Tax transformed series
As the tax function prepares to transform for the future, it’s time for organizations to rethink their people strategy. You’ll need to assess the hard and soft skills your teams need to thrive. Self-awareness, flexibility, agility and the upskilling of your people will be keys to success for both the tax function and the organization as a whole. Knowing how your tax team contributes towards your organizational purpose will, in turn, help drive deeper levels of individual engagement.
An organization’s strategy for its tax function should start with a people strategy to map out how the tax function’s roles and processes are changing, and which skills people will need to do their jobs effectively. Skills requirements have changed, as manual tasks are automated and businesses seek to extract value from big data using analytics and artificial intelligence. A higher level of self-awareness can allow for an increase in emotional intelligence to complement how an organization effectively embraces artificial intelligence (AI). While many people fear being replaced by technology, it’s often more about thinking and working differently.
PwC’s 22nd annual CEO Survey found that 87.9% of Canadian CEOs (vs. 79.2% globally) are either somewhat or extremely concerned about the availability of key skills as a potential threat to their organization’s growth prospects—and that includes the tax function. Traditional tax skills will need to be supplemented with technology and data skills, so that tax functions can meet their reporting and compliance obligations and deliver value to the business through insights drawn from tax data.
A number of factors are fueling the fight for talent. Skills requirements are changing too fast for university and college programs to keep up. Canada’s population is ageing, with a large segment retiring. More and more companies are looking to Canada to expand their operations, as our government works hard to attract foreign business. And there’s demand from our own, home-grown start-ups.
Here are four ways to make sure your tax function has key skills for the future:
Upskilling is no longer about employees taking time out for a one-off training course. Rather, employees will need to acquire new skills and knowledge as part of their job, in a continuous cycle of learning and applying. For this shift in mindset to occur, companies need to encourage and value continuous learning that benefits employees both personally and professionally. Leaders need to foster a culture of innovation and trust where employees feel safe to unlearn, relearn, try new things and even fail.
Businesses should not automatically assume that older members of their workforce will be less willing or able than younger members to embrace technology or adapt to change. Moreover, the experience and deep subject-matter expertise of mid-career staff with regard to their role, the business and the industry are key inputs when trying to determine what can be done differently.
A crucial aspect of upskilling is to personalize learning. Tools such as PwC’s Digital Fitness App allow employees to learn at their own pace and start at a level that’s relevant for them. Learning new skills should also be fun (e.g. gamification) and rewarding, with a variety of incentives (days off, gift certificates for restaurants, etc.).
Compared to 10-15 years ago, the role of the tax function is not only more technology-oriented but also requires people to have very specialized tax expertise. Partnering with a firm that has a dedicated “in-house team” through a managed tax services arrangement allows organizations to access these niche tax skills, as well as best-in-class technology. This results in improved quality, reduced risk, and potential cost savings by avoiding upfront investments in technology and Learning and Development.
Managed tax services arrangements can also address issues of scalability. The tax function represents a huge fixed cost when done in-house. If the demands on the tax function are susceptible to change, or the Canadian tax footprint is too small to justify dedicated tax resources, the organization may struggle to adapt. With a managed tax services arrangement, services are paid for as needed.
In today’s global race for talent, immigration is essential to a company’s talent strategy. With demand for key skills outweighing supply, Canadian companies have to look beyond local borders to meet their talent needs and business objectives.
The Canadian government has introduced a number of initiatives to make it easier and faster for companies to bring talent into the country. These include a myriad of tax credits, grants and programs for hiring foreign workers. Understanding the nuances of all the different work permit streams and immigration requirements is essential to getting qualified candidates into Canada quickly.
Focusing on specific programs or categories can also help narrow your search. For example, the Mobilité Francophone category is one of the fastest work permit categories for bringing highly skilled French-speaking talent into Canadian destinations outside of Quebec, even if French is not required for the job position. Another example is the International Experience Canada (IEC) program, which consists of a series of bilateral agreements with country-specific eligibility criteria that provide work permit options to citizens of member countries.
Ideally, your talent strategy should look ahead three to five years. Consult with us early in the process. We can also provide guidance on mobilizing your international talent between firm territories.
Once you’ve found the right people, how do you encourage them to stay? Employee retention is about creating the right culture: a place of caring, innovation, trust and support. It means providing opportunities for continuous development and growth, and investing in your people.
Pay attention to the quality of your underlying relationships. Use technology to redefine how your people can spend less time on repetitive tasks and add more value. Provide opportunities for tax professionals to connect with the business and business strategy, so they can be at the forefront of the company’s digital strategy and uncover tax opportunities. Encourage your tax function to provide input on tax policy matters that impact the company, so they’ll be better positioned to manage the tax risks.
For people brought in through immigration, ensure that you have a support structure in place to help them adjust to life in Canada. You may even wish to back their application for permanent residence. This can be a cost-saving approach as it avoids the recurring expenses of temporary work permits. While some companies opt to build clawbacks into employment contracts to protect their investment, long-term incentives and a culture of ongoing support can be effective methods for retaining this precious new talent.
Support and value your employees’ efforts to try new things. As day-to-day roles become more intertwined with technology, on-the-job training is important—without throwing away hard-earned expertise.
Learn about the many different work permit and visa categories. Use this knowledge strategically to bring in skilled talent to address your organization’s skills gap.
For some organizations, the significant investments in technology, upskilling or new hires might support a move towards managed tax services.
Does your organization have what it takes to keep employees satisfied, engaged and inspired to want to continue working for you? If not, what’s missing?