Addressing The People Puzzle
By Gary Paice and Meg Lyons

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Future Change

Two-thirds of responding tax executives "mostly agreed" they felt confident about their personal ability to manage changes required by their department's future direction. When this future was defined as a movement to a digital world, approximately half of the responding companies "somewhat agreed" their current tax professionals possess the necessary skills.

In reality, the median tax technology budget is currently between 5 and 10 percent of the total department budget. These percentages seem exceptionally low, considering the suggested future movement to a much more digital function. However, since a tax department's data-gathering abilities are usually reliant on the finance function, these percentages may be skewed by virtue of finance or IT absorbing most of the costs.

Predictions

Could we be poised for a major change in the way corporate tax departments address people-related issues? Most tax leaders and Andersen agree that the future promises a world of seamless access to data in which tax professionals work with business strategists to deliver value. However, unless a dramatic shift occurs on college campuses, Andersen foresees a moderate to severe shortage of tax professionals over the next five years.

Therefore, it will become even more difficult for corporate tax departments to rely on traditional means to hire and retain personnel. The tax community, by necessity, will become more collaborative, with an increased focus on partnering and teaming.

In addition, most corporate tax functions today spend the majority of their scarce resource time in the reporting area - producing and defending tax returns. In the future, these activities will be largely redirected towards timely and quality access to critical information necessary for planning and analysis, utilizing technology and process improvement. Tax departments will either team with outside providers to implement technology and process change, or they will make significant commitments to retrain tax reporting personnel to fill the technology and process roles of the future.

Gary Paice is a partner with Andersen. Based in Chicago, he is a member of the Tax Transformation practice and provides technology analysis and advice to process improvement teams of large, multi-national corporate tax departments. Meg Lyons is a senior manager with Andersen, based in Chicago, experienced in tax process improvement and tax technology integration with many Fortune 500 companies. Andersen's Global Best Practices group maintains the "Solving the People Puzzle" survey. To receive a complimentary benchmark report of your company's results against the survey population, contact Gary Paice at 312.507. 2387 or gary.p.paice@us.andersen.com. All responding companies remain confidential.