Preparing for the future of tax
Organizations and tax departments foster the changing role of the tax professional
To capitalize on the Power of With—bringing together tax professionals and automation to amplify their collective capabilities—companies, tax departments, and tax professionals must learn to leverage new technologies and cultivate the capabilities they need for the digital future. Our series explores the roles that the individual, the organization, and the team will play in preparing for the digital future of tax.
Teaming with machines
Adaptable Organizations1 operate with talent models that drive agility through networks of teams and automation technologies that augment and amplify the capabilities of those teams.
The operative word there is “teams.” Leaders, individuals, and the organization are important, but teams that include automations, such as robotic process automation (RPA), artificial intelligence (AI), and other technologies, are the glue that binds all of that together. Teams that are preparing for the future of tax can harness the Power of With to create an environment where humans and machines work closely together to mutually boost each other’s efforts.
1Source: “The Adaptable Organization: Harnessing a networked enterprise of human resilience,” Tara Murphy and Amir Rahnema, Deloitte, 2018,
Effective teaming in a digital tax department
What are some of the lessons learned from teams that were early adopters of tax automation solutions? How can tax professionals and automation collaborate to achieve favorable outcomes? What practical steps can tax departments take to encourage teaming between people and technology?
Here are four considerations for effective teaming in a digital tax department:
- Assemble multi-skilled teams: Tax professionals of the future will be asked to team not only with the automations, but also with information technology (IT) professionals, data scientists, and other professionals from across functions to collectively move the business forward. Tax leaders will need to revisit their talent models, consider new roles, responsibilities, and job descriptions, and think in new ways about how work is assigned and managed.
- Be purpose-driven and move fast: Meaningful work binds team members together. It emboldens and energizes them to execute their shared mission. Adding automations into the equation can multiply those benefits by helping human team members address tedious, manual tasks faster, more efficiently, and, often, more accurately.
- Challenge the norm: Breakthroughs are often achieved when teams challenge yesterday’s—and even today’s—accepted practices to create the new approaches of tomorrow. This type of thinking requires a different kind of leadership and collaboration between tax team members—one that values all insights and opinions regardless of who offers them and how “out there” they may seem to be at first.
- Manage the hybrid workforce: With tedious, manual tasks being done by automations, tax professionals can use their freed-up time to focus on work that adds even more value. The key is to plan in advance for how they can use this repurposed time.
Stronger together
Conventional wisdom believes that high-performing individuals deliver organizational performance. Adaptable organizations, on the other hand, place greater emphasis on teams and help unlock individual performance through team composition and new ways of working.
Digital transformation and the Power of With—a real team effort
By harnessing the Power of With, digitally transformed tax departments have an opportunity to significantly improve the way they provide services. When considering life in a tax department that leverages automations, it is important to include tax department personnel in brainstorming automation possibilities, establish realistic expectations for what tax professionals and other human team members can expect of their automation counterparts, and provide the education and training that adequately prepares them to work alongside those automations. The Power of With is here. Is your team prepared for the future of tax?
Moving the tax department toward the digital future
Technological advances are rapidly transforming businesses, and the tax function is no exception. Ninety-two percent of C-level executives recently surveyed by NewVantage Partners indicated that their companies are accelerating investments in big data and artificial intelligence (AI).2 This sentiment echoes a recent Deloitte Australia survey of tax executives in which 85 percent of respondents said they believe unprecedented change driven by digital transformation is coming to tax in the next five years.3
Yet few companies seem to be prepared for the future of tax. In the Deloitte Australia survey, tax executives reported widespread unpreparedness for digital transformation due to a lack of tech-savviness and no documented digital strategy for tax.
This lack of preparedness should be concerning. Embracing the Power of With—facilitating an environment in which humans work extensively with machines to amplify their collective capabilities—is imperative for companies and their tax departments.
So what can tax departments themselves do to move forward?
2Source: NewVantage Partners, Big Data and AI Executive Survey 2019, January 2019, http://newvantage.com/wp-content/uploads/2018/12/Big-Data-Executive-Survey-2019-Findings-Updated-010219-1.pdf.
3Source: Deloitte Touche Tohmatsu, Australia's Future Tax Professional: The Survey, August 2018, www2.deloitte.com/au/en/pages/tax/articles/future-tax-professional.html.
Three actions to prepare your department for the future of tax
1. Identify and act on emerging talent requirements: Tax-technical knowledge will continue to be important. However, as the focus on data-wrangling and report-building diminishes in the due to digitization of processes, flexibility and strong collaboration skills will be needed in the future of tax, as well.
2. Focus intensely on change management: Tax leaders can benefit from change management that helps bring their people along on the journey. Asking critical questions, seeking buy-in and leadership endorsement, and prudent risk-taking are among the techniques.
3. Inspire people to adopt continuous learning and adaptability: Adaptable is not something a person or organization does, it is what they become. Tax professionals should be provided with opportunities to reinvent themselves and coached to embrace an expansive mindset that encompasses global, growth, design-thinking, and diversity-of-thinking perspectives.
The organizational change imperative
Digital transformation in the future of tax is all about the introduction of new operating models and technologies that supplement and improve current processes. Technology and the global regulatory environment will continue to change rapidly. Now is the time for strong tax leadership and an organizational push to make the tax department of the future a reality today.
Working (and thriving) in a digital tax world
Predictions of a robotic takeover of the future of tax are giving way to a more practical reality: That automation technologies like robotic process automation (RPA) and artificial intelligence (AI) will likely augment and enhance the work of tax professionals, not replace it.
Some tax department activities—mainly those that are rules-based, involve repetitive data management, or impact the tax compliance process—may be automated. But professional judgment, intuition, communication, and advisory skills will not.
It’s important for tax professionals of the future to start preparing for this digital transformation today by understanding the disruptive technologies involved, determining their role in the digital tax department, and taking ownership of the reskilling required.
Understanding disruptive technology in the future of tax
In a recent Deloitte Australia survey of Australian tax executives,4 85 percent of respondents said they believe unprecedented change is coming to tax in the next five years. Yet when asked about their own knowledge of specific disruptive technologies, only 30 percent say they understand RPA, 28 percent understand big data, 17 percent understand AI, and 8 percent understand blockchain.
Less than half (48 percent) of respondents described themselves as tech-savvy, and only 40 percent said they know what training they need to be ready for the future of tax.
This represents a major learning opportunity about the types of technologies likely to power the tax function of the future and how to extract value from these solutions to become more effective in their jobs.
4Source: Deloitte Touche Tohmatsu, Australia's Future Tax Professional: The Survey, August 2018.
Embracing the Power of With
Humans with machines. Data with purpose. Automation with intelligence. Scale with speed. Digital transformation in the tax department will be all about applying technology to supplement and improve current processes.
Analyzing the changing role of the tax professional
Digitally disruptive technologies and technology tax transformation may create other opportunities for tax professionals in the future of tax too. For example, as more compliance tasks are automated with RPA and AI, in-house tax professionals may be freed up to take on other value-adding roles within the organization.
A different set of skills will likely be required in the digital tax department—from project, data, and people management skills to an understanding of how to apply technology to daily tasks.
The tax professional and automation: six steps to prepare
So, what can tax professionals do right now to take ownership of their future and reskill for it?
- Become more tech savvy.
- Expand analytical skills to leverage data better.
- Tear down the silos to foster communications.
- Build problem-solving skills and improve business communications skills.
- Adopt an advisory mindset.
- Learn constantly.
Lead with authority and by example
By developing a firm understanding of what their own digital tax department could look like and defining their role in it, tax professionals of the future can take definitive, effective actions in the coming months. The key is to get started now.
