ready, here are three more ways I can help you.
1. The Enabling Positive Change Weekly Newsletter: I share practical guidance to uplevel the practice of Internal Audit and SOX Compliance.
2. The SOX Accelerator Program: A 16-week, expert-led CPE learning program on how to build or manage a modern & contemporary SOX program.
3. The Internal Audit Collective Community: An online, managed, community to gain perspectives, share templates, expand your network, and to keep a pulse on what’s happening in Internal Audit and SOX compliance.