The Five TX Laws are a form of universal truth. We know this because, after taking the tech-centric route for some time, astute individuals tend to always arrive at the same or similar set of conclusions.
This is the fourth of five articles where we examine each law in turn―first with a guiding principle, and secondly with a conversational narrative that provides real-world context in everyday language. For this, we imagined ourselves chatting with an intelligent friend, sipping brandy in comfortable armchairs by a fire (mental imagery inspired by The Economist Style Guide).
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TX Law #4: Transformation is a Journey, Not a Project
Principle: Transformation resists familiar frames of reference until experienced firsthand over time.
Fireside chat:
Intelligent friend: “We’ve just kicked off our tax transformation project. We’re installing a tax engine.”
Taxologist: “Hang on. Are you transforming the tax function or installing a tax engine? They’re different things; one doesn’t necessarily lead to the other. Can you tell me more?”
Intelligent friend: “Sure. We’ve hired a top-notch consultancy specializing in tax engines and worked with them to make sure they’re happy with the project. In the past, we’ve been accused of making the conditions so tight that we set them up for failure, so this time our chances of success are good.”
Taxologist: “Yes … for the tax engine, but that has nothing to do with transforming the people in your tax function. In fact, by outsourcing the implementation, you may have already killed off that opportunity for now.”
Intelligent friend: “What do you mean?”
Taxologist: “Well, by outsourcing the project, you’ve missed the best opportunity you will ever have to not just upskill your team, but transform them. Even then, you have to prepare in advance. First, you must put in place ‘Tax Solution Program Management’ or something similar, which will span all projects and technologies. For this, you need the right skills, the right org structure, and the right leadership. Then you must adjust your thinking and ways of working to make sure you don’t ‘set them up for failure’, as you put it. Lastly, you must get to grips with data, which requires a journey of transformation, because trustworthy data can only exist in a transformed state. That journey is all about people, and people take time to adapt. Oh, and by the way, you’ll need help. Without help, your journey will be guesswork, too costly, and endless.”
Intelligent friend: “You mean our transformation journey will never end!?”
Taxologist: “Not at all. According to Lindsay Herbert [Digital Transformation, Bloomsbury Publishing, 2017], digital transformation is a one-time event, but it’s still a journey. You have to remember—a transformed state is a way of being at the end of a journey that defies the usual reference points until the people experience it for themselves. Projects, on the other hand, need stated deliverables in advance; but until you’ve been on that journey, no one can envisage what those are. Even a great transformation consultant only helps set the trajectory. The people have to see it for themselves. This is why Dr. Corrie Block reports in a Forbes article that transformation projects have an 84% failure rate.”
Intelligent friend: “Ok, I certainly don’t want that. Can you help?”
Taxologist: “Sure. Let’s set up a call.”
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Feel free to check out the previous articles in this series: TX Law #1, TX Law #2, and TX Law #3.
Please remember to join us at WU Tax Law Technology Center course in Vienna – Nov 2024, where we will explore (business) use cases, discuss specific strategies, and workshop practical aspects of tax transformation.
Until next time …
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