The recent Gartner Symposium/ITxpo tackled how digital business is redefining the role of the information technology (IT) function. There also was a deeper message at the core of most of the presentations that applies much more broadly: Digital business is disrupting all corporate functions. This includes tax functions. And the way tax and other functions redefine themselves in response to this digital disruption will go a long way toward determining the extent to which they lead or lag behind in the coming years.
Gartner offered up an impressive list of speakers including, Microsoft CEO Satya Nadella, Apple Co-Founder Steve Wozniak, Lyft Co-Founder and President John Zimmer, and Peter Thiel, the technology entrepreneur, investor and author.
Thiel, who has been making the rounds recently to promote his new book, “Zero to One: Notes on Startups, or How to Build the Future” includes many interesting insights, including this one: “Customers won’t care about any particular technology unless it solves a particular problem in a superior way.”
Many discussions at the conference turned out to be highly applicable to tax functions and their leaders. Here are three prominent points from the conference that I think are particularly tax-relevant:
- Scale no Longer Needs Size: Breakthroughs in digital technologies are upending traditional industry segments. Digital technology – along with a growing reliance on contingent workers – helps more companies greatly expand their reach without greatly expanding the size of their full-time workforces. Leading tax functions are leveraging technology to help them do more with less.
- Bimodal is an Attractive Option: Gartner research points to a need for IT functions to become “bimodal” – an approach that roughly translates to dedicating part of the function to meeting traditional “lights-on” technology requirements and another part of function to operating much more like a “technology startup” while collaborating with business units that also operate in a fast, fluid and digital manner. From a tax perspective, there is a similar opportunity for tax functions to operate in a bimodal fashion – by conducting all necessary transactional work, while increasing the function’s participation in strategic activities (e.g., M&A due diligence, strategic planning and more).
- Technology supports humans: Amid all of the talk about technology innovations and the impact on corporations, it was interesting to hear an emphasis also being placed on the human aspects of the digital world. Yes, smart phones, always-on connectivity, data analytics, social media and other advancements have empowered companies, but these digital breakthroughs also pose challenges to people if they are not applied and managed correctly. (Think about how much meeting time is wasted because half the folks in the conference room are distracted from the discussion while pecking away on their smart phones).
As a tax technologist, I wholeheartedly believe our tax technology solves many tax problems. I also believe that leading tax technology can help to redefine tax functions and the importance of their contributions to corporations across the globe.
Please remember that the Tax Matters provides information for educational purposes, not specific tax or legal advice. Always consult a qualified tax or legal advisor before taking any action based on this information.