In the groundbreaking book, The Wisdom of Crowds, author James Surowiecki concludes that groups of individuals are at their smartest “when there is a balance between the information that everyone in the group shares and the information that each of the members of the group holds privately.”
A groundbreaking new independent survey “Solving VAT: Challenges for Tax, Finance and IT teams” – of 400-plus finance, tax and IT decision-makers in DACH, UK and Ireland, France, the Nordics and Benelux – share plenty of information that help global business leaders make the smartest decision possible concerning their indirect tax automation investments.
The survey responses combined with in-depth interviews, serve as the basis of a webcast and a white paper. Both pieces of thought leadership shed new light on indirect tax automation solutions — discussion topics cover:
- Business benefits and surprising number of shortcomings of existing tax automation solutions;
- The state of IT environments and feelings towards cloud migration;
- The use of ERP tax engine automation and the adoption of SAP S/4HANA;
- The confusion and miscommunication of tax automation budget ownership;
- The true and day-to-day pressing VAT challenges, and more.
By collecting and synthesizing observations from tax, finance and IT decision-makers, the research demonstrates the crucial Wisdom of Crowds principle that a diversity of perspectives and opinions makes large groups wiser.
Who really owns and who do you think owns indirect tax automation?
Varied perspectives often interact in surprising ways, and that’s certainly the case with budget ownership of indirect tax automation solutions. Finance (cited by 48% of all respondents) most frequently owns the budget, followed by IT (36%) and the tax department (16%).
However, in anecdotal discussions, each functional segment was considerably more likely to think that their own department had ownership of the tax automation solution budget. That confusion is crucial to clear up if the returns on new tax technology investments are to be maximized.
On most other points, the survey respondents were on the same page. That’s particularly the case concerning the cloud migration and VAT complexity:
- 75% report that their applications/software are “cloud-first” or that a majority have been migrated to the cloud; and
- 84% report that VAT is becoming more complex for their organization.
The good news is that those two trends are driving more companies to optimize (and integrate) their SAP environment and indirect tax automation solutions.
In upcoming posts, we’ll drill down and take a closer look at what all of these trends, challenges and opportunities mean for the tax, finance and IT crowds.
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. The views and opinions expressed in Tax Matters are those of the authors and do not necessarily reflect the official policy, position, or opinion of Vertex Inc.